VCs reject team picked to probe financial crisis in universities

Graduands following the proceedings during Kenya Methodist University's 19th graduation ceremony in Meru on October 12, 2019. [Olivia Murithi, Standard]

Vice-chancellors have questioned a move by the Ministry of Education to set up a team to investigate financial challenges facing their institutions, terming it a waste of time.

The VCs argue that the problems facing institutions of higher learning have over the years been adequately deliberated by stakeholders, documented and suggestions made on way forward.

The VCs say their last meeting in Mombasa, which was attended by officials from the National Treasury and Ministry of Education, and MPs drew solid action plans, complete with timelines for implementation.

The stakeholders met in Mombasa from February 4-7 where they discussed issues related to sustainable funding of university education, research, science, technology and innovation, policy on placement and role of accreditation bodies.

However, two months later, State Department for University Education Principal Secretary Simon Nabukwesi appointed a ‘think tank’ to help in developing a new framework that would provide sustainable solutions to the permanent phenomenon.’

The 11-member team is led by Prof Egara Kabaji, former Deputy Vice-Chancellor at Masinde Muliro University of Science and Technology (Mmust).

Nabukwesi wants the team, to within 30 days, determine the debt burden of the universities and how it morphed into the present levels.

The team will also categorise universities in terms of debt burdens and develop a framework for stabilising the institutions.

 Prof Egara Kabaji (R) during the launch of the 2014 Burt Award for African Literature winning books, February 16, 2015. 

Additionally, the team will provide a framework for the sourcing of funds outside the Exchequer support and provide practical steps for operationalisation.

VCs who spoke to The Saturday Standard underlined that terms of reference for the team contains matters already discussed and solutions proposed and that there exists a Universities Funding Board (UFB), whose mandate is well explained under Section 53 of the Universities Act on resource mobilisation and allocation of funds to institutions.

The VCs said the meeting identified funding as the greatest challenge universities face and drew a 14-point action plan, which will help them overcome the cash crunch.

Waste of time

“All these issues, which the think-tank are being told to do are known. It’s a waste of resources given that high-level meetings have been held to discuss these matters and suggestions put forth,” said a VC in one of the top public universities.

The VCs regretted that the new team will not come up with different findings, contrary to what they discussed in Mombasa, on universities funding challenges.

“They will state the same things using different English terms but the issues affecting universities are known. Let the government just implement the various road maps that have been agreed upon,” said another VC.

National Assembly Education Committee chairperson Florence Mutua said terms of reference set for the think-tank had been covered during the Mombasa meeting.

“We agree that the only task force that was to be set up was to find out how the debts reached that high and how institutions can use appropriations in aid to plug their deficits,” said Mutua.

According to the meeting’s recommendations, a multi-sectoral technical team was to be set up by June this year, to guide holistic reforms in the university sector.

In his presentation during the meeting, PS Nabukwesi admitted there are challenges facing universities and explained 12-key points that would make higher education sustainable.

Amb. Simon Nabukwesi, PS University Education and Research. [Wilberforce Okwiri, Standard]

Among the top recommendations is a review of universities appropriations in aid projection due to declining enrollment for module II programmes, and to encourage cost reduction, increase efficiency and effective use of available staff.

He also proposed an increase in Differentiated Unit Cost (DUC) to 80 per cent, translating to about Sh73.91 billion to cater for increase from the current Sh41.907 billion, which is only 53 per cent for public universities and Sh2.4 billion (18 per cent) for private universities.

He also proposed building capacity for universities on resource mobilisation to attract funding and set up a special fund to bail out institutions, service pending bills and provide adequate resources.

VCs said after the stakeholders meeting, the next phase in addressing the funding problem was how to implement the proposals.

“You can clearly see that the PS already knows the issues to be addressed. We do not need another team to diagnose our problems,” said another VC.

Overall, the resolutions made by the stakeholders during the Mombasa meeting reveals solid action plans for sustainable funding solutions complete with timelines.

The stakeholders resolved that to address the declining government funding to university education and research, re-allocation of resources within the sector be done immediately to match the growth in funding level in sectors.

A new policy to guide universities on borrowing whenever there is need for Cabinet consideration was agreed to be developed by June this year.

The meeting also agreed to review the contribution of household fees after robust consultations with all the stakeholders within the 2021/23 financial year.

It was also resolved that there be established resource mobilisation strategies by June, to include developing policy to guide universities on borrowing and financing models for assets.  

Many other recommendations were made on full implantation of the Differentiated Cost Unit (DUC) and to eliminate large disparity between public and private universities.

Professor Geoffrey Muluvi (second left) shows off the Kebs standardization certificate that approving the manufacture of hand sanitisers. [Philip Muasya, Standard]

On pending bills, the meeting agreed that by June this year, a Cabinet Memo paper be prepared to waive statutory payments to Kenya Revenue Authority (KRA).

Meeting also agreed on provision of conditional grants to support universities to clear outstanding debts such as pension, Sacco, NHIF and other service providers. This is to be done by June.

Data presented by the VCs to the National Assembly show that public universities are experiencing unprecedented financial constraints including accrued statutory payments to Kenya Revenue Authority (KRA), pension scheme dues, insurance premiums, Sacco contributions, NHIF and NSSF.

Debt level

Prof Geoffrey Muluvi, vice chancellors’ committee chairperson, said the universities bosses revealed that the total amount owed to these institutions by September last year was Sh37.3 billion most of which were due to KRA.

On pensions, VCs report says that since 2010-2013 CBA, universities have been unable to remit about Sh3 billion.

Far-reaching proposals were also made on universities low funding for development projects. An agreement was reached on a framework for development of idle assets and resourcing and mobilisation to provide services and income through public-private partnerships.

A framework is to be developed for the disposal of idle assets and another one for transferring idle assets to other universities wherever the need arises. 

Other areas with strong recommendations by the stakeholders were on bloated or unbalanced workforce, weak data management and rapid expansion of universities, which have led to resources being spread thinly.

Inadequate student financing from Higher Education Loans Board, inadequate commercialisation of research and intellectual property and streamline policy on placement of government-sponsored students in universities and

A review of multiple charges paid by universities to professional/regulatory bodies and development of a policy on online and blended learning were also strong areas of action plans with suggested timelines.