Small ICT firms fear they may lose out in county contracts


Local technology firms have expressed fears that they might be locked out of lucrative revenue collection contracts by the county governments.

The companies noted that the framing of the expression of interests (EOIs) to develop revenue collection solutions by the counties appear to be slanted in favour of multinational technology firms. Most of the EOIs heavily borrow from what the national government has in the past used when looking for financial management systems, with the county governments having failed to scale them down to match their needs.

The counties are pressed to comply with requirements of the Public Finance Management Act as well as mainstream and seal revenue collection leakages. In the four months to June, counties lost more than Sh1.5 billion due to revenue leaks. A Controller of Budget report released in August noted that that the revenue collection in the months since March, when the county governments came into place, dropped.

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The counties are now looking for companies that will develop back-end systems expected to seal the loopholes. The search is however said to have locked out local firms.

“The EOIs have been designed in a manner that is hard for local small and medium firms... multinationals have bid for these jobs and given their muscle and the fact that they are looking for long term gain, SMEs might not have a chance,” said an official with a local firm that has tried to get.

Accurately map out

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Victor Kyalo acting chief executive ICT Authority however said local firms stood to gain, noting that there is a likelihood that developing back-end solutions for county governments would prop up small IT firms into medium and even large enterprises. He added local companies have adequate capacity locally to develop solutions, which is what the county governments are looking for at the moment.

“Everybody I have talked to seems to have a solution and there is a huge opportunity for companies to grow, if anything I see a situation where some companies will emerge in a huge way,” he said.

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“There is a big opportunity for businesses with outlets in the counties, where they can be used by the counties for revenue collection. People doing business in the counties can easily pay their fees through these outlets. The user interface is developed and what the counties are looking for are backend.”

 Kyalo added that the Authority is currently working with county governments to develop ICT master plans that would help accurately map out the revenue streams available to them at their local level.

“The defunct local authorities had systems that cannot work today… we are currently drawing up ICT master plans with the counties.”

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county governments Public Finance ICT