Varsities to receive Sh8.6bn to bridge financing deficit

Public universities will receive an additional Sh8.6 billion from the exchequer to enable them bridge the financing deficit in the current financial year.

Despite the additional funding, universities have been grappling with unremitted deductions amounting to more than Sh32 billion as of June 2020.

State department for University Education Principal Secretary Simon Nabukwesi called on the education committee to approve budget requests.

He said the lack of sufficient funding has crippled functions in universities.

Nabukwesi requested the committee to consider increasing funds to support ongoing projects.

“The State Department had requested the National Treasury to provide an additional Sh3.3 billion in the supplementary budget,” he said.

Higher Education Loan Board CEO Charles Ringera requested another Sh3 billion to enable the board process loans for students.

Ringera cited an overhaul of applicants versus the total allocation to the loans board.

“A large number of students, 75,000, applied this time, all the way upto TVETs. We request the committee to enhance budgetary provision,” Ringera said.

He added that the agency has already disbursed Sh2.5 billion to applicants with the remaining Sh3.2 billion set to be disbursed next week.

Out of the Sh202.8 billion allocated to the Ministry of Education in the financial year 2021/2022, Sh76.3 billion was directed to universities.

In the current financial year, the total capitation was raised to Sh103 billion in the supplementary budget.

This reflects an increased Sh8.6 billion for university education and another Sh25 million towards research, science, technology, and innovation.

On research, the state department for University Education CFO Dismus Ogot said the funding keeps reducing.

Ogot said the funding was reduced from Sh1.86 billion in 2018/2019 to the current budget of Sh323 million.

He requested the education committee to consider increasing funding which will in turn spur collaborative research and commercialisation of research output.

“We request for Sh100 million to NRF and Sh20 million to the Kenya National Innovation Agency,” Ogot said.

Kenya national innovation agency is among state agencies in the university sub-sector set to benefit from these funds; if the education committee approves.

Rongo University made the second-highest request of Sh167 million, after JKUAT which required Sh186 million to complete an ongoing project.

Rongo plans to bridge the funding gap for the construction of the school library (Sh67 million) and an additional Sh100 million for personal emoluments.

The technical university of Kenya seeks to bridge the funding gap with a frequent freeze of the school accounts.

The University of Nairobi requested for Sh112.5 million to offset court awards on pending bills.

The bills are said to arise from the construction of various facilities at Kikuyu Campus and lower Kabete Campus Hostel.

Institutions that requested Sh100 million each are Moi University, Jaramogi Oginga Odinga, Koitalel Samoei University College, Maseno University.

Others are Kirinyaga University, Garissa University, Laikipia and Meru University of Science and Technology.

According to data from the Ministry of Education, 25 university campuses were closed down.

The campuses belonged to 14 universities.

They are Kisii (eight), Laikipia University (eight), Moi University (five), Maseno University (one), Baraton (two), Egerton (two) and JKUAT (four).

Others are Karatina University (six), Kabarak University (one), Catholic University (two), SEKU(one), Cooperative University (two), KEMU (one) and Mount Kenya University (one).

The cash crunch in universities called for international invention by World Bank and International Monetary Fund in 2021.

In late April, a number of conditions were set for the Sh234 billion loans.

 IMF urged the government to offset loans by three universities, Moi University, UoN and Kenyatta University.

They also called for merging of institutions, a suggestion that faced backlash from dons.

Moi University and Egerton University have been closed for a number of months, since 2021.

At Egerton, the strike has been going on for the past two and a half months starting November 12, last year.

Dons raised concerns on poor remunerations and non-compliance with their 2017-2021 collective bargaining agreement.

Last year, Moi University shut down operations and sent students home over financial challenges.

The institution had over Sh1.06 billion in debt in statutory deductions to be remitted.

The cash crisis witnessed in universities has been attributed to the new funding method, Differentiated Unit Cost.

In DUC, the government provides 80 per cent; the remaining 20 per cent is to be generated by the institution.

Public universities were not fully funded in the financial year 2021/2022.

This is despite implementing the newly introduced funding method which allows the state to cater for 80 per cent.

Only 49.5 per cent was disbursed.

This called for alternative methods adopted by universities to bridge the funding gap.

For instance, a number of universities increased tuition and accommodation fees.

Other universities restructured and reduced bloated staff to reduce salary expenditure.

UoN raised their tuition fees for a number of courses while hostel fees was increased seven-folds.

The university more than doubled the fees for postgraduate courses and parallel degrees.

Students pursuing medicine were to part with Sh3.8 million for the five-year course, up from Sh2.35 million, beginning August.

For master’s courses like communications, the fee was increased to more than Sh600,000.

This is for a two-year programme from an average of Sh275,000, reflecting an increase of 118 per cent.

Hostel fee was increased from the initial Sh6,000 per year to Sh40,000 per year.

Tuition fee was increased from Sh28,000 per academic year to almost Sh59,000 per semester.