ICT Africa Headline News

Kenya to Launch Online Procurement System to Combat Corruption, Improve Efficiency

18 June, 2014

Source: Sabahi

Nairobi — Beginning next month, all government tenders, bids and contracts in Kenya will be posted online via the Integrated Financial Management Information System (IFMIS).

The Kenyan government has been testing IFMIS with the Treasury and select ministries since March 2012, and recently announced it is ready to roll out the programme to include all government ministries, departments and state corporations beginning July 1st.

The system aims to infuse transparency into the procurement process in an effort to rein in inflated prices, increase supplier competition and shorten the procurement-payment cycle.

With IFMIS, the government will announce all tenders online rather than in newspaper advertisements. Bids will be posted publicly, contracts will be awarded with transparency and contract payments will be made electronically, reducing the time and cost of doing business with the government.

The system also eliminates the need for vendors to visit government offices in person, thereby reducing the likelihood of bribes and corruption taking place, according to National Treasury Cabinet Secretary Henry Rotich.

"Intricate corrupt practices in government take place at the procurement offices and tendering boards," Rotich told Sabahi. "Therefore, the online tendering and payment system will ensure transparency and accountability of taxpayers' money."

"It is all-systems go come July 1 when the country rolls out IFMIS," he said.

Once the system is adopted, suppliers wishing to transact business with the government will have to do so through by registering their company profiles online.

"[With] that, we hope to minimise face-to-face interaction between government procurement officials and traders so that we can rein in [corruption]," Rotich said. "[IFMIS] will also save the government time and money spent in processing bids and reduce administrative tasks such as manual keying in of data."

Facilitating quick payments, standardising price of goods:

Jerome Ochieng, director of the IFMIS department at the Treasury Ministry, says he expects the rollout to be smooth.

Since May 2012, the government has trained more than 5,000 officers from the national and county governments on the new contracting procedures, and established an IFMIS academy at the Treasury in Nairobi to train additional employees, he said.

Ochieng added that the new system will also be better for suppliers.

"It will facilitate quicker payments for goods and services because there will be no delays occasioned by government officials manually sorting paperwork," he said.

The system is also expected to standardise costs because all goods will be listed in the system with their corresponding prices indicated.

"This way, the government hopes to check against traders who inflate the cost of goods," Ochieng said. "Cases of suppliers inflating the cost of their supplies are rampant. We have witnessed cases where different ministries pay very differing prices for the same item, yet it is supplied by the same trader."

IFMIS is also getting high marks from Controller of Budget Agnes Odhiambo, who said the system will give her officer more control over transactions and the disbursement of funds in the counties.

"The law is clear on how public finance is supposed to be spent, and therefore, the public has the undeniable right to know how state funds have been spent, by whom, how and what the expected value is," she said.

She said her office would be able to check on county transactions and decline to authorise withdrawal of funds should they have evidence that the money is being used for purposes other than what it is budgeted for.

Vendors welcome new system:

Dennis Ngujiri, managing director of Goshen Ventures, a company specialising in branded promotional merchandise, says he welcomes the expansion of IFMIS.

"E-procurement will save me the time I used to spend shuttling from one ministry to another as I delivered tender documents or quotes," he told Sabahi.

Ngujiri expressed optimism that invoices will no longer get "lost" when payments are due. "Since all documents will be transmitted and stored in electronic form, I hope the cartels in procurement divisions who are often accused of hiding these documents have now found their match in IFMIS," he said.

Last year, he said, his company won a tender to supply t-shirts to the Ministry of Health for its national anti-polio campaign. The contract was worth 3.6 million shillings ($41,070), and according to the agreement terms, payment was due after 60 days, but the ministry ended up delaying payment by another 30 days, according to Ngujiri.

"It was a bad period for my company. It thoroughly inconvenienced my cash flow because I had to decline or delay new tenders from clients since I did not have the capital to execute the work," he said.

Because of the delayed payment, Ngujiri was not able to pay a loan on his printing equipment, and was only able to pay his employees half of their normal salaries.

Edward Mureithi, who owns Comcart Enterprises, a company that provides lighting and decorations, said he was looking forward to using the new system.

"It will enable me and other prospective bidders to get access to tender opportunities without needing to buy daily newspapers where the government advertises supply opportunities," he told Sabahi.

Mureithi said IFMIS would save him the headache of calling ministries to find out whether his bids have been received or if he has won any contracts.

"Most of delays in government payments to vendors are caused by the absence of an invoice tracking system, lack of standardised payment schedules and insistence by chief accountants to physically verify hard copies of invoices," Mureithi said. "IFMIS will make all that easier so I have no reason not to trade with the government."

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