Procurement deadlock eases as government resumes IFMIS payments
In a circular issued on Monday, Treasury Principal Secretary Chris Kiptoo directed accounting officers to use IFMIS for pending bills, goods and services, and contracts signed before July.
The Treasury has allowed government agencies and counties to revert to the Integrated Financial Management Information System (IFMIS) for purchasing goods and settling bills, easing a three-month deadlock that nearly brought government operations to a halt.
The decision clears the way for payment of pending bills and obligations tied to contracts entered before July, as well as utilities such as water and electricity.
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It comes after the High Court on Monday stopped the rollout of the electronic government procurement (e-GP) system, which had been facing strong opposition from counties.
The government introduced e-GP in July to digitise all procurement activities, from tendering to supplier payment, as a way of sealing loopholes linked to ghost projects and diversion of funds.
The platform was meant to take over from IFMIS, which has long been the tool for procurement and payments.
However, delays and technical gaps in the new system left counties and agencies unable to buy goods or pay for services, sparking outrage from governors who said essential projects and services had been crippled.
In a circular issued on Monday, Treasury Principal Secretary Chris Kiptoo directed accounting officers to use IFMIS for pending bills, goods and services, and contracts signed before July.
“Accounting officers are advised to process payments for ongoing contracts entered into prior to July 1, 2025 in the IFMIS system. The e-GP system lacks records or data for such contracts as they were processed prior to the 1st July 2025 rollout,” Kiptoo said.
He further instructed that utilities should also be settled through IFMIS.
“In addition, in our circular letter referenced above (Ref. No. NT/ PPD/1/3/14 TY 3 (68) of 23rd July 2025), it was clarified that payment of utilities, e.g. water, electricity, rent and telephone expenses shall be processed in the IFMIS system in line with IFMIS procedure and NOT in e-GP,” the PS added.
Kiptoo emphasised the need for quick clearance of verified pending bills and obligations tied to ongoing contracts.
But he remained silent on how new development projects for the current financial year, worth Sh693.2 billion, will be handled.
This has created fresh uncertainty for counties and agencies that have gone more than two months without funding for new projects.
The procurement freeze over the past two months has affected budgets estimated at nearly Sh250 billion, based on the Treasury’s projection that procurement spending for the year will hit Sh1 trillion.
The new directive marks a reversal of Treasury’s earlier stance that all agencies and counties must use e-GP.
Last Friday, Head of Public Service Felix Koskey had instructed accounting officers to publish procurement plans on the platform by September 19, after Treasury uploaded national government budgets to the system.
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