The National Treasury has failed to allocate crucial funds for key universities in the 2024-2025 budget, putting the higher education sector in a state of crisis.
Funding Cuts and Their Impact
Initially, the Budget Policy Statement for 2024-2025 had earmarked significant funds for major universities: Sh1.725 billion for the University of Nairobi, Sh1.3 billion for Moi University, Sh702.7 million for the University of Eldoret, and Sh339.6 million for the University of Kabianga. However, the published budget estimates showed zero allocation for these institutions. This drastic reduction in funding places the education of many students in jeopardy, especially those entering their third to sixth years.
Higher Education Loans Board in Deficit
The Higher Education Loans Board (Helb) is also struggling with a substantial deficit of Sh11.4 billion. Due to this shortfall, Helb can only support 21,512 incoming students out of the 122,634 expected to join universities in September. This leaves over 100,000 students without the necessary tuition and upkeep loans, significantly reducing their chances of continuing their education.
Operational Challenges for Universities
Public universities are already facing financial difficulties, with over Sh76 billion in pending bills. The budget cuts further strain their financial health, risking insolvency and disrupting operations. The Auditor-General has noted that 23 out of 40 public universities and their constituent colleges are technically insolvent, meaning they cannot settle their debts and pending bills.
This financial instability has immediate consequences. For instance, Kenyatta University recently informed its staff that it could not pay their salaries due to delayed government capitation. This situation is likely to be replicated across other institutions, leading to potential strikes by staff and students. Such disruptions could severely impact academic activities and further destabilize the universities.
Impact on Research and Innovation
The budget also neglects funding for research, feasibility studies, and project preparation. Initially, Sh7.9 million was allocated for these activities in the Budget Policy Statement, but this has been cut. Without funding, universities cannot engage in critical research activities, affecting their contributions to innovation and national development.
Uncertainty for Government-Sponsored Students in Private Universities
Government-sponsored students in private universities also face uncertainty as the budget remains silent on their funding. This lack of clarity could lead to reduced enrollment and financial challenges for these institutions, further complicating the higher education landscape in Kenya.
Government’s Response and Future Prospects
The State Department for Higher Education has appealed to the National Assembly for additional funding. In its submission to the Education and Research Committee, the department emphasized the need for adequate resources to maintain high-quality education standards and support the growth of new generation universities. The current funding levels are insufficient to meet the operational needs, including teaching materials, equipment, and adequate staffing.
Last year, the government introduced a new university funding model. Under this model, students’ education costs are covered through a mix of scholarships, loans, and bursaries based on need. However, students admitted before this model was introduced continue to be funded through the differentiated unit cost model, which is now inadequately funded. The proposed budget cuts could reduce government support for degree programs to just 30% of their cost, down from the intended 80%, severely impacting the quality of education.
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