University debts hit Sh98 billion

Kenyatta University entrance. [Elvis Ogina, Standard]

A section of Members of Parliament has raised concerns over ballooning debt in public universities.

Drawn from the National Assembly Education Committee, the MPs also warned that stalled infrastructure projects, adding that the Higher Education risks financial collapse if urgent corrective measures are not taken.

The deep-rooted financial and policy challenges facing universities require urgent reforms to restore fiscal discipline and protect access to higher education.

The concerns emerged when Higher Education Principal Secretary Beatrice Inyangala appeared before the MPs over the Supplementary Estimates for the 2025/26 financial year.

The Education Committee, chaired by Tinderet MP Julius Melly, painted a grim picture of the sector’s financial health, revealing that pending bills in universities had surged from Sh15 billion two years ago to a staggering Sh98 billion as of December 31, 2025.

“Two years ago, pending bills stood at Sh15 billion. Today, they have hit Sh60 billion and are now at Sh98 billion. At this rate, the State Department will be insolvent,” Melly cautioned.

“You must explain to this country how these obligations keep rising.”

Official documents tabled before the committee indicate that public universities have accumulated pending bills amounting to Sh98.06 billion, with no clear provision for their settlement in the current budget ceilings.

Lawmakers also questioned the continued allocation of funds to new infrastructure projects despite numerous stalled developments across institutions.

The Department listed at least nine stalled projects across universities, including the University of Nairobi, Moi University, Egerton University, and Laikipia University, with some recording completion rates as low as 0.31 per cent.

Kitutu Masaba MP Clive Gesairo criticised the prioritisation of new infrastructure over student support.

“We have stalled projects, yet we are still funding new ones. Why are we putting money into infrastructure instead of supporting HELB or exploring partnerships with the Housing Department to build hostels?” he posed.

The committee noted that the Higher Education Loans Board (HELB) remains severely underfunded, with a cumulative deficit of Sh43.6 billion.

As a result, over 453,000 eligible students have been left without financial support in the current financial year.

Luanda MP Dick Maungu questioned the viability of some of the proposed allocations, warning that funds may go unutilised due to time constraints.

“We are barely two months from the end of the financial year. This money cannot be absorbed. Is it a genuine project or a disguised pending bill?” he asked.

Further scrutiny was directed at funding to private universities, where a historical deficit of Sh60.28 billion has accumulated under the Differentiated Unit Cost (DUC) model.

Kuresoi North MP Joseph Makilap demanded clarity on how the government plans to address the growing debt burden.

“What concrete plans do you have to ensure we dispose of this escalating debt in private universities?” he asked.

Luugari MP Nabii Nabwera questioned the rationale behind the continued placement of government-sponsored students in private institutions despite the underutilised capacity in public universities.

In response, PS Inyangala defended the government’s position, noting that new placements to private universities had been halted.

“We have stopped sending students to private universities. However, those already there can still apply for HELB support,” she said.

However, concerns over data integrity also emerged, with MPs citing inconsistencies in budget figures.

Gesairo pointed to abrupt changes in pending bill figures for Kisii University, raising questions about the accuracy of financial reporting.

The committee has now demanded a verified list of all pending bills and clearer justification for supplementary allocations, warning that failure to address the issues could further destabilise the higher education sector.