State-sponsored students opting to join private universities will have to foot their own tuition cost in a policy shift targeted at resolving the funding crisis in public varsities.

Education Cabinet Secretary Ezekiel Machogu told Parliament Thursday that this is part of reforms in the higher education sector to make the universities financially sustainable.

The public institutions are struggling to honour obligations such as payroll taxes, retirement benefits, and insurance premiums for employees, with pending bills ballooning to Sh62 billion amid a drop in State capitation.

“Henceforth, no government grant is going to a private university and parents opting to enrol their children in private institutions shall have to bear the cost,” he told the National Assembly Public Investments Committee on Education and Governance (PICEG).

His remarks come a day after President William Ruto announced a new funding model for universities and technical and vocational education and training (Tvet) institutions that will be student-centred, where financing is apportioned to individuals according to their level of need.

Funding to students shall combine scholarships, loans and household contributions on a graduated scale, scientifically determined.

The categorisation of students will be in four levels of need – vulnerable, extremely needy, needy and less needy.

Under the new model, universities and Tvets will no longer receive block funding in the form of grants based on differentiated unit cost (DUC), as is currently the case.

To facilitate the implementation of the new framework, the State has increased funding for university education to Sh84.6 billon from Sh54 billion allocated in the current financial year as loans and grants.

This translates to an allocation increase per student from Sh152,000 to Sh208,000.

The budgetary allocation for Tvets will increase from Sh5.2 billion to Sh10 billion starting in July, translating to Sh67,000 per year per trainee.

“We have already written to the Attorney General for an amendment to be brought to Parliament to address the placement of students matter and to ensure it conforms to the law,” said Mr Machogu.

Private universities started admitting government-sponsored students (GSS) in 2016 in a move by the State to address congestion in public institutions.

The Kenya Universities and Colleges Central Placement Service (KUCCPS) has since allowed students to select courses from whichever university, despite their differing financial backgrounds.

“The committee is also in the process of coming up with a Bill that will functionally tighten up any loose ends to ensure that public universities do not continue to suffer at the expense of private ones,” said PICEG chairman Wanami Wamboka.

However, a section of youthful legislators led by Embakasi East MP Babu Owino has dismissed the new funding framework, saying it will deny Kenyans access to quality education.

“The new higher education financing policy is a money laundering scheme, and should the government fail to finance students at 100 percent we will call nationwide demonstrations,” he told journalists at Parliament buildings.

Private universities currently have a total of 78,650 GSSs with a DUC requirement of Sh12.28 billion against the unmatching budget allocation of Sh3.37 billion – translating to 21 percent of the DUC — in what has compelled some of them to increase tuition fees.

Similarly, inadequate State funding, low student enrollment and the scrapping of parallel programmes have seen public universities struggle to honour obligations for employees.

The number of candidates meeting the minimum university entry qualification in the 2022 Kenya Certificate of Secondary Education (KCSE) examination rose by 19 percent to 173,345 compared to 145,776 recorded the previous year.

Over the past five years, nearly all students who scored C+ and above were admitted to the regular university programmes, reducing the pool of learners available for private universities and self-sponsored degree programmes in public ones.

The sharp drop in the number of self-sponsored students enrolled in public universities has resulted in cash flow challenges leading to a freeze in new hiring and a slowdown in expansion plans as they struggle with huge debts.

State-sponsored students opting to join private universities will have to foot their own tuition cost in a policy shift targeted at resolving the funding crisis in public varsities.

Education Cabinet Secretary Ezekiel Machogu told Parliament Thursday that this is part of reforms in the higher education sector to make the universities financially sustainable.

The public institutions are struggling to honour obligations such as payroll taxes, retirement benefits, and insurance premiums for employees, with pending bills ballooning to Sh62 billion amid a drop in State capitation.

“Henceforth, no government grant is going to a private university and parents opting to enrol their children in private institutions shall have to bear the cost,” he told the National Assembly Public Investments Committee on Education and Governance (PICEG).

His remarks come a day after President William Ruto announced a new funding model for universities and technical and vocational education and training (Tvet) institutions that will be student-centred, where financing is apportioned to individuals according to their level of need.

Funding to students shall combine scholarships, loans and household contributions on a graduated scale, scientifically determined.

The categorisation of students will be in four levels of need – vulnerable, extremely needy, needy and less needy.

Under the new model, universities and Tvets will no longer receive block funding in the form of grants based on differentiated unit cost (DUC), as is currently the case.

To facilitate the implementation of the new framework, the State has increased funding for university education to Sh84.6 billon from Sh54 billion allocated in the current financial year as loans and grants.

This translates to an allocation increase per student from Sh152,000 to Sh208,000.

The budgetary allocation for Tvets will increase from Sh5.2 billion to Sh10 billion starting in July, translating to Sh67,000 per year per trainee.

“We have already written to the Attorney General for an amendment to be brought to Parliament to address the placement of students matter and to ensure it conforms to the law,” said Mr Machogu.

Private universities started admitting government-sponsored students (GSS) in 2016 in a move by the State to address congestion in public institutions.

The Kenya Universities and Colleges Central Placement Service (KUCCPS) has since allowed students to select courses from whichever university, despite their differing financial backgrounds.

“The committee is also in the process of coming up with a Bill that will functionally tighten up any loose ends to ensure that public universities do not continue to suffer at the expense of private ones,” said PICEG chairman Wanami Wamboka.

However, a section of youthful legislators led by Embakasi East MP Babu Owino has dismissed the new funding framework, saying it will deny Kenyans access to quality education.

“The new higher education financing policy is a money laundering scheme, and should the government fail to finance students at 100 percent we will call nationwide demonstrations,” he told journalists at Parliament buildings.

Private universities currently have a total of 78,650 GSSs with a DUC requirement of Sh12.28 billion against the unmatching budget allocation of Sh3.37 billion – translating to 21 percent of the DUC — in what has compelled some of them to increase tuition fees.

Similarly, inadequate State funding, low student enrollment and the scrapping of parallel programmes have seen public universities struggle to honour obligations for employees.

The number of candidates meeting the minimum university entry qualification in the 2022 Kenya Certificate of Secondary Education (KCSE) examination rose by 19 percent to 173,345 compared to 145,776 recorded the previous year.

Over the past five years, nearly all students who scored C+ and above were admitted to the regular university programmes, reducing the pool of learners available for private universities and self-sponsored degree programmes in public ones.

The sharp drop in the number of self-sponsored students enrolled in public universities has resulted in cash flow challenges leading to a freeze in new hiring and a slowdown in expansion plans as they struggle with huge debts.