“Public health is a powerful tool to level that playing field, to bend the arc of our country away from distrust and disparities and back towards equity and justice.” — Leana S. Wen
INTRODUCTION
1. The Amended Petition dated 16 th December 2024 revolves around constitutional and statutory controversies touching on one of the most basic human concerns, healthcare. Within it, the Petitioners, Respondents, and the Interested Parties have all articulated positions that weave a complex tapestry involving the right to healthcare, public procurement law, the integrity of the legislative process, and the stewardship of public finances, and many more.
2. The Petitioners, describing themselves as public-spirited citizens and human rights defenders, have approached this Court to impugn two closely related governmental undertakings. The first concerns the procurement process culminating in the award of Tender No. MOH/SDMS/ADM/SPPP/005/2023–2024 by the Ministry of Health to the consortium of the Safaricom PLC (6 th Respondent), Konvergenz Network Solutions Limited ( 7 th Respondent), and Apiero Limited ( 8 th Respondent), collectively the ‘Safaricom Consortium’ for the establishment and operation of an Integrated Healthcare Information Technology System (IHITS) intended to support the implementation of Universal Health Care (UHC) through the Social Health Insurance Fund (SHIF).
3. The Petitioners’ second concern is an extension of the first, and it relates to the legal and constitutional propriety of the rollout and operationalization of the Social Health Insurance Fund (SHIF) under the Social Health Insurance Act, No. 16 of 2023.
4. The genesis of this dispute lies in the Fifth Administration’s ambitious healthcare reforms aimed at achieving Universal Health Coverage, a key pillar of the Bottom-Up Economic Transformation Agenda (BETA). Since the dawn of the Republic, each National Administration has struggled with the veritable gordian knot that is the challenge of providing nationwide, accessible, high-quality public healthcare in a sustainable manner that also factors in our nation’s rising population and dynamic health concerns.
5. Various attempts have been made towards this end, with the relative success or failures of each being a matter for discussion by analysts and not the Bench. It is safe to say, however, that centrality of public healthcare has been a consistent theme of each Administration’s plans.
6. The First Administration situated the newly independent Kenya as facing three conjoined evils; poverty, ignorance, and disease. In that regard, President Jomo Kenyatta’s Administration established the National Hospital Insurance Fund (NHIF) in the year 1966/67 as a department within the Ministry of Health.
7. The Second Administration took the baton from the First, and drove a sustained expansion in the number of health facilities across Kenya. Of concern to this Petition was President Daniel Toroitich arap Moi’s Administration transformation of NHIF from a department into a fully-fledged state corporation which was achieved through the enactment of the National Hospital Insurance Fund Act (Chapter 255, as it then was, of the Laws of Kenya) in the year 1998.
8. In the Third Administration, President Mwai Kibaki’s seminal ‘Kenya Vision 2030’ contained a Social Pillar which emphasized health as a critical sector for improving the lives of all Kenyans. In particular, the Third Administration sought to modernize infrastructure and equipment within public hospitals, all against a backdrop of expanding the ambit and benefits of NHIF.
9. The Fourth Administration took the Kenya Vision 2030 platform and developed various policies to drive public healthcare to new levels. In addition to celebrated public health initiatives such as ‘Linda Mama’, President Uhuru Kenyatta’s Administration developed the Kenya Health Policy 2014 - 2030 and the Universal Health Coverage Health Policy 2020 - 2030 as implementation of the Social Pillar of the Kenya Vision 2030. The Fourth Administration’s Universal Healthcare, was a second term policy articulation within the President Uhuru Kenyatta’s ‘ Big Four Agenda’ , where it was one of the four pillars. Key to the present Petition was the policy view of the Fourth Administration that NHIF as it existed at the time was not fit-for-purpose and did not resonate well with the needs of a rapidly growing Kenyan population.
10. The Fifth Administration sought to make an array of changes to both the legislative as well as the operational landscape that governed public health in Kenya. Central to these reforms was the transition from the National Hospital Insurance Fund (NHIF) to a new legal framework comprising three principal statutes: the Primary Health Care Act, No. 13 of 2023; the Digital Health Act, No. 15 of 2023 and the Social Health Insurance Act, No. 16 of 2023.
11. In his second State of the Nation Address, President William Ruto identified household medical expenses as a significant challenge to Kenyans across the socio-economic landscape, and the Head of State and Government averred that his Administration’s reform package would ensure that all persons in Kenya would have access to quality and affordable healthcare through the implementation of Universal Health Coverage.
12. The implementation of this new framework, particularly the operationalization of SHIF from 1 st October 2024 and the procurement of the technological backbone for the entire system (the IHITS); form the primary subject matters of these proceedings.
13. The Petition has traversed a rather protracted procedural trajectory. It was initially lodged on 30 th September 2024 together with a Notice of Motion seeking interim conservatory relief. In response to the initial Petition, the Respondents and Interested Parties placed before the Court a multiplicity of pleadings, replying affidavits, grounds of opposition, and preliminary objections.
14. Further, the 8 th Interested Party, the Kenya Airline Pilots Association (KALPA), as well as a proposed co-Petitioner, Jackline Ruguru Kagu, sought leave to be enjoined in the matter. The former was joined, while the latter was not.
15. The Petitioners subsequently sought and were consequently granted leave to amend their pleadings, culminating in the filing of the Amended Petition dated 16 th December 2024 which now constitutes the petition pending determination herein.
16. The interlocutory applications seeking conservatory orders were resolved, thereby clearing the way for the substantive adjudication of the Amended Petition
17. Following the close of pleadings, the Court issued directions on the filing and exchange of written submissions, which were duly filed and served, and thereafter comprehensively canvassed by all parties vide a hearing by way of highlighting of written submissions.
18. Having undertaken a comprehensive appraisal of the Amended Petition, the responses and affidavits filed by each Respondent and Interested Party, the extensive written submissions, the numerous authorities cited, and the voluminous documentary evidence annexed thereto, this Court now renders its judgment. The Court's analysis is guided by the principles of constitutional interpretation set out in Article 259, which mandates a purposive interpretation that promotes the Constitution's purposes, values, and principles, advances the rule of law, human rights, and fundamental freedoms, and contributes to good governance.
19. To place the grievances raised in their proper context, it is necessary to outline the factual matrix emerging from the pleadings and the documentary record placed before the Court. In October 2023, Parliament enacted three significant statutes intended to reform the health sector, namely the Primary Health Care Act, No. 13 of 2023, the Digital Health Act, No. 15 of 2023, and the Social Health Insurance Act, No. 16 of 2023. The latter statute, which came into force on 22 nd November 2023, repealed the National Health Insurance Fund Act and established the Social Health Authority as the body charged with administering the new statutory framework.
20. The Social Health Insurance Act further created three distinct funds to facilitate the realization of universal health coverage, namely the Primary Healthcare Fund under section 20, the Social Health Insurance Fund under section 25, and the Emergency, Chronic and Critical Illness Fund under section 28.
21. In parallel with these legislative developments, the Government, through the Ministry of Health’s State Department for Medical Services, initiated steps towards the digitization of the health sector through the establishment of a digital infrastructure intended to support the implementation of Universal Health Care (UHC). This initiative envisaged the procurement of an Integrated Healthcare Information Technology System (IHITS) to function as a national digital backbone for healthcare services.
22. The procuring entity was the State Department for Medical Services within the Ministry of Health, with the Principal Secretary serving as the accounting officer. The procurement was undertaken pursuant to the Specially Permitted Procurement Procedure (SPPP) provided for under section 114A(2)(d) of the Public Procurement and Asset Disposal Act, 2015, a mechanism that allows the Government, in appropriate circumstances, to source strategic partnerships for projects deemed to be of national importance.
23. The procurement process was set in motion by a letter dated 6 th June 2023 from the Ministry of Health to the National Treasury seeking approval to adopt the Specially Permitted Procurement Procedure for several projects, including the proposed healthcare information technology digitization initiative. By a communication dated 27 th June 2023, the National Treasury granted the requisite approval, subject to a number of conditions, among them the preparation of appropriate tender documentation. Thereafter, on 9 th May 2024, the procuring entity issued a Request for Proposal (RFP) to Safaricom PLC, inviting it to submit a bid either in its individual capacity or as part of a consortium. The RFP specified that the procurement would proceed under the Specially Permitted Procurement Procedure through a Single Source Selection method.
24. On 15 th May 2024, a consortium led by Safaricom PLC and also comprising Konvergenz Network Solutions Limited and Apeiro Limited submitted both technical and financial proposals in response to the Request for Proposal. The consortium’s financial bid quoted a contract sum of Kshs. 104,808,136,478.00. A Notification of Intention to Award was issued on 16 th May 2024. Following subsequent negotiations between the parties, a formal Notification of Award was issued on 19 th June 2024.
25. The Safaricom Consortium, however, raised concerns regarding discrepancies in that notification, particularly in relation to the stated contract duration and the addressee of the award. These concerns prompted the issuance of a Revised Notification of Award on 2 nd July 2024, which corrected the contract period to ten (10) years and properly addressed the award to the Safaricom Consortium.
26. In the intervening period, the Office of the Attorney General granted clearance for the contract on 27 th June 2024. The consortium formally accepted the award on 2 nd August 2024 and on 9 th August 2024 the parties executed an agreement for the provision of Healthcare Information Technology Digitization for Universal Health Care (UHC) at a contract price of Kshs. 104,808,136,478.00 over a ten-year period.
27. Subsequently, on 1 st October 2024 the Social Health Insurance Fund (SHIF) established under the Social Health Insurance Act, No. 16 of 2023 was rolled-out by the Government in place of the National Hospital Insurance Fund (NHIF). The implementation of the new Fund was supported by a series of subsidiary legislative instruments, including the Social Health Insurance (General) Regulations, 2024 (Legal Notice No. 49 of 2024), the Social Health Insurance (Tribunal Procedure) Rules, 2024 (Legal Notice No. 48 of 2024), and later the Tariffs for Healthcare Services Regulations (Legal Notice No. 146 of 2024) together with the Social Health Insurance (Amendment) Regulations, 2024 (Legal Notice No. 147 of 2024).
28. It is against this legislative and administrative backdrop that the Petitioners instituted the present proceedings on 30 th September 2024. They are challenging the legality and constitutionality of the procurement process and the statutory framework underpinning the roll-out of the Social Health Insurance Fund.
THE PETITIONERS' CASE
29. The Petitioners’ case, as articulated in the Amended Petition dated 16 th December 2024, the supporting affidavits, and the written submissions filed on their behalf, is multifaceted. In essence, they contend that both the procurement of the Integrated Healthcare Information Technology System (IHITS) and the subsequent rollout of the Social Health Insurance Fund (SHIF) were undertaken in a manner that is unlawful, unconstitutional, and inimical to the public interest.
30. The Petitioners contend that the procurement of the Integrated Healthcare Information Technology System (IHITS) was vitiated by alleged illegality, impropriety, and fraud. In their view, the impugned process was undertaken in a manner that circumvented the constitutional imperatives of transparency, accountability, public participation, and fair competition that govern public procurement. They particularly assail the constitutionality of Section 114A of the Public Procurement and Asset Disposal Act, 2015 (PPADA), which establishes the Specially Permitted Procurement Procedure (SPPP), contending that the provision was irregularly introduced into the statute and is, in any event, inconsistent with Article 227 of the Constitution.
31. The Petitioners contend that the said provision is unconstitutional, null, and void on several grounds. First, they argue that Section 114A was irregularly introduced into the statute through Section 57 of the Finance Act, No. 15 of 2017. In their view, a Finance Act, being the legislative product of a Money Bill, is constitutionally limited to matters relating to taxation, revenue-raising measures, and matters incidental thereto. It therefore cannot lawfully be used as a vehicle to amend substantive legislation governing public procurement.
32. Secondly, the Petitioners contend that the enactment of Section 114A contravened the constitutional framework governing bicameral legislation. Relying on Articles 96(2) and 110 of the Constitution, they submit that the Public Procurement and Asset Disposal Act applies to both national and county governments in their procurement activities. Consequently, any legislative amendment thereto constitutes legislation concerning county governments and therefore required the participation and concurrence of the Senate. The failure to involve the Senate in the enactment of Section 114A, it is argued, renders the provision constitutionally defective.
33. Thirdly, the Petitioners assert that the Specially Permitted Procurement Procedure is, by its very design, incompatible with the constitutional principles governing public procurement. They argue that the procedure undermines Article 227(1) of the Constitution, which requires public procurement systems to be fair, equitable, transparent, competitive, and cost-effective. According to the Petitioners, the SPPP vests wide and largely unchecked discretion in the Cabinet Secretary for the National Treasury and the accounting officer of the procuring entity, thereby enabling them to bypass the competitive safeguards envisioned by the Constitution.
34. The Petitioners further challenge the legal architecture underpinning the Social Health Insurance Fund (SHIF), asserting that the subsidiary legislation purporting to operationalize the Fund was not lawfully enacted in accordance with the Constitution and the applicable statutory framework. They additionally contend that the three funds established under the Social Health Insurance Act are incompatible with the constitutional design governing the management, control, and oversight of public finances.
35. Flowing from their challenge to the constitutionality of the enabling provision, the Petitioners further contend that, even assuming the validity of Section 114A (which the strenuously deny), the procurement of the IHITS did not satisfy the statutory conditions for invoking the Specially Permitted Procurement Procedure. In particular, they refer to Section 114A(2)(a), which limits the use of the procedure to circumstances where exceptional requirements render compliance with the ordinary procurement framework impossible, impracticable, or uneconomical.
36. The Petitioners maintain that no such exceptional circumstances existed in the present case. They argue that the development and deployment of an enterprise resource planning digital system is neither novel nor uniquely complex and that similar health information management systems have previously been procured competitively by various county governments and by the former National Health Insurance Fund at significantly lower costs.
37. The Petitioners also challenge the identity of the procuring entity and the legal propriety of the procurement process undertaken. They contend that the statutory mandate to develop and manage the national integrated health information system lies with the Digital Health Agency established under the Digital Health Act, No. 15 of 2023. In particular, they rely on section 6(a) of the Act, which assigns to the Agency the responsibility of developing, operationalizing, and maintaining the Comprehensive Integrated Health Information System. By undertaking the procurement through the Ministry of Health rather than through the Digital Health Agency, the Petitioners argue that the Respondents acted in disregard of the express provisions of the statute and the constitutional principle of the rule of law embodied in Article 10 of the Constitution.
38. The Petitioners further mount a sustained challenge to the composition and capacity of the consortium awarded the tender, namely the consortium led by Safaricom PLC and comprising Konvergenz Network Solutions Limited and Apeiro Limited. In their view, none of the entities meets the statutory threshold of a “strategic partner” contemplated under Section 114A(2)(d) of the procurement statute. They draw particular attention to the incorporation of Apeiro Limited on 10 th July 2023, barely months before the Request for Proposal was issued, arguing that such a recently incorporated entity could not possibly have satisfied the tender requirements relating to audited financial statements and tax compliance. The Petitioners further characterize the company as a shell entity lacking independent financial capacity and relying instead on a letter of comfort from its parent company while subcontracting substantial portions of its responsibilities to foreign entities.
39. According to the Petitioners, this arrangement raises grave concerns regarding the security and control of Kenya’s health data, which they assert is recognized under the Digital Health Act, No. 15 of 2023 as a strategic national asset. They contend that the outsourcing of key components of the system to foreign companies domiciled in jurisdictions such as the United Arab Emirates, India, and the United States exposes sensitive national health data to unregulated and potentially insecure handling.
40. The Petitioners similarly question the technical and financial capacity of Konvergenz Network Solutions Limited. They point to the company’s declaration in its Confidential Business Questionnaire indicating that the maximum value of business it could undertake was Kshs. 250 million, yet it was allocated a component of the impugned contract valued at approximately Kshs. 25 billion. They also question the role of Safaricom PLC within the consortium, contending that the company’s primary expertise lies in telecommunications services rather than software development and enterprise system architecture.
41. The Petitioners further allege that the procurement process was marred by serious procedural irregularities. In particular, they assert that two separate procurement processes were conducted under the same tender number. According to their account, the initial procurement culminated in negotiations that reduced Safaricom PLC’s original bid of Kshs. 111,009,326,363.00 to a negotiated contract price of Kshs. 48,367,839,050.00 as at 24 th January 2024. However, when Safaricom allegedly declined to execute the resultant contract, the Petitioners contend that the applicable procurement rules required the forfeiture of the tender security and the bidder’s debarment from future procurement proceedings.
42. Instead, the Petitioners allege that the procuring entity initiated a second procurement process by issuing a fresh Request for Proposal on 9 th May 2024, which ultimately culminated in the award of a new contract valued at Kshs. 104,808,136,478.00 an amount they state is approximately Kshs. 56 billion higher than the earlier negotiated figure and arrived at without further negotiations. In their view, this sequence of events reveals a deliberate scheme designed to inflate the contract price to the detriment of the public purse.
43. The Petitioners also fault the procurement process for failing to secure tender security as required under Section 61 of the Public Procurement and Asset Disposal Act, 2015. They argue that the Request for Proposal expressly required the provision of tender security and that the statutory exemptions do not apply to the consortium. As a result, the public allegedly remained exposed when the bidder declined to sign the initial contract.
44. According to the Petitioners, the impugned procurement process was orchestrated in a manner calculated to defraud Kenyan taxpayers and the contributors to the Social Health Insurance Fund of a colossal sum of money, estimated at Kshs. 104,808,136,478.00 being the contract sum.
45. Beyond the procurement dispute, the Petitioners also challenge the legal framework underpinning the rollout of the Social Health Insurance Fund established under the Social Health Insurance Act, No. 16 of 2023. They contend that the subsidiary legislation intended to operationalize the Fund was invalid. In particular, they argue that the Social Health Insurance (General) Regulations, 2024 and the Social Health Insurance (Tribunal Procedure) Rules, 2024 were annulled by the Senate on 30 th July 2024. Consequently, they assert that subsequent instruments including the Tariffs for Healthcare Services Regulations and the Social Health Insurance (Amendment) Regulations, 2024 lack a valid legal foundation.
46. The Petitioners further contend that the impugned subsidiary legislation was enacted without adequate public participation, contrary to Articles 10 and 118 of the Constitution and Section 5 of the Statutory Instruments Act. They also challenge the tariff framework introduced by the regulations, arguing that its uniform and blanket structure fails to take into account the needs and protections of vulnerable and marginalized groups.
47. Additionally, the Petitioners contest the constitutionality of Sections 20, 25, and 28 of the Social Health Insurance Act, which establish the Primary Healthcare Fund, the Social Health Insurance Fund, and the Emergency, Chronic and Critical Illness Fund respectively. They contend that the creation of these funds is inconsistent with Article 206 of the Constitution and the statutory framework governing public finance management, as it effectively establishes sub-consolidated funds outside the constitutionally prescribed procedures.
48. The Petitioners also question the constitutionality of Sections 15(2) and 23(1) of the Statutory Instruments Act to the extent that they permit statutory instruments to come into operation prior to parliamentary scrutiny and approval. In their view, this arrangement undermines Parliament’s legislative authority under Article 94(5) of the Constitution.
49. In their written submissions, the Petitioners reiterate the foregoing arguments and emphasize the alleged violation of the constitutional right to health guaranteed under Article 43 of the Constitution. They further invoke the public interest in safeguarding public resources and ensuring constitutional fidelity in the management of national health programmes. In support of their position, they rely on several authorities, including Gatirau Peter Munya v Dickson Mwenda Kithinji & 2 others and Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others , among other decisions cited in their submissions.
50. On the basis of these arguments, the Petitioners urge the Court to grant the reliefs sought in the Amended Petition and to issue such further orders as may be necessary to vindicate and protect the constitutional rights and principles alleged to have been violated.
THE RESPONDENTS' CASES
The 1 st and 2 nd Respondents' Case
51. The Respondents, comprising the State organs responsible for health and public finance, the procuring entities, and the private entities constituting the Safaricom Consortium, vigorously defend both the impugned procurement process and the legislative frameworks under challenge.
52. They maintain that the procurement leading to the award of the IHITS tender was conducted in accordance with the law and within the parameters of the Public Procurement and Asset Disposal Act.
53. The Respondents further underscore the compelling public interest in the effective and timely realization of Universal Health Care, contending that the Petition, whether by reason of prematurity, procedural impropriety, or want of factual foundation, is not properly before this Court and ought not to impede the implementation of a programme of such critical national importance.
54. The 1 st and 2 nd Respondents, namely the Cabinet Secretary for Health and the Principal Secretary in the State Department for Medical Services, oppose the Petition through an extensive Replying Affidavit sworn by Harry K. Kimtai, the Principal Secretary, together with detailed written submissions filed on their behalf. In essence, they mount a robust defence of the impugned procurement process and the legal framework under challenge.
55. The 1 st and 2 nd Respondents contend that the dispute presented before the Court is, in substance, a procurement and tendering dispute rather than a constitutional controversy. Consequently, they argue that this Court ought not to assume jurisdiction in the first instance. In this regard, they invoke the doctrines of constitutional avoidance and exhaustion of statutory remedies, relying inter alia on the decision of the Supreme Court in Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others.
56. On the merits of the dispute, the 1 st and 2 nd Respondents provide a detailed account of the procurement process, maintaining that the entire process was conducted in strict conformity with the law. They justify the adoption of the Specially Permitted Procurement Procedure (SPPP) under Section 114A(2)(d) of the Public Procurement and Asset Disposal Act, 2015 on the basis that the Integrated Healthcare Information Technology System (IHITS) project required a strategic partner capable of financing the substantial upfront costs associated with the establishment of a nationwide digital health infrastructure.
57. According to the 1 st and 2 nd Respondents, the magnitude and complexity of the project rendered conventional procurement methods impracticable and uneconomical. They further trace the conceptual origins of the project to the Government’s policy initiatives under the BETA agenda and the national development blueprint contained in Kenya Vision 2030, as well as several policy and technical reports, including the Kenya Digital Health Landscape Assessment Report, 2023, which recommended partnering with an entity possessing extensive nationwide technological infrastructure.
58. With regard to the identity of the procuring entity, the 1 st and 2 nd Respondents contend that the Ministry of Health, through the State Department for Medical Services, was the legally mandated body to undertake the procurement. They rely on Presidential Executive Order No. 2 of 2023 on ‘the Organization of the Government of the Republic of Kenya’, which assigned responsibility for “ E-Health” functions to the State Department for Medical Services.
59. They further invoke Section 105(3) of the Health Act, 2017, which empowers the Ministry of Health to facilitate the establishment and maintenance of a comprehensive integrated health information system. The 1 st and 2 nd Respondents also submit that at the time the procurement process was initiated in June 2023, the Digital Health Agency had not yet been established; since the Digital Health Act [ Act No. 15 of 2023] only came into force on 19 th October 2023 and its full operationalization was anticipated to take considerable time. They add that the impugned contract itself expressly contemplates the role of the Digital Health Agency and is intended to equip the Agency, together with other health institutions, with the requisite digital infrastructure.
60. The 1 st and 2 nd Respondents also address the Petitioners’ concerns relating to intellectual property rights arising from the contract. They explain that the contractual arrangement adopts a Software-as-a-Service (SaaS) model, which they describe as a widely accepted and cost-efficient approach to large-scale digital infrastructure projects. Unde
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INTRODUCTION
1. The Amended Petition dated 16 th December 2024 revolves around constitutional and statutory controversies touching on one of the most basic human concerns, healthcare. Within it, the Petitioners, Respondents, and the Interested Parties have all articulated positions that weave a complex tapestry involving the right to healthcare, public procurement law, the integrity of the legislative process, and the stewardship of public finances, and many more.
2. The Petitioners, describing themselves as public-spirited citizens and human rights defenders, have approached this Court to impugn two closely related governmental undertakings. The first concerns the procurement process culminating in the award of Tender No. MOH/SDMS/ADM/SPPP/005/2023–2024 by the Ministry of Health to the consortium of the Safaricom PLC (6 th Respondent), Konvergenz Network Solutions Limited ( 7 th Respondent), and Apiero Limited ( 8 th Respondent), collectively the ‘Safaricom Consortium’ for the establishment and operation of an Integrated Healthcare Information Technology System (IHITS) intended to support the implementation of Universal Health Care (UHC) through the Social Health Insurance Fund (SHIF).
3. The Petitioners’ second concern is an extension of the first, and it relates to the legal and constitutional propriety of the rollout and operationalization of the Social Health Insurance Fund (SHIF) under the Social Health Insurance Act, No. 16 of 2023.
4. The genesis of this dispute lies in the Fifth Administration’s ambitious healthcare reforms aimed at achieving Universal Health Coverage, a key pillar of the Bottom-Up Economic Transformation Agenda (BETA). Since the dawn of the Republic, each National Administration has struggled with the veritable gordian knot that is the challenge of providing nationwide, accessible, high-quality public healthcare in a sustainable manner that also factors in our nation’s rising population and dynamic health concerns.
5. Various attempts have been made towards this end, with the relative success or failures of each being a matter for discussion by analysts and not the Bench. It is safe to say, however, that centrality of public healthcare has been a consistent theme of each Administration’s plans.
6. The First Administration situated the newly independent Kenya as facing three conjoined evils; poverty, ignorance, and disease. In that regard, President Jomo Kenyatta’s Administration established the National Hospital Insurance Fund (NHIF) in the year 1966/67 as a department within the Ministry of Health.
7. The Second Administration took the baton from the First, and drove a sustained expansion in the number of health facilities across Kenya. Of concern to this Petition was President Daniel Toroitich arap Moi’s Administration transformation of NHIF from a department into a fully-fledged state corporation which was achieved through the enactment of the National Hospital Insurance Fund Act (Chapter 255, as it then was, of the Laws of Kenya) in the year 1998.
8. In the Third Administration, President Mwai Kibaki’s seminal ‘Kenya Vision 2030’ contained a Social Pillar which emphasized health as a critical sector for improving the lives of all Kenyans. In particular, the Third Administration sought to modernize infrastructure and equipment within public hospitals, all against a backdrop of expanding the ambit and benefits of NHIF.
9. The Fourth Administration took the Kenya Vision 2030 platform and developed various policies to drive public healthcare to new levels. In addition to celebrated public health initiatives such as ‘Linda Mama’, President Uhuru Kenyatta’s Administration developed the Kenya Health Policy 2014 - 2030 and the Universal Health Coverage Health Policy 2020 - 2030 as implementation of the Social Pillar of the Kenya Vision 2030. The Fourth Administration’s Universal Healthcare, was a second term policy articulation within the President Uhuru Kenyatta’s ‘ Big Four Agenda’ , where it was one of the four pillars. Key to the present Petition was the policy view of the Fourth Administration that NHIF as it existed at the time was not fit-for-purpose and did not resonate well with the needs of a rapidly growing Kenyan population.
10. The Fifth Administration sought to make an array of changes to both the legislative as well as the operational landscape that governed public health in Kenya. Central to these reforms was the transition from the National Hospital Insurance Fund (NHIF) to a new legal framework comprising three principal statutes: the Primary Health Care Act, No. 13 of 2023; the Digital Health Act, No. 15 of 2023 and the Social Health Insurance Act, No. 16 of 2023.
11. In his second State of the Nation Address, President William Ruto identified household medical expenses as a significant challenge to Kenyans across the socio-economic landscape, and the Head of State and Government averred that his Administration’s reform package would ensure that all persons in Kenya would have access to quality and affordable healthcare through the implementation of Universal Health Coverage.
12. The implementation of this new framework, particularly the operationalization of SHIF from 1 st October 2024 and the procurement of the technological backbone for the entire system (the IHITS); form the primary subject matters of these proceedings.
13. The Petition has traversed a rather protracted procedural trajectory. It was initially lodged on 30 th September 2024 together with a Notice of Motion seeking interim conservatory relief. In response to the initial Petition, the Respondents and Interested Parties placed before the Court a multiplicity of pleadings, replying affidavits, grounds of opposition, and preliminary objections.
14. Further, the 8 th Interested Party, the Kenya Airline Pilots Association (KALPA), as well as a proposed co-Petitioner, Jackline Ruguru Kagu, sought leave to be enjoined in the matter. The former was joined, while the latter was not.
15. The Petitioners subsequently sought and were consequently granted leave to amend their pleadings, culminating in the filing of the Amended Petition dated 16 th December 2024 which now constitutes the petition pending determination herein.
16. The interlocutory applications seeking conservatory orders were resolved, thereby clearing the way for the substantive adjudication of the Amended Petition
17. Following the close of pleadings, the Court issued directions on the filing and exchange of written submissions, which were duly filed and served, and thereafter comprehensively canvassed by all parties vide a hearing by way of highlighting of written submissions.
18. Having undertaken a comprehensive appraisal of the Amended Petition, the responses and affidavits filed by each Respondent and Interested Party, the extensive written submissions, the numerous authorities cited, and the voluminous documentary evidence annexed thereto, this Court now renders its judgment. The Court's analysis is guided by the principles of constitutional interpretation set out in Article 259, which mandates a purposive interpretation that promotes the Constitution's purposes, values, and principles, advances the rule of law, human rights, and fundamental freedoms, and contributes to good governance.
19. To place the grievances raised in their proper context, it is necessary to outline the factual matrix emerging from the pleadings and the documentary record placed before the Court. In October 2023, Parliament enacted three significant statutes intended to reform the health sector, namely the Primary Health Care Act, No. 13 of 2023, the Digital Health Act, No. 15 of 2023, and the Social Health Insurance Act, No. 16 of 2023. The latter statute, which came into force on 22 nd November 2023, repealed the National Health Insurance Fund Act and established the Social Health Authority as the body charged with administering the new statutory framework.
20. The Social Health Insurance Act further created three distinct funds to facilitate the realization of universal health coverage, namely the Primary Healthcare Fund under section 20, the Social Health Insurance Fund under section 25, and the Emergency, Chronic and Critical Illness Fund under section 28.
21. In parallel with these legislative developments, the Government, through the Ministry of Health’s State Department for Medical Services, initiated steps towards the digitization of the health sector through the establishment of a digital infrastructure intended to support the implementation of Universal Health Care (UHC). This initiative envisaged the procurement of an Integrated Healthcare Information Technology System (IHITS) to function as a national digital backbone for healthcare services.
22. The procuring entity was the State Department for Medical Services within the Ministry of Health, with the Principal Secretary serving as the accounting officer. The procurement was undertaken pursuant to the Specially Permitted Procurement Procedure (SPPP) provided for under section 114A(2)(d) of the Public Procurement and Asset Disposal Act, 2015, a mechanism that allows the Government, in appropriate circumstances, to source strategic partnerships for projects deemed to be of national importance.
23. The procurement process was set in motion by a letter dated 6 th June 2023 from the Ministry of Health to the National Treasury seeking approval to adopt the Specially Permitted Procurement Procedure for several projects, including the proposed healthcare information technology digitization initiative. By a communication dated 27 th June 2023, the National Treasury granted the requisite approval, subject to a number of conditions, among them the preparation of appropriate tender documentation. Thereafter, on 9 th May 2024, the procuring entity issued a Request for Proposal (RFP) to Safaricom PLC, inviting it to submit a bid either in its individual capacity or as part of a consortium. The RFP specified that the procurement would proceed under the Specially Permitted Procurement Procedure through a Single Source Selection method.
24. On 15 th May 2024, a consortium led by Safaricom PLC and also comprising Konvergenz Network Solutions Limited and Apeiro Limited submitted both technical and financial proposals in response to the Request for Proposal. The consortium’s financial bid quoted a contract sum of Kshs. 104,808,136,478.00. A Notification of Intention to Award was issued on 16 th May 2024. Following subsequent negotiations between the parties, a formal Notification of Award was issued on 19 th June 2024.
25. The Safaricom Consortium, however, raised concerns regarding discrepancies in that notification, particularly in relation to the stated contract duration and the addressee of the award. These concerns prompted the issuance of a Revised Notification of Award on 2 nd July 2024, which corrected the contract period to ten (10) years and properly addressed the award to the Safaricom Consortium.
26. In the intervening period, the Office of the Attorney General granted clearance for the contract on 27 th June 2024. The consortium formally accepted the award on 2 nd August 2024 and on 9 th August 2024 the parties executed an agreement for the provision of Healthcare Information Technology Digitization for Universal Health Care (UHC) at a contract price of Kshs. 104,808,136,478.00 over a ten-year period.
27. Subsequently, on 1 st October 2024 the Social Health Insurance Fund (SHIF) established under the Social Health Insurance Act, No. 16 of 2023 was rolled-out by the Government in place of the National Hospital Insurance Fund (NHIF). The implementation of the new Fund was supported by a series of subsidiary legislative instruments, including the Social Health Insurance (General) Regulations, 2024 (Legal Notice No. 49 of 2024), the Social Health Insurance (Tribunal Procedure) Rules, 2024 (Legal Notice No. 48 of 2024), and later the Tariffs for Healthcare Services Regulations (Legal Notice No. 146 of 2024) together with the Social Health Insurance (Amendment) Regulations, 2024 (Legal Notice No. 147 of 2024).
28. It is against this legislative and administrative backdrop that the Petitioners instituted the present proceedings on 30 th September 2024. They are challenging the legality and constitutionality of the procurement process and the statutory framework underpinning the roll-out of the Social Health Insurance Fund.
THE PETITIONERS' CASE
29. The Petitioners’ case, as articulated in the Amended Petition dated 16 th December 2024, the supporting affidavits, and the written submissions filed on their behalf, is multifaceted. In essence, they contend that both the procurement of the Integrated Healthcare Information Technology System (IHITS) and the subsequent rollout of the Social Health Insurance Fund (SHIF) were undertaken in a manner that is unlawful, unconstitutional, and inimical to the public interest.
30. The Petitioners contend that the procurement of the Integrated Healthcare Information Technology System (IHITS) was vitiated by alleged illegality, impropriety, and fraud. In their view, the impugned process was undertaken in a manner that circumvented the constitutional imperatives of transparency, accountability, public participation, and fair competition that govern public procurement. They particularly assail the constitutionality of Section 114A of the Public Procurement and Asset Disposal Act, 2015 (PPADA), which establishes the Specially Permitted Procurement Procedure (SPPP), contending that the provision was irregularly introduced into the statute and is, in any event, inconsistent with Article 227 of the Constitution.
31. The Petitioners contend that the said provision is unconstitutional, null, and void on several grounds. First, they argue that Section 114A was irregularly introduced into the statute through Section 57 of the Finance Act, No. 15 of 2017. In their view, a Finance Act, being the legislative product of a Money Bill, is constitutionally limited to matters relating to taxation, revenue-raising measures, and matters incidental thereto. It therefore cannot lawfully be used as a vehicle to amend substantive legislation governing public procurement.
32. Secondly, the Petitioners contend that the enactment of Section 114A contravened the constitutional framework governing bicameral legislation. Relying on Articles 96(2) and 110 of the Constitution, they submit that the Public Procurement and Asset Disposal Act applies to both national and county governments in their procurement activities. Consequently, any legislative amendment thereto constitutes legislation concerning county governments and therefore required the participation and concurrence of the Senate. The failure to involve the Senate in the enactment of Section 114A, it is argued, renders the provision constitutionally defective.
33. Thirdly, the Petitioners assert that the Specially Permitted Procurement Procedure is, by its very design, incompatible with the constitutional principles governing public procurement. They argue that the procedure undermines Article 227(1) of the Constitution, which requires public procurement systems to be fair, equitable, transparent, competitive, and cost-effective. According to the Petitioners, the SPPP vests wide and largely unchecked discretion in the Cabinet Secretary for the National Treasury and the accounting officer of the procuring entity, thereby enabling them to bypass the competitive safeguards envisioned by the Constitution.
34. The Petitioners further challenge the legal architecture underpinning the Social Health Insurance Fund (SHIF), asserting that the subsidiary legislation purporting to operationalize the Fund was not lawfully enacted in accordance with the Constitution and the applicable statutory framework. They additionally contend that the three funds established under the Social Health Insurance Act are incompatible with the constitutional design governing the management, control, and oversight of public finances.
35. Flowing from their challenge to the constitutionality of the enabling provision, the Petitioners further contend that, even assuming the validity of Section 114A (which the strenuously deny), the procurement of the IHITS did not satisfy the statutory conditions for invoking the Specially Permitted Procurement Procedure. In particular, they refer to Section 114A(2)(a), which limits the use of the procedure to circumstances where exceptional requirements render compliance with the ordinary procurement framework impossible, impracticable, or uneconomical.
36. The Petitioners maintain that no such exceptional circumstances existed in the present case. They argue that the development and deployment of an enterprise resource planning digital system is neither novel nor uniquely complex and that similar health information management systems have previously been procured competitively by various county governments and by the former National Health Insurance Fund at significantly lower costs.
37. The Petitioners also challenge the identity of the procuring entity and the legal propriety of the procurement process undertaken. They contend that the statutory mandate to develop and manage the national integrated health information system lies with the Digital Health Agency established under the Digital Health Act, No. 15 of 2023. In particular, they rely on section 6(a) of the Act, which assigns to the Agency the responsibility of developing, operationalizing, and maintaining the Comprehensive Integrated Health Information System. By undertaking the procurement through the Ministry of Health rather than through the Digital Health Agency, the Petitioners argue that the Respondents acted in disregard of the express provisions of the statute and the constitutional principle of the rule of law embodied in Article 10 of the Constitution.
38. The Petitioners further mount a sustained challenge to the composition and capacity of the consortium awarded the tender, namely the consortium led by Safaricom PLC and comprising Konvergenz Network Solutions Limited and Apeiro Limited. In their view, none of the entities meets the statutory threshold of a “strategic partner” contemplated under Section 114A(2)(d) of the procurement statute. They draw particular attention to the incorporation of Apeiro Limited on 10 th July 2023, barely months before the Request for Proposal was issued, arguing that such a recently incorporated entity could not possibly have satisfied the tender requirements relating to audited financial statements and tax compliance. The Petitioners further characterize the company as a shell entity lacking independent financial capacity and relying instead on a letter of comfort from its parent company while subcontracting substantial portions of its responsibilities to foreign entities.
39. According to the Petitioners, this arrangement raises grave concerns regarding the security and control of Kenya’s health data, which they assert is recognized under the Digital Health Act, No. 15 of 2023 as a strategic national asset. They contend that the outsourcing of key components of the system to foreign companies domiciled in jurisdictions such as the United Arab Emirates, India, and the United States exposes sensitive national health data to unregulated and potentially insecure handling.
40. The Petitioners similarly question the technical and financial capacity of Konvergenz Network Solutions Limited. They point to the company’s declaration in its Confidential Business Questionnaire indicating that the maximum value of business it could undertake was Kshs. 250 million, yet it was allocated a component of the impugned contract valued at approximately Kshs. 25 billion. They also question the role of Safaricom PLC within the consortium, contending that the company’s primary expertise lies in telecommunications services rather than software development and enterprise system architecture.
41. The Petitioners further allege that the procurement process was marred by serious procedural irregularities. In particular, they assert that two separate procurement processes were conducted under the same tender number. According to their account, the initial procurement culminated in negotiations that reduced Safaricom PLC’s original bid of Kshs. 111,009,326,363.00 to a negotiated contract price of Kshs. 48,367,839,050.00 as at 24 th January 2024. However, when Safaricom allegedly declined to execute the resultant contract, the Petitioners contend that the applicable procurement rules required the forfeiture of the tender security and the bidder’s debarment from future procurement proceedings.
42. Instead, the Petitioners allege that the procuring entity initiated a second procurement process by issuing a fresh Request for Proposal on 9 th May 2024, which ultimately culminated in the award of a new contract valued at Kshs. 104,808,136,478.00 an amount they state is approximately Kshs. 56 billion higher than the earlier negotiated figure and arrived at without further negotiations. In their view, this sequence of events reveals a deliberate scheme designed to inflate the contract price to the detriment of the public purse.
43. The Petitioners also fault the procurement process for failing to secure tender security as required under Section 61 of the Public Procurement and Asset Disposal Act, 2015. They argue that the Request for Proposal expressly required the provision of tender security and that the statutory exemptions do not apply to the consortium. As a result, the public allegedly remained exposed when the bidder declined to sign the initial contract.
44. According to the Petitioners, the impugned procurement process was orchestrated in a manner calculated to defraud Kenyan taxpayers and the contributors to the Social Health Insurance Fund of a colossal sum of money, estimated at Kshs. 104,808,136,478.00 being the contract sum.
45. Beyond the procurement dispute, the Petitioners also challenge the legal framework underpinning the rollout of the Social Health Insurance Fund established under the Social Health Insurance Act, No. 16 of 2023. They contend that the subsidiary legislation intended to operationalize the Fund was invalid. In particular, they argue that the Social Health Insurance (General) Regulations, 2024 and the Social Health Insurance (Tribunal Procedure) Rules, 2024 were annulled by the Senate on 30 th July 2024. Consequently, they assert that subsequent instruments including the Tariffs for Healthcare Services Regulations and the Social Health Insurance (Amendment) Regulations, 2024 lack a valid legal foundation.
46. The Petitioners further contend that the impugned subsidiary legislation was enacted without adequate public participation, contrary to Articles 10 and 118 of the Constitution and Section 5 of the Statutory Instruments Act. They also challenge the tariff framework introduced by the regulations, arguing that its uniform and blanket structure fails to take into account the needs and protections of vulnerable and marginalized groups.
47. Additionally, the Petitioners contest the constitutionality of Sections 20, 25, and 28 of the Social Health Insurance Act, which establish the Primary Healthcare Fund, the Social Health Insurance Fund, and the Emergency, Chronic and Critical Illness Fund respectively. They contend that the creation of these funds is inconsistent with Article 206 of the Constitution and the statutory framework governing public finance management, as it effectively establishes sub-consolidated funds outside the constitutionally prescribed procedures.
48. The Petitioners also question the constitutionality of Sections 15(2) and 23(1) of the Statutory Instruments Act to the extent that they permit statutory instruments to come into operation prior to parliamentary scrutiny and approval. In their view, this arrangement undermines Parliament’s legislative authority under Article 94(5) of the Constitution.
49. In their written submissions, the Petitioners reiterate the foregoing arguments and emphasize the alleged violation of the constitutional right to health guaranteed under Article 43 of the Constitution. They further invoke the public interest in safeguarding public resources and ensuring constitutional fidelity in the management of national health programmes. In support of their position, they rely on several authorities, including Gatirau Peter Munya v Dickson Mwenda Kithinji & 2 others and Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others , among other decisions cited in their submissions.
50. On the basis of these arguments, the Petitioners urge the Court to grant the reliefs sought in the Amended Petition and to issue such further orders as may be necessary to vindicate and protect the constitutional rights and principles alleged to have been violated.
THE RESPONDENTS' CASES
The 1 st and 2 nd Respondents' Case
51. The Respondents, comprising the State organs responsible for health and public finance, the procuring entities, and the private entities constituting the Safaricom Consortium, vigorously defend both the impugned procurement process and the legislative frameworks under challenge.
52. They maintain that the procurement leading to the award of the IHITS tender was conducted in accordance with the law and within the parameters of the Public Procurement and Asset Disposal Act.
53. The Respondents further underscore the compelling public interest in the effective and timely realization of Universal Health Care, contending that the Petition, whether by reason of prematurity, procedural impropriety, or want of factual foundation, is not properly before this Court and ought not to impede the implementation of a programme of such critical national importance.
54. The 1 st and 2 nd Respondents, namely the Cabinet Secretary for Health and the Principal Secretary in the State Department for Medical Services, oppose the Petition through an extensive Replying Affidavit sworn by Harry K. Kimtai, the Principal Secretary, together with detailed written submissions filed on their behalf. In essence, they mount a robust defence of the impugned procurement process and the legal framework under challenge.
55. The 1 st and 2 nd Respondents contend that the dispute presented before the Court is, in substance, a procurement and tendering dispute rather than a constitutional controversy. Consequently, they argue that this Court ought not to assume jurisdiction in the first instance. In this regard, they invoke the doctrines of constitutional avoidance and exhaustion of statutory remedies, relying inter alia on the decision of the Supreme Court in Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others.
56. On the merits of the dispute, the 1 st and 2 nd Respondents provide a detailed account of the procurement process, maintaining that the entire process was conducted in strict conformity with the law. They justify the adoption of the Specially Permitted Procurement Procedure (SPPP) under Section 114A(2)(d) of the Public Procurement and Asset Disposal Act, 2015 on the basis that the Integrated Healthcare Information Technology System (IHITS) project required a strategic partner capable of financing the substantial upfront costs associated with the establishment of a nationwide digital health infrastructure.
57. According to the 1 st and 2 nd Respondents, the magnitude and complexity of the project rendered conventional procurement methods impracticable and uneconomical. They further trace the conceptual origins of the project to the Government’s policy initiatives under the BETA agenda and the national development blueprint contained in Kenya Vision 2030, as well as several policy and technical reports, including the Kenya Digital Health Landscape Assessment Report, 2023, which recommended partnering with an entity possessing extensive nationwide technological infrastructure.
58. With regard to the identity of the procuring entity, the 1 st and 2 nd Respondents contend that the Ministry of Health, through the State Department for Medical Services, was the legally mandated body to undertake the procurement. They rely on Presidential Executive Order No. 2 of 2023 on ‘the Organization of the Government of the Republic of Kenya’, which assigned responsibility for “ E-Health” functions to the State Department for Medical Services.
59. They further invoke Section 105(3) of the Health Act, 2017, which empowers the Ministry of Health to facilitate the establishment and maintenance of a comprehensive integrated health information system. The 1 st and 2 nd Respondents also submit that at the time the procurement process was initiated in June 2023, the Digital Health Agency had not yet been established; since the Digital Health Act [ Act No. 15 of 2023] only came into force on 19 th October 2023 and its full operationalization was anticipated to take considerable time. They add that the impugned contract itself expressly contemplates the role of the Digital Health Agency and is intended to equip the Agency, together with other health institutions, with the requisite digital infrastructure.
60. The 1 st and 2 nd Respondents also address the Petitioners’ concerns relating to intellectual property rights arising from the contract. They explain that the contractual arrangement adopts a Software-as-a-Service (SaaS) model, which they describe as a widely accepted and cost-efficient approach to large-scale digital infrastructure projects. Unde
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