Kenyans might soon be forced to go back to their bureaucratic way of accessing government services as senior state officials are now actively fighting the founders of eCitizen as they position their entities to take over the management of the platform.
According to sources within the Treasury and Office of the President, a team of officials led by Sydney Wachira of Goldrock Capital, Harry Mwangi are part of the influential government employees who have even formed a company called Value Chain Factory Limited to take away the business of digitising and managing the eCitizen platform away from Webmasters Kenya.
But a team of well connected individuals are believed to be behind the real scheme. While the Accountant General in the Treasury, Bernard Ndungu, previously resisted and demanded accountability in the transactions, he is now seen as part of the group demanding private control of the eCitizen earnings through fictitious entities.
Late meetings are said to be held at the Office of the President with Sydney Wachira always walking into the office of Principal Administrative Secretary, Stephen Kegoro, to join Bernard Ndungu and others in the meeting.
To complicate matters, the Accountant general has suddenly become a great drinking buddy of the Harry Mwangi who is known to be the mastermind of the whole deal.
Since April, the government has blocked the Webmasters Kenya group from accessing the convenience fee charged on top of cost of government service as there was no framework on why a non-gazetted payment should be charged on a government system.
The eCitizen platform was developed under a World Bank funded program to create a single convenient platform of accessing government services. World bank paid eCitizen Ksh 70million as a one off fee. The company owners and well connected state officials went ahead and saw the need to charge some “convenience fee” on the platform.
As of July, more than Ksh. 900million had been earned on the service as convenience fee. The money was wired to a KCB account where it was illegally withdrawn and used against the law. The National Payment Systems Act is clear that only Central Bank may allocate such payment to authorised payment after collection.
In June, Goldrock Capital Limited sued the government for denying it access to the part of convenience fee channeled through M-Pesa Paybill 206206 arguing that the move was illegal. Without a clear indication of services Goldrock Capital offered, the people behind the company used the case to initiate the take-over from eCitizen.
Strategically, Treasury’s lawyers lodged a weak defence enabling Goldrock Capital to stay ahead of the game and forced the court to ignorantly call for arbitration without clearly understanding that Goldrock Capital had no claim since it offered no service and the government never had any contract with it in the first place.
Meanwhile, Value Chain factory is ramping up operations. Already it has poached the entire workforce of Webmasters Kenya, incapacitating it and leading to the halt of operations. The poached staff also includes three leading software developers (Larry Weya, Larry Agoro, and Thomas Juma) and the Lead Designer (Derrick Ogare).
The senior developers left Webmasters after it became clear to them that Value Chain was giving them better offers while Webmasters was not growing from it’s previous state and offering the skilled techies better prospects. While most were being paid a minimum of Ksh 300,000 per month and senior developers up to Ksh 600,000, there were no opportunities for growth and the main man behind Webmasters, James Ayugi was running it like a kiosk still while the company was handling over Ksh 15 billion annually in turnover.
Webmasters is currently handing over operations to Value Chain factory which has been awarded the contract to manage and support the platform forcing Webmasters to sack over 50 employees.
Key problem is that there were no agreements between Webmasters and Treasury on how the convenience fee was to be handled. The company has insisted on demanding that they be paid the full amount collected. Eventually, they might be paid but only after oiling the palms of well connected individuals at the Treasury.
The second contention between Treasury and Webmasters is that they were contracted to develop solutions to digitise 10 service. Webmasters automated a total of 210 services. Each of the services was to cost Ksh 1.3million in development fee. The company is demanding the same for each of the other automated services already developed and running on the platform.
eCitizen system was developed on the Elixir platform. It was initially hosted on Amazon’s AWS but since the start of transfer of management to Treasury and eventually to Value Chain, the hosting was transferred to Safaricom Business. At Amazon, government was paying a minimum of Ksh 500,000 per month as hosting fees. The amount might be higher and there might be increased downtime with Safaricom hosting.
Webmasters deployed similar systems in Lesotho, Namibia, Iraq, Morocco and Uganda.
The company is now encouraging respective government agencies and departments to host their services so as to reduce on costs.
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