Why CS Henry Rotich’s defence of the performance of IFMIS does not add up

Treasury CS Henry Rotich (PHOTO: FILE)

NAIROBI, KENYA: National Treasury Cabinet Secretary Henry Rotich was recently put to task to defend the Integrated Financial Management System (Ifmis) following recent reports of billions of shillings stolen from public coffers.

In an interview with KTN News, Mr Rotich said Ifmis did not provide full end-to-end e-procurement functionality and that the Government needed to install another e-procurement system.

“Ifmis has an e-procurement system but it is not as robust as a typical procurement system that has about 26 stages like we have,” he explained.

“What we are going to do is have a dedicated e-procurement system that will interface with Ifmis… and undertake the entire supply chain of procurement. The current system is not adequate, especially to deal with procurement and delivery of small items like what NYS does.” This is, however, not accurate.

Ifmis was first introduced in Kenya in 2003 with limited modules for automation and most processes remained manual for several years. The system was then re-engineered in 2012 under then Finance Minister Uhuru Kenyatta to include all ministries, Government departments, agencies and later counties.

This came at a cost of more than Sh10 billion to taxpayers, with Treasury saying the re-engineering would enhance efficiency and effectiveness in public finance management by bringing about end-to-end functionality.

The re-engineering involved end-to-end systems for, among other things, plan to budget, procure to pay and revenue to cash to help track key processes along the public finance system. 

Auditor General Edward Ouko last year tabled an audit of the Ifmis in Parliament, detailing strengths and weaknesses of the system and recommendations on sealing the loopholes exploited for graft.

In the report, Mr Ouko praised the technical capacity of Ifmis that provided for full end-to-end procurement in addition to linkages to other key systems such as the Central Bank of Kenya. “Payment processes across the Government of Kenya were activated in Ifmis, including the creation of purchase requisitions, the creation of purchase orders, perform fund availability check, perform inspection, recording of inspection and good receipt details, invoicing and processing of payments,” explained Ouko in the report.

“Integration of Ifmis with CBK for disbursing payments to suppliers was implemented successfully, whereby the payments processed through Ifmis had real-time linkage with the G-Pay system for effecting the EFT (Electronic Funds Transfer) payments.”

This means another e-procurement system would be a duplication of functions and costly to taxpayers while not tackling the causes of corruption in Government procurement.