Many Nigerians have expressed shock after the Internal Revenue Service (IRS) of the Federal Capital Territory (FCT) say it has approved ₦242.8 million for Microsoft 365 licenses as part of the digitisation efforts at the agency. The Chairman, FCT IRS Michael Ango made the statement on a presentation captured on Africa Independent Television (AIT) shown on X, formerly Twitter, many Nigerians have queried how Microsoft licences for the agency could be that expensive.
Morris Monye @Morris_Monye said, “may be I’m not tech savvy but how much is Microsoft 365 licence. Or am I not hearing it well?
Dr. Fames tweeting @Eronsjohnson said, “We have 1200 users in my firm and I purchased this for GBP 7,000 plus other jara packages. How did they arrive at that figure?
Esscanorrr tweeting @ozill_ said, “Microsoft E3 license is $33.75, E5 is $35.75. Now if you purchase that for 1000 staffs and covert it to naira, that is about 55 million naira. Mind you, not all staffs would use the E3 and E5 licenses, some would be given lesser ones the business standard license which is $12.50. In conclusion, corruption is deeply rooted in this country and it ain’t changing soon.”
Victor Bassey tweeting @Vicbersong tweeted, “It will depend on the license tier and number of users. The highest tier is Microsoft 365 E5 and can be quite costly. However, I still don’t trust that figure. No be naija again.”
It is still clear that the total cost of license to the agency is dependent on the number of licenses and the category of licenses. With a staff strength of 623, questions arise about how many employees will receive licenses and whether the allocated amount aligns with actual Microsoft pricing. Microsoft offers different plans, each with varying costs. However, the specific plan chosen by the FCT IRS has not been disclosed.
Following clips of the presentation on Africa Independent Television (AIT) shown on X, formerly Twitter, many Nigerians have queried how Microsoft licences for the agency could be that expensive.
Table 1. Microsoft License Prices
| Plan | Price (USD per user/ month | Price (N per user / Month) | Price (N per user / Year) | Key Features |
| 365 Business Basic | 6.0 | 9,600 | 115,200 | Web & Mobile apps, 1Tb Onedrive, Teams, Emails |
| 365 Apps for Business | 8.25 | 13,200 | 158,400 | Desktop & Mobile apps, 1TB Onedrive, No Email |
| 365 Business Standard | 12.5 | 20,000 | 240,000 | Desktops Apps, 1TB Onedrive, Teams, Emails, Webinars |
| 365 Business Premium | 22.0 | 35,200 | 422,000 | All features standard +Advanced Security, Device Management |
| 365 E3 | 36.0 | 57,600 | 691,200 | Enterprise Security, compliance, unlimited storage |
| 365E5 | 57.0 | 91,200 | 1,09,440 | Advanced security, analytics, compliance, voice calling |
Microsoft 365 Business Premium, the highest speculatively for a business, which includes security, device management, and collaboration tools, currently costs ₦35,200 per user per month, amounting to ₦422,400 per user per year. If all 623 staff were to receive this plan, the total cost would be around ₦263 million per year, which is higher than the ₦242.8 million approved. However, it is unlikely that every staff member will be assigned a license, as some roles may not require Microsoft 365 access.
In many organizations, only certain employees require full Microsoft 365 access, particularly those in administrative, managerial, and IT roles. Field officers and lower-level employees may either not need access or may be assigned more basic plans with fewer features, which could lower the total cost.
Another possibility is that the government secured a bulk discount, which is common in enterprise and government contracts with Microsoft. Additionally, the ₦242.8 million may cover more than just licenses—it could include IT support, cybersecurity, data migration, or even training for staff.
While digital transformation is necessary, the government has a history of procurement deals coming under scrutiny for overpricing or inefficiencies. To ensure transparency, it is important for the FCT IRS to clarify the number of licenses purchased, the specific Microsoft 365 plans used, and whether additional services are included in the contract. This would provide a clearer picture of how the ₦242.8 million will be utilized.
A closer look at past government deals suggests that this may not be an isolated case. Public funds have repeatedly been mismanaged through questionable procurement practices, with projects often costing far more than their actual market value.
One such example is the Nigerian National Petroleum Corporation (NNPC), which, in 2009, approved a contract worth US $25.57 million to implement an electronic management system. However, instead of modernizing operations, the project became a financial drain. Years later, investigations revealed that successive NNPC management teams had manipulated loopholes in the project’s execution, leading to billions in losses. The system, which was meant to enhance efficiency, was never fully implemented, yet the allocated funds had already been spent.
A similar case of procurement irregularity occurred at the Abuja Geographic Information System (AGIS). In 2015, AGIS awarded contracts totaling about ₦25 million for office equipment repairs and maintenance. However, it was later discovered that these contracts had been funneled through proxy companies, with discrepancies in company addresses and execution. The contracts appeared to be a front for siphoning public funds rather than genuine infrastructure improvements.
In Osun State, between 2019 and 2021, projects worth ₦1.3 billion were awarded to companies that did not even exist. This raised serious questions about the transparency of the procurement process under former Governor Gboyega Oyetola’s administration. The contracts, instead of being awarded through competitive bidding, were handed to ghost companies—further proof of how public funds are mismanaged.
Similarly, Oyo State faced scrutiny when the government awarded ₦694 million to produce notebooks. Investigations revealed that the cost per notebook was significantly inflated, far above standard market prices. Furthermore, the contracts were linked to individuals close to the administration, indicating clear conflicts of interest. Instead of prioritizing efficiency and cost-effectiveness, public funds were directed into the hands of political allies.
These cases demonstrate a pattern: government contracts in Nigeria are frequently overpriced, mismanaged, or awarded without due process. The FCT IRS’s Microsoft 365 deal may very well fit into this trend. While software licensing and digital transformation are necessary, the discrepancy between the market price of Microsoft 365 and the approved budget suggests that, once again, public funds may not be managed as efficiently as they should be.
For transparency, the FCT IRS should release a breakdown of what the ₦242.8 million covers. If additional services like training and security enhancements are included, they should be clearly stated. Otherwise, this project risks being seen as just another example of inflated government spending—one in a long line of questionable deals that have cost Nigeria billions.
