Implement e-government system adopting Open Contracting Data Standard (KE0025)

This commitment will implement a national end to end e-government system adopting the Open Contracting Data Standard (OCDS), to cover all stages of public procurement in Kenya. The system will be interoperable with all other government E-Systems. This commitment will ensure more efficient delivery of public goods and services, and increased opportunities to do business with government for all citizens. This includes increased opportunities for Women, Youth and Persons with Disability under the Access to Government Procurement Opportunities (AGPO) initiative.

Objective To ensure reduced fraud and corruption, increased transparency, accountability, value for money, competitiveness, and authenticity of all public procurement processes. This includes all emergency procurement during the Covid-19 pandemic. The system will also boost performance on public contracts, deliver more efficient planning, monitoring, evaluation, audit and reporting of public procurement.

Status quo: Since 2003, public procurement in Kenya has been done through the country’s Integrated Financial Management Information System (IFMIS). Despite a number of public finance management reforms including the adoption of IFMIS, procurement in Kenya has not yet achieved the threshold of accountability, transparency, competition, equity and inclusivity envisaged in the Constitution of Kenya 2010 and the Public Procurement and Asset Disposal Act (PPDA) 2015. More is needed to be done to strengthen the processes, controls and oversight of each stage of procurement. Additionally, improvements are needed in publishing high quality open data on all stages of procurement including planning, tendering, awarding, contracting, implementation and oversight. Finally, more robust public participation as envisa

Ambition The commitment seeks to achieve maximum impact and accountability of public funds expenditure on behalf of citizens; effective delivery of goods and services, stimulate market opportunities including for Women, Youth and Persons with Disability, support diversification of supply chains, and increase checks and balances for emergency procurement - particularly in the Covid-19 pandemic response and recovery period.

No. Verifiable and measurable milestones to fulfill the commitment Status of milestone Start Date End Date 1. Publish beneficial ownership information on foreign and local companies bidding for and winning mining contracts Ongoing February 2021 June 2022 2. Ensure the new end to end e-government procurement system is interoperable with open contracting portals developed by national and devolved governments set up for public funds management New February 2021 December 2021 3. Amend PPDA 2015 to strengthen and encourage whistleblowing with a clear definition and scope of (robust and comprehensive) protection. Offer protective and easily accessible anonymous whistleblowing channels New February 2021 December 2021 4. Develop draft national and county open contracting policies, acts and regulations to guide the data collection, disclosure and management of the E-Government Procurement system which adopts the Open Contracting Data Standard (OCDS) New February 2021 December 2022 5. Fully operationalize the Public Procurement Information Portal (PPIP) with 100% of all procuring entities registered and actively submitting all information on the portal as per Executive Order No. 2 of 2018 in a timely manner. Information provided for publication to the PPIP by should include both foreign and local companies bidding for contracts in Kenya New March 2021 January 2022 6. Publish all quarterly, annual and periodic reports generated under the Public Procurement and Assets Disposal Act (PPDA) 2015, on the Public Procurement Information Portal (PPIP) for transparency New March 2021 December 2022 7. Adopt low tech/rural connectivity information dissemination mechanism for all Access to Government Procurement Opportunities (AGPO) documentation (including providing hard copies of documentation) as per provisions of the Access to Information Act 2016 New April 2021 April 2022 8. Develop a mechanism to ensure that public feedback through the project life cycle is documented and meaningfully channeled into decision-making New April 2021 April 2022 9. Enactment of national legislation and an enabling framework for comprehensive Whistleblower Protection in Kenya. This legislation will provide a clear scope of protected disclosures, protected persons and control measures to facilitate whistleblowing New April 2021 December 2022 10. Develop and implement joint public awareness campaign on measures for protection of whistleblowers with civil society New May 2021 December 2022

Action Plan Review

Commitment 2. Open Contracting

● Verifiable: Yes

● Does it have an open government lens? Yes

● Potential for results: Substantial

Lead institution: Public Procurement and Regulatory Authority (PPRA)

For a complete description, see Commitment 2 in Kenya’s 2020–2022 action plan at: https://www.opengovpartnership.org/documents/kenya-action-plan-2020-2022/.

Context and Objectives

Kenya has prioritized addressing corrupt contracting in two previous action plans. Both government and civil society stakeholders from the Kenyan OGP community recognize the need to increase transparency and accountability in all public procurement processes to reduce fraud and corruption. Public procurement in Kenya is subject to corruption and bribery, with various assessments implementing high levels of public fund losses. GAN Integrity’s Risk & Compliance Portal (formerly The Business Anti-Corruption Portal) noted that tender fraud was the fastest growing economic crime in Kenya and coded the risk level as high. ^[1] Transparency International ranked Kenya 124^th out of 180, with a Corruption Perception Index rating of 32 out of 100. [2] The Ethics and Anticorruption Commission showed that over 72% of respondents both from government and private suppliers agreed that corruption was widespread in public procurement. [3]

The government has promoted open contracting, with previous commitments focusing on open contracting data standards, inclusion via the Access to Government Procurement Opportunities (AGPO) initiative, access to information through data portals, and providing legislative frameworks. Amendments to the Public Procurement and Asset Disposal (PPAD) Act of 2015 effected the AGPO, which made a significant impact in including traditionally disadvantaged groups such as youth, women, and people living with disabilities (PWD). The Public Finance Management (PFM) Act of 2012 further articulated the scope and guidelines for open contracting and created frameworks for financial oversight, budget planning, public participation, and obligations of state officers.

The combination of the PFM Act and the PPAD Act enabled the creation and operation of the Integrated Financial Management System (IFMIS). IFMIS fully caters e-procurement, and importantly, publishes open contracting data on its Public Procurement Information Portal (PPIP).

In Kenya’s third action plan, the government sought to implement Open Contracting Data Standards (OCDS) on the PPIP, while supporting women, youth, and PWDs to participate in public procurement. However, the OCDS were not implemented, and though more information was published on the portal, this did not cover all public procurement by all government entities. ^[4]

Efforts thus far have focused on creating structures for open contracting and publishing information. However, challenges still exist to these processes. The legal provisions for open contracting are limited in scope, only requiring publication of information on the pre-tender and tender-and-contract award processes. ^[5] Open contracting initiatives were hindered by limited understanding and capacity of implementing officers, as well as low political will. Additionally, the legacy systems in use are outdated, and incompatible with OCDS open data formats. ^[6] However, some recent trainings and advocacy have caused positive changes. 

Kenya’s Institute of Economic Affairs noted that while the pre-tendering and tendering stages of public procurement often have transparency measures, corruption is reported more during the post-tender award processes, where there is limited publication and disclosure of information. ^[7] Additionally, most information provided on the PPIP refers to historical data and does not reflect ongoing contracts, nor does the portal provide gender disaggregated data. ^[8]

Another challenge to public procurement is victimization. Most economic corruption and malpractice goes unreported, mainly due to a fear of victimization. ^[9] Kenya does not have a comprehensive and dedicated law on whistleblower protection, although a legislative proposal was submitted to a national assembly subcommittee on 12 August 2020. ^[10] Currently, whistleblower protection is covered piecemeal under laws like the Access to Information Act (2016), the Anti-Corruption and Economic Crimes Act (2003), the Witness Protection Act (2012), and the Bribery Act (2016). The lack of a comprehensive legal safeguard for whistleblowers is a weakness in the country’s fight against corruption.

This commitment continues open contracting efforts toward inclusion, access to information, provision of legislative and policy frameworks, adoption of data standards, and includes a new focus on whistleblower protection. It tackles national and international contracts. It builds on existing implementation of an e-government procurement system that: uses the open contracting standard; is interoperable with existing portals; and captures all information from all procuring entities. The commitment further aims to provide regulatory frameworks for implementing the e-government procurement system at national and county levels and for whistleblower protections, while creating mechanisms for public feedback throughout the project lifecycle.

Regarding inclusion in public procurement, most AGPO-targeted beneficiaries live in rural areas with limited internet connectivity. ^[11] However, the National Treasury publishes tender and contract information online. This prompted Milestone 7’s low-tech dissemination of information and engagement. Milestone 8 proposes spaces for citizens to raise concerns and provide feedback on projects, without having to wait for a call for information by the Public Procurement Regulatory Authority or any other aggrieved party.

Milestone 1, which proposes to publish beneficial ownership information on foreign and local companies who bid for and win mining contracts, speaks to both open contracting and beneficial ownership. It furthers implementation of a commitment on publishing oil and gas contracts, started under the second national action plan (NAP). ^[12] The IRM’s end-of-term-report suggested contracts were not published because of legislative gaps and recommended that government begin steps to publish oil and gas contracts. ^[13] This legislation was passed as part of Kenya’s third action plan and the beneficial ownership registry was set up by the end of the plan’s implementation period.

The commitment is relevant to OGP values of transparency and civic participation. While the commitment does not expressly demonstrate accountability, it could enhance accountability by clearly detailing how citizen feedback will be collected and processed, and establishing links between feedback mechanisms and redress actions.

Potential for results: Substantial

This commitment addresses different aspects of public procurement including the lack of unified data on open contracting, ^[14] inclusion and participation by marginalized groups, and whistleblower protection. Publication of information and use of online platforms have been adopted across countries as best practices to enhance transparency, integrity, and efficiency in public procurement. ^[15] Furthermore, the United Nations Economic and Social Commission for Asia and the Pacific reviewed best practices for disability-inclusive public procurement in the USA and EU. [16] Some lessons learned are:

(i) Inclusion initiatives must have enforcement power; either stringent enforcement mechanisms or giving incentives to responsible parties are effective ways to enhance implementation of any law or regulation.

(ii) Capacity building for all targeted stakeholders support development and implementation of disability inclusive procurement policy.

(iii) Involving civil society organizations and the private sector in developing and implementing disability-inclusive procurement policy is key for success. ^[17]

Establishing an e-government procurement system and making it interoperable with existing platforms should ensure seamless regulation of national- and county-level procurement activities. The e-government system, together with a fully operationalized PPIP will result in a functional government procurement system that provides unified data on open contracting. Adopting OCDS will bring the system in line with international best practices and provide procurement information in machine-readable format, in real time, and which is interoperable with existing platforms, thus easing the burden of design and installation. This could improve access to information and quality of due diligence actions, shorten procurement times, promote participation, and enhance the efficiency of monitoring contracting processes by government, CSOs, and the public. [18] Furthermore, development of an open contracting regulatory framework will provide enforceable mechanisms to guide data collection, disclosure, and management of e-government procurement systems for both national and county governments.

Whistleblower protection is critical to combat corruption. By enacting a stand-alone national legislation, amending procurement regulations, and providing an enabling framework for comprehensive whistleblower protection, Kenya will commit to ethical government business. Clearly defining the scope of protection will ensure that reporting platforms are robust and reliable, will minimize risk of victimization, and promise whistleblowers that the reported concerns will be dealt with appropriately. The commitment will also educate CSOs on whistleblower protection, with the aim of encouraging citizens to report corrupt practices.

Finally, providing information through low-tech and rural mechanisms is a positive step to encourage uptake of AGPO opportunities. However, this could be augmented with other initiatives such as entrepreneurial capacity building for citizens, and businesses monitoring, as discussed in the design report.

Opportunities, challenges, and recommendations during implementation

Moving forward, the IRM recommends the following:

● Ensure strong collaboration between the National Treasury and the Public Procurement Regulatory Authority: According to one interviewee, the National Treasury lacked responsiveness and was not as collaborative as desired. The 2018–2020 design report noted similar challenges facing the county government of Makueni, which was also implementing an open contracting commitment. The government will need to address this to avoid uncalled-for impediments to the commitment.

● Give explicit measures to strengthen accountability: The 2018–2020 design report stated that using OCDS on the portals does not automatically reduce corruption. Kenya should explain how these measures will be used to reduce corruption. The government could detail how the PPIP can be linked with the beneficial ownership register to enable verification of company details. This could also be linked to oversight and anticorruption authorities such as the Ethics and Anticorruption Commission, the anticorruption legal courts, and prosecution authorities for better access to and utilization of information. Additionally, the government could demonstrate how citizen feedback will be collected and processed, and establish links between the feedback and redress actions.

● Regularly train public officials on the laws and documentation standards: Implementers of this commitment could collaborate with the implementers of Commitment 6 (access to information) to develop standards for, and promote digitization of, records to enhance adoption of the open contracting data standards. Equally, the commitment stands to benefit from the curriculum training on access to information if the implementers include procurement officers and related personnel for capacity building.

● Promote citizen use of contracting information: Build partnerships, hold trainings, and conduct awareness campaigns to improve dissemination and promote data use by the government, CSOs, and the media.

● Encourage peer exchanges to learn from past experiences: The national government can study the experiences of two county governments, Makueni and Elgeyo Marakwet, who have implemented OCDS. There is an even greater opportunity for peer learning among other county governments, such as through the county peer-review mechanisms detailed in Commitment 5. Flagship initiatives such as this one could be recommended for adoption across all counties, and the Council of Governors tasked to ensure and monitor its implementation. 

Results Report

Commitment 2. Open Contracting

Commitment 2: Open Contracting [Public Procurement Regulatory Authority (PPRA)]

Context and Objectives
The aim of this commitment was to implement a transparent e-government procurement system to enhance transparency and accountability in all procurement processes, and to reduce the chances of fraud and corruption. At position 124 out of 180 in the Corruption Perception Index, Kenya is perceived to be a highly corrupt country, whereas public procurement is one of the greatest avenues through which corruption is carried out. [7] Successful implementation of this commitment would have promoted open government and assisted the fight against corruption.

This commitment built on previous efforts [8] to strengthen public procurement and beneficial ownership transparency under prior action plans. During the 2018–2021 action plan, civil servants, the media, and civil society were trained on the Open Contracting Data Standard (OCDS). Additionally, the Kenyan Business Registration service established an internal beneficial ownership register and granted the PPRA read-only access. [9]

Some of the challenges foreseen during action plan review included the non-responsiveness of the National Treasury, lack of mechanism to incorporate citizen feedback, capacity gaps among public officials implementing the commitment, lack of awareness among citizens, and the inability to see through the commitments carried over from previous action plan cycles. Addressing these challenges would have been key in the implementation of this commitment.

Did it Open Government? Marginal
This commitment achieved marginal progress towards Kenya’s longstanding aim to open public procurement to combat corruption. During the implementation period, the PPRA made the Public Procurement Information Portal (PPIP) fully operational, but efforts were still ongoing to achieve 100% compliance of procuring entities. Likewise, PPRA was continuing efforts to increase the compliance of companies to disclose beneficial ownership information, which was not fully achieved. Government and civil society partners also made progress on the transition to a comprehensive e-government procurement system and the finalization of a whistleblower legislation and reporting channels, but neither was finalized by the end of the cycle.

The overall level of completion of Commitment 2 is limited. Out of its ten milestones [10], four (milestones 3, 9, 10 and 7) were not started; whereas three (milestones 1, 5, and 6) progressed substantially. The other three (milestones 2, 4, and 8) achieved limited completion.

Milestone 1 aimed to publish the beneficial ownership information of companies that won mining contracts through collaborative implementation under the beneficial ownership commitment. Some progress was made, such as maintaining a fully operational PPIP portal where information on publicly procured contracts are made accessible to citizens, but it was only partially complete. On the PPIP portal, sections requiring the inclusion of details on the directors and beneficial ownership information of procuring entities are also provided. However, out of the procuring entities sampled in the portal during the research, no information on beneficial ownership is included. A PPRA representative stated that not all the entities have complied with the requirement to publish their beneficial ownership in the portal. [11] Late in 2022, the PPRA Director General issued a circular requiring all companies to comply by 1 July 2023. [12] As such, it is impossible to easily identify which companies won mining contracts from the data provided.

The second milestone sought to establish a new e-government procurement (EGP) system that was interoperable with the open contracting portals developed by national and devolved governments but was only partially completed. The national government’s procurement system is currently largely automated through the Integrated Financial Monetary Information System (IFMIS). Save for Makueni and Elgeyo Marakwet, [13] no other counties had a fully automated/open contracting system. Through this commitment, the government wanted to migrate from IFMIS to a new EGP system that would be interoperable with the PPIP to avoid duplication and have a centralized portal where data relating to procurement from all other entities can be published. [14] At the time of writing this report, the commitment co-leads stated that a new contractor had been brought on board to support the development and piloting of the e-procurement system. [15] However, it is worth noting that there was some evidence of enhancement of the IFMIS thanks to the introduction of a ‘Supplier Invoice Tracking Solution’, which renders it possible for one to track both the status of a supply as well as the processing of the supplier’s invoice. [16] Although this was not done in line with any specific NAP IV commitment, the improvement was made during the current action plan cycle and is likely to enhance the openness of government projects and reduce procurement fraud.

Milestones 3, 9, and 10 related to strengthening the whistleblower legal regime in Kenya [17] in order to encourage persons who are aware of unscrupulous dealings in the procurement process to come out publicly with the assurance that their safety is guaranteed. All three milestones were not started. PPRA and Development Gateway representatives stated that this milestone was broad and required a collective and collaborative approach to its implementation, especially with the public participation commitment cluster, since issues of whistleblowing were cross-cutting. [18] Although they remain incomplete, the researcher came across evidence of the introduction of the Whistleblower Protection Bill [19] at the committee stage in the parliament, as well as the Protected Disclosure Bill, which aimed to strengthen the regime once it is passed into law. [20] Notably, the PPRA has also developed two systems of filing complaints anonymously in relation to procurement processes, although they had not yet been launched publicly. [21]

Milestone 4 sought to develop open contracting policies among national and county governments but was still at the initial stages of deliberations on how to proceed with implementation. According to Development Gateway, interoperability workshops were held with four counties and other cluster lead actors such as the PPRA and the National Treasury to discuss what the commitment entailed, next steps, as well as identify the technical and policy needs. [22] Makueni County commenced the process of developing its open contracting policy before this NAP made substantial progress in finalizing on the county draft policy. [23]

Substantial progress was made under milestone 5, which committed to fully operationalize the PPIP and ensure 100% registration of government suppliers. The PPIP portal is fully operational and provides for the registration of procuring agencies. [24] It also has a list of the all the registered procuring agencies and the particulars of the said agencies, including details of contracts awarded. [25] In June 2022, the lead agency issued guidelines for Registration and Licensing of Procuring or Asset Disposal Agents. The authority gave procuring entities that do not have the capacity to establish an internal procurement department the liberty to employ the services of these firms, which must be registered by the lead agency. [26] Although the registration portal for procuring entities is active, the PPRA noted that one of the key challenges of fully implementing this milestone was the non-compliance of some procuring entities. [27]

While the IRM did not receive information on the extent of compliance, the PPRA had not attained 100% registration at the time of writing this report. [28] However, the PPRA published periodic reports summarizing statistics on the number of tenders and contracts, as well registered procuring entities and suppliers per financial year in compliance with milestone 6. [29] Milestone 7, aimed at adopting low-tech connectivity information dissemination mechanisms, was not started due to lack of financial resources. [30]

Finally, milestone 8 sought to develop a public feedback mechanism during a project’s life cycle that could inform decision making. At the national level, there is no systematic way of receiving feedback, although the PPRA is set to launch the two aforementioned systems for submitting complaints. A PPRA representative noted that currently, feedback is provided through channels such as social media. [31] At county level, the Makueni county put in place a structured mechanism for monitoring and feedback of public projects, including the county government level at the top and the village level at the base. [32] This feature could be borrowed by the national government as well as other county governments to increase the openness of public projects and remove the loopholes that are often exploited for corruption. A Development Gateway representative stated that Nandi and Elgeyo Marakwet counties are in discussions to roll out similar mechanisms. [33]

This commitment is crucial and has great potential to significantly open government, even though its implementation was limited in this action plan cycle. The PPRA stated that the information on the PPIP has been useful in supporting them to carry out its mandate of monitoring, conducting assessments, and giving advise based on identified trends and issues. The system also generates reports on specific aspects such as direct procurement contracts that were terminated. [34] Some of the challenges attributed to the limited implementation of this commitment included limited scope of open contracting legal provisions, limited capacity of implementing officers, the use of outdated systems that are incompatible with the OCDS, the absence of comprehensive framework for the protection of whistleblowers, the political climate preceding the August 2022 general elections, lack of political goodwill, and poor resourcing. [35]

Looking Ahead
Some of the recommendations on strengthening this commitment into the future included technical and policy changes at the PPIP and county systems to allow system integration, regular review process to monitor implementation, capacity building for implementers, and adequate financing for implementation. The IRM recommends the following: