A damning audit by Auditor-General Nancy Gathungu has revealed massive financial accountability failures within Kenya’s eCitizen digital payments platform. Billions of shillings are unaccounted for, raising fears of misuse and jeopardising the delivery of critical services by government agencies.
Highlights:
- KSh 9.6 billion flagged as questionable in eCitizen transactions
- Treasury failed to sign agreements with key financial service providers
- KSh 7.05 billion sits unremitted in collection accounts
- KSh 2.57 billion in receipts could not be linked to any invoices
- Discrepancies in reported collections threaten public service delivery
Main Story:
Kenya’s Auditor-General Nancy Gathungu has raised fresh concerns over the management of public funds on the government’s flagship eCitizen platform, which hosts over 22,000 services offered by key state agencies.
In her latest audit for the financial year ending June 30, 2024, Gathungu flagged more than KSh 9.6 billion in questionable transactions due to inadequate financial controls, system inconsistencies, and lack of oversight by the National Treasury.
At the heart of the audit is the Treasury’s failure to establish formal Service Level Agreements (SLAs) with financial service providers responsible for collecting and disbursing payments on the platform. As a result, KSh 7.05 billion remains unremitted in collection and settlement accounts, with no legal framework guiding how or when these funds should be transferred.
The Auditor-General warns that without these agreements, there’s a risk that service providers could misuse the funds, leading to delays or disruptions in the operations of ministries and agencies that depend on timely revenue remittances.
The audit also uncovered KSh 2.57 billion in receipts that could not be matched to any invoices on the Pesaflow system the backbone for eCitizen payments. These irregularities stem from partial, duplicate, or erroneous transactions, which the AG says expose the system to fraud and misappropriation.
“There’s a serious lack of traceability,” the audit states, adding that this undermines accountability and compromises delivery of essential services.
Further scrutiny revealed worrying inconsistencies in how funds are reported and settled. In one case, the Government Digital Payments (GDP) Unit claimed that KSh 2.24 billion was owed to the Tourism Fund, but settlement records only reflected KSh 1.72 billion a shortfall of KSh 515 million.
“These reporting gaps show the eCitizen platform is not generating reliable financial reports,” Gathungu noted.
This is not the first time eCitizen has come under fire. In a previous audit for the year ending June 2023, Gathungu had already questioned the accuracy of KSh 15.5 billion in reported collections. The ongoing concerns point to systemic weaknesses in the platform’s ability to handle and account for government revenues.
The platform is operated by a private consortium called ECS LLC, made up of Webmasters Kenya (which manages customer support), Pesaflow (cash collection), and Olive Tree Media (bulk messaging and security). Initially developed in 2014, eCitizen became a key pillar in the government’s digital transformation agenda under former President Uhuru Kenyatta.
But despite its growth, the AG’s findings suggest that the digital transition has outpaced the systems designed to manage it with real consequences for service delivery across MDAs and county governments.
vernment services can’t track its own billions, is Kenya’s e-governance dream turning into a digital nightmare?
