Govt to Fully Enforce eGP System from July, Mbadi Confirms

Govt to Fully Enforce eGP System from July, Mbadi Confirms

The government will fully enforce the electronic Government Procurement (eGP) system across all public institutions from the next financial year, with no exemptions allowed, Treasury Cabinet Secretary John Mbadi has confirmed.

Speaking during a television interview on Sunday, April 12, Mbadi said the move is aimed at sealing long-standing procurement loopholes that have contributed to the loss of billions in public funds and increased pressure on the national budget.

He noted that while some government entities were granted temporary exemptions during the current rollout phase, the system will now be fully implemented beginning in July.

“If we can have a system like eGP, which is rolled out fully, we can close these procurement loopholes. I know we gave some exemptions this year, and I am saying this today, next financial year, there will be no exemptions for eGP,” Mbadi stated.

The electronic Government Procurement system is a digital platform designed to streamline and monitor all stages of public procurement, including tender advertisement, bidding, evaluation, contracting, and payments. It is intended to improve transparency, accountability, and efficiency in government spending.

Under the current transition phase, several institutions have continued using manual procurement processes as they prepare for full integration into the digital system. However, the Treasury says this arrangement will end once full rollout is completed.

Mbadi emphasized that procurement remains one of the most vulnerable areas for wastage of public resources, often due to inflated pricing and unethical practices.

“Where we waste money is actually on the procurement side, where instead of procuring a hall for Ksh15,000, you procure for Ksh50,000, and the surplus is shared in between,” he said.

The Treasury CS also acknowledged that the government faces significant constraints in reducing overall expenditure, citing pressures from the public wage bill and demands from various sectors, including security and labour agreements.

“We have limited space in terms of cutting expenditure. You look at our wage bill. We are getting pressure from CBAs, the security sector, and in terms of increasing salaries and the inflation index,” Mbadi explained.

He further cautioned that aggressive cuts in recurrent expenditure could have unintended economic consequences, particularly on businesses that rely on government spending.

Instead, the government is shifting focus toward rationalising development spending by prioritising viable projects and reviewing those deemed non-essential or unsustainable.

Mbadi also addressed the growing reliance on supplementary budgets during the current financial year, acknowledging that frequent revisions are not ideal for fiscal planning.

He attributed the need for adjustments to gaps in initial budget planning, including unaccounted donor-funded projects and newly arising salary obligations.

“Poor planning. We left out some donor-funded projects which we had to expand. Number two is Personnel Emoluments. Some CBAs had been suspended by court, and we became liable, and we had to pay,” he said.

Meanwhile, Treasury data indicates that domestic borrowing has been significantly increased in the current financial year ending June 30, with the government expanding its borrowing target by 52.29 percent, equivalent to about Sh570 billion.

Economists warn that the increased reliance on domestic borrowing could tighten credit availability for households and businesses, potentially pushing up interest rates and slowing private sector growth.

The full rollout of the eGP system is now being viewed as a key reform in improving fiscal discipline, with policymakers hoping it will enhance transparency and reduce leakages in public procurement once fully operational.

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Govt to Fully Enforce eGP System from July, Mbadi Confirms