Governors yesterday maintained their hardline stance and demanded that Treasury stops enforcing the electronic government procurement (e-GP) system, warning that it has paralysed operations.
The Treasury rolled out the e-GP in July to handle all public procurement processes, ending the previous model where entities procured goods and services independently and without central visibility.
Under the former system, entities would advertise tenders and proceed without submitting details to the Public Procurement Information Portal (PPIP), as many failed to comply with the requirement to upload documents.
The Council of Governors (CoG) accused the Treasury of forcing counties to use the digital procurement platform, which they say is riddled with challenges that have disrupted services in critical sectors such as health and agriculture.
However, delays in the uptake of the new digital platform have disrupted operations across counties and national government entities, with many unable to tender for goods and services required to run essential services.
On Monday, the CoG issued an ultimatum to the national government, demanding that proper consultations be held and county officers trained before the system is rolled out.
“We therefore call on the National Treasury to immediately withdraw the circular directing counties to implement the e-GP until proper consultations, legal alignment and capacity-building are undertaken,” said CoG Chairman Ahmed Abdullahi.
The e-GP is designed to digitise all procurement processes from the advertisement of tenders to final payment to contractors or suppliers.
Treasury has marketed it as a tool that will eliminate misallocation of funds, reduce pending bills, trace projects by location and expose the beneficiaries of public contracts.
Since April, Treasury and the Public Procurement Regulatory Authority (PPRA) have issued several circulars requiring all public entities to onboard the system and stop procurement outside it.
Last week, Treasury said it was responsible for uploading budget documents from the Integrated Financial Information Management System (Ifmis) to the e-GP before entities could begin procurement.
But since the start of the financial year in July, many institutions have been unable to proceed with procurement as Treasury has not uploaded their budget documents, leading to service disruptions.
“In Kiambu, we have heard today that 123 health facilities are averaging less than 20 percent in pharmaceutical supplies, and they cannot place orders. In some counties that support farmers with seeds before the rainy season, governors have warned that if seeds are not bought in the next two weeks, we risk losing the crop for this season,” said Governor Abdullahi.
Other reports indicated that vehicles belonging to a State agency have been grounded after their insurance expired, with the agency unable to procure a new cover through the e-GP.
Counties insist they are not opposed to digitisation but argue that the national government should address problems highlighted during the system’s piloting phase before making it mandatory. They claim that even the three counties that piloted the platform are struggling to make it work.
Governors also warned Treasury CS John Mbadi against threatening to withhold counties’ equitable share of revenues for failing to use the e-GP.
“If it’s not working, it’s not. No one can shove it down our throats. You must address the issues we are raising. And you must respect that we are two levels of government, both creations of the Constitution of Kenya,” Mr Abdullahi said.
Treasury has estimated that Sh1 trillion worth of procurement will be conducted this financial year, all of it required to go through the e-GP. This translates to about Sh250 billion in the first quarter ending September 30—underscoring the magnitude of delays already experienced.
President Ruto on Sunday accused unnamed rogue officials of sabotaging the system in order to continue exploiting the old procurement methods, which have been linked to malpractice and inflated prices.
“We are going to implement e-procurement; there is no going back. Any official not ready to work with us on e-procurement can as well leave government and do something else,” Dr Ruto said.
Governors dismissed the remarks, saying they were directed at national government officials, not counties.
“The President is the chief executive of the national government. If this system is properly demonstrated to us and shown to work for the benefit of the country, that’s a conversation we’re willing to have. But not through threats or intimidation,” Mr Abdullahi added.
Counties accuse Treasury of portraying them as resisting accountability while forcing them to adopt a system that is yet to function effectively, thereby freezing their operations.
Implementation of the e-GP follows a 2017 review of the old procure-to-pay module, which was faulted for weak compliance with procurement laws, poor contract management, delayed payments, and weak data management.
Public procurement accounts for a large share of government expenditure. PPRA records show that 54,354 tenders were published on the PPIP in 2023/24, mostly for goods (52 percent), works (28 percent), and non-consultancy services (18 percent). Contracts worth Sh262.76 billion were published during the year, although many entities still failed to comply with requirements to publish all contracts.
Infuriated governors also accused Health CS Aden Duale and Medical Services PS, Dr Ouma Oluga, of attempting to set them up against the 7,414 Universal Health Coverage (UHC) medics deployed across all 47 counties . The CoG claimed the Ministry of Health is pushing a narrative that counties have refused to employ the medics on permanent and pensionable (PnP) terms, instead of providing adequate resources to facilitate their absorption.
According to CoG Chair Ahmed Abdullahi, counties require Sh17.1 billion to fully transition the health workers to county payrolls.
The amount includes Sh7.7 billion for transferring the payroll to counties in line with SRC rates, Sh9.4 billion in gratuity payments for UHC staff currently on contract and Sh4.77 billion for outstanding salary reviews for county workers for the 2024/25 financial year.
“We have not refused to employ UHC staffers. That’s not the case. All we are asking is that rather than provide money for only seven, eight, nine, or 10 months and leave us with the problem of absorbing these people, why not provide sufficient resources to keep these young Kenyans on PnP in perpetuity? We have a Sh4.2 trillion national budget,” said Mr Abdullahi.
He warned that forcing counties to take over the payroll without addressing gratuity and resource allocation would only spark more unrest:
The county bosses also insisted that the ongoing verification of UHC staff must be validated jointly and shared officially before any transfer process begins.
“The ministry continues to paint a picture that county governments are derailing absorption, yet health is a devolved function. The national government implemented salary reviews for its workers in FY 2024/25, but this was not extended to county workers due to lack of Treasury allocation,” Mr Abdullahi added.
The CoG is now demanding an increase in the equitable share to facilitate the implementation of the salary review, in line with the law.
Last week, CS Duale announced that out of 7,629 UHC staff verified, 215 failed to present themselves. These, he said, were identified as ghost workers or unqualified health professionals, leading to their removal from the payroll.
The remaining 7,414 staff will be placed in two categories—those in active service and those facing disciplinary cases.
“This process underscores our commitment to reforms in the health sector. The ministry is resolved to ensure fairness, accountability, and transparency in the absorption process while safeguarding the rights of eligible officers,” Mr Duale said.
The UHC programme was launched five years ago at the height of the Covid-19 pandemic, when 8,571 medics were hired on contract under promises of permanent terms and gratuity—promises that remain unfulfilled.
Van Asae, the UHC national pharmacology technologists’ representative and chair of UHC staff in Kajiado County, accused governors of persistently rejecting absorption.
“For five and a half years, we have endured multiple transfers—some more than four times—with no disturbance allowances, as counties said we were not their employees. When PSC recommended our absorption and gratuity in 2023, governors rejected it. This forced us to stage demonstrations nationwide. Parliament eventually allocated Sh6.2 billion in the FY 2026/27 supplementary budget to facilitate our absorption. Now that funds are available, CoG is again blocking our absorption,” he said.
He further alleged that some governors want funds diverted so they can replace legitimate UHC staff with relatives and cronies, jeopardizing healthcare access for millions.
The medics are now demanding the establishment of a Health Service Commission to shield the sector from political interference.
Meanwhile, the Health Sector Caucus has notified police of a peaceful procession by UHC staff on Tuesday, September 2, 2025.
“About 5,000 UHC staff across 17 cadres will march from Green Park Terminus at 8:00 a.m. to the MoH, CoG, and PSC offices. We are demanding gazettement of UHC data post-audit, commitment to gratuity payments with clear timelines, and implementation of the delayed return-to-work formula,” said caucus chair Peterson Wachira in his request for police security.
