At least eleven (11) public universities are staring at a KSh100 billion funding shortfall that has left them technically insolvent, despite increased allocations under the student-centred financing model.
Education officials told the National Assembly Committee on Education on Thursday that the gap has crippled operations, with some universities struggling to pay salaries, pensions, and meet basic obligations.
Higher Education and Research Principal Secretary Beatrice Inyangala revealed that the ministry is grappling with the deficit even as the government rolls out the needs-based model introduced by the President.
PS Inyangala said the ministry is pursuing strategies such as asset-based securitisation and enhanced loan recoveries, noting that monthly collections have risen from KSh500 million to KSh650 million. However, she admitted that high unemployment continues to limit full repayment of student loans.
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Inyangala explained that the new model ties funding to students’ financial backgrounds, programme costs, and institutional efficiency.
“Each household is assessed individually. Students from vulnerable backgrounds pay as little as KSh5,800 annually, while those from higher-income families pay up to KSh150,000,” she said.
Despite allocations rising with the Higher Education Loans Board now at Sh98.4 billion and the University Fund at KSh4.8 billion, MPs said universities remain in deep financial distress. Inyangala attributed the crisis to a mismatch between projected and actual disbursements, disclosing that about eleven public universities are technically insolvent. She singled out Moi University and the Technical University of Kenya as being in critical condition.
Moi University Acting Vice-Chancellor Prof. Isaac Kiplagat told MPs the institution received KSh1.5 billion last year, which was used to settle staff salaries and arrears. Yet, he said, the university still faces a pension liability of KSh4.5 billion. “We have approvals to liquidate some properties in partnership with the Pension Fund to clear arrears,” he explained.
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At the Technical University of Kenya, Vice-Chancellor Prof. Benedict Mutua painted an even bleaker picture. He said the institution has been unable to pay gross salaries since 2013, only managing net salaries. “Our monthly wage bill is KSh102 million, but Treasury releases less than KSh60 million. The staff-to-student ratio is nearly 1:1, which is unsustainable,” Mutua said.
HELB CEO Geoffrey Monari urged lawmakers to support prompt loan disbursements, stressing that timely payments would stabilise universities since “money follows the student.”
Committee Chairperson Julius Melly assured officials that Parliament would recommend measures to secure predictable and adequate financing.
By Masaki Enock
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