- In a note to all staff dated December 22, Acting Vice-Chancellor (Administration, Planning and Development) Prof. Richard Mulwa said that a meeting held by the university’s governing board had decided that staff would not receive full salaries from December.
- The notice added that the university had not yet received capitation or state funding for December.
Egerton University will not pay the full salaries of its staff and faculty from December, exposing the financial crisis facing public universities.
In a note to all staff dated December 22, Acting Vice-Chancellor (Administration, Planning and Development) Prof. Richard Mulwa said that a meeting held by the university’s governing board had decided that staff would not receive full salaries from December.
The notice added that the university had not yet received capitation or state funding for December.
In recent years, the Treasury has reduced allocations to universities in the face of continuing income deficits and debt payment obligations which have increased pressure on the Exchequer.
“It has been determined that the University will not be able to pay full salaries from December 2021,” the notice in copy to vice-chancellors, directors, directors and deans of faculties, among others, reads.
Public universities found themselves in serious financial difficulties, blamed on declining student populations, mismanagement and poor state funding. In recent months, a number of universities have had to cut some courses and close satellite campuses to reduce operating costs.
Kenya has 102 public universities and campuses – which posted a deficit of 6.2 billion shillings through June and received nearly 70 billion shillings from the treasury to run their operations.
The University of Nairobi (UoN) and Kenyatta University plunged into a combined financial deficit of 4.3 billion shillings, underlining the cash flow problems of institutions that saw them seek to increase tuition fees.
The Treasury revealed to parliament that the UoN had a deficit of 2.17 billion shillings through June, down from 1.62 billion shillings a year earlier.
The report said Egerton University needed 1.3 billion shillings to break even, Moi University lacked 1 billion shillings while Technical University of Kenya was in deficit. 769 million shillings to remain operational.
Kenyatta University’s deficit fell to 2.13 billion shillings during the period under review from 1.3 billion shillings as the institution relied on short-term loans to finance its operations.
Cash-strapped universities have been unable to pay legal deductions such as pensions and taxes, prompting warnings from the Kenya Revenue Authority over fears of asset foreclosures.
Egerton’s advice will worsen the situation at the university amid workers’ strike calls against what they have called sustained and systematic industrial injustice and employer cruelty.
Kenya has come under pressure from the World Bank to shut down and merge cash-strapped public universities and loss-making parastatals in what would see thousands of civil servants lose their jobs.
The multilateral financier believes Kenya should merge higher education institutions due to duplication of courses and the need to cut spending.
Since last year, vice-chancellors have pushed the government to increase fees nearly three times, in a bid to ease cash flow problems plaguing institutions.
“Kenyan universities are going through a serious financial crisis due to a continued decline in public funding amid rising costs of administering education,” the Fund said in a report.
Data shows that the current year’s allowance will cover 49.51 percent of tuition fees per student, up from the required 80 percent. Universities and students pay the remaining costs.
The reduced allocation per student saw the funding gap more than double over the two years, exposing universities already affected by the reduction in self-sponsored student enrollments.