Daniel Otera
The Federal Government has issued a nationwide compliance directive mandating all Ministries, Departments, and Agencies (MDAs) to register their equipment leasing transactions with the Equipment Leasing Registration Authority (ELRA). The directive, confirmed via a 27 June 2025 circular from the Ministry of Finance (Ref: F/LEG/2809/15/T2/7), aims to enforce transparency and accountability in lease agreements across the public sector.
According to the circular, all MDAs are now required to upload lease agreements, payment schedules, and asset valuation records to ELRA’s online platform, which has been designated as the central repository for leasing data. The measure forms part of the government’s efforts to plug leakages in public expenditure, following years of documented abuse of lease-based procurement.
Though the Equipment Leasing Act establishing ELRA was signed into law in 2015, the agency remained largely dormant until the May 2025 circular formally activated its enforcement role. With this new mandate, ELRA is now authorised to monitor compliance, demand reporting, and coordinate inter-agency verification of lease documentation.
“Any MDA failing to comply with this directive will be flagged for procurement breach,” the circular stated, noting that “lease transactions above ₦10 million must carry ELRA certification to qualify for Treasury funding.”
The development follows multiple audit findings showing alarming gaps in Nigeria’s leasing and procurement ecosystem. According to the 2020 audit by the Office of the Auditor-General for the Federation, 256 MDAs spent ₦284.3 billion without appropriation or legal approval. The 2021 audit uncovered additional irregular contract payments amounting to ₦197.7 billion, of which ₦167 billion was linked to unexecuted or poorly executed projects. The Nigerian Bulk Electricity Trading Plc alone accounted for over ₦100 billion in questionable disbursements.
Additional red flags flagged in the reports included non-competitive bidding, missing payment vouchers, and undocumented service delivery many of which were tied to outsourced service contracts and lease arrangements.
Against this backdrop, Nigeria’s leasing industry has grown significantly in both public and private sectors. Data from the Equipment Leasing Association of Nigeria (ELAN) shows that leasing contributed ₦2.6 trillion to Nigeria’s GDP in 2022, with government agencies and corporates driving much of the growth. Lease financing for assets such as vehicles, power equipment, construction machinery, and ICT infrastructure has become increasingly common, especially among MDAs constrained by capital ceilings.
Public procurement observers have long raised concerns about the lack of oversight in equipment leasing practices within government institutions. A 2023 policy brief by the Public and Private Development Centre (PPDC), a transparency-focused NGO, noted that lease-based procurement is often used to bypass capital expenditure ceilings or defer disclosure of long-term liabilities.
A joint study by the United Nations Office on Drugs and Crime (UNODC) and the Bureau of Public Procurement (BPP) also warned in 2021 that weak controls in public leasing and outsourcing contracts were contributing to fiscal opacity and corruption.
The new ELRA compliance order appears designed to close these gaps. By mandating registration, the government is positioning ELRA as a gatekeeper for transparency in public leasing. The move also aligns with ongoing digital reforms at the Ministry of Finance, including expenditure traceability and automation of procurement workflows.
“The ELRA directive is a welcome step towards institutionalising accountability in Nigeria’s lease ecosystem,” said a compliance officer at one MDA, speaking under anonymity because they were not authorised to comment officially. “It puts pressure on us to keep accurate records and follow due process.”
ELRA’s portal, which has now gone live, includes modules for lease registration, due diligence tracking, contract certification, and default monitoring. Officials say agencies that fail to upload leasing transactions risk being excluded from future funding cycles.
In response to the directive, ELRA has begun dispatching training circulars and hosting virtual sessions with procurement and accounts officers across federal MDAs. According to the agency’s bulletin published on its official website on 1 July 2025, more than 200 institutions have already initiated compliance processes.
The FG’s push for equipment lease reform may reshape how MDAs engage with vendors, particularly in sectors like health, education, and public works, where leased assets have become integral to service delivery. If fully enforced, the new compliance rule could reduce waste, standardise contract duration, and create a more auditable leasing ecosystem across government.