Concerns Raised Over Kenya’s IFMIS Procurement System

A report from the US has raised concerns regarding the Kenyan government’s Integrated Financial Management Information System (IFMIS), citing challenges with transparency and fairness in the procurement process.

IFMIS, an Oracle-based Enterprise Resource Planning (ERP) system, is designed to bolster accountability and transparency in public finance management, including budget formulation, procurement, and financial reporting, both at the national and county levels.

In a recent report, US firms expressed reservations about the procurement practices mandated by initiatives such as “Buy Kenya, Build Kenya,” which require government entities to procure a significant portion of their supplies locally. Additionally, regulations like the 2016 Public Procurement and Asset Disposal Act (PPADA) prioritise Kenyan-owned firms and goods manufactured or mined domestically.

The report highlights concern over security vulnerabilities in the IFMIS system, along with issues related to connectivity and technical capacity within county governments. Furthermore, challenges such as apathy among county officials and central control shutdowns have been identified as obstacles to fair play in the procurement process.

Acknowledging the requirement for all tenders and procurements to be conducted through IFMIS since January 2019, the US report has shown the limited success of American firms in bidding for Kenyan government tenders, citing corruption as a significant concern. Foreign participants in Kenya’s telecommunications market have also expressed frustration over long delays in the licencing process, contributing to an unpredictable regulatory environment.

Regarding real estate investments, the report highlights risks associated with undeveloped land, including the potential for fake title deeds and unauthorised sales. While the leasing process for developed land is relatively clear, obtaining a clear title for undeveloped land remains opaque and unreliable under current regulations.