By Prof. Karuti Kanyinga
Adapted from an article first published by the Daily Nation
Many universities in Kenya are experiencing serious financial distress. Several are unable to meet basic operational costs, including paying salaries, while some are effectively insolvent—unable to settle their debts or remit statutory deductions.
Public discussion around this crisis often points to inadequate government funding and low student tuition fees. These are valid concerns. However, the most immediate problem is the ballooning debt. Universities have accumulated obligations that exceed their annual allocations, especially those arising from Collective Bargaining Agreements (CBAs) and other long-term commitments.
While clearing these debts could offer short-term relief, the sustainability of universities remains in question, especially if government funding continues to be erratic.
More Than Just a Funding Problem
Kenya invests significantly in education. The education sector receives about 25% of the national budget—well above the continental average. Government spending on education is 5.3% of GDP, outperforming the Sub-Saharan average of 4.5%, and even exceeding countries like Malaysia (4.2%) and Indonesia (3.5%). At the higher education level, Kenya spends around 1.2% of GDP—higher than South Africa (0.9%), and comparable to the Netherlands and Germany. It even exceeds the UK’s 0.5%.
Kenya also has a higher-than-average tertiary enrolment rate in Sub-Saharan Africa. As of 2018, the gross enrolment rate stood at 11.5%, compared to the regional average of 9%. This is expected to grow with the introduction of the Kenya Open University.
Clearly, the issue is not just about allocation—though funding remains a concern. It is also about how universities are managed and how resources are utilised.
A Legacy of Missed Opportunities
The collapse of parallel (Module II) programmes is a key turning point. These programmes once provided significant revenue, enabling many universities to thrive. However, many institutions failed to reinvest these funds into core functions such as research, infrastructure, and staff development. Few anticipated the decline of this revenue stream and, when it ended, they were left with bloated wage bills and limited funding.
While funding remains essential, it is only part of the solution. A combination of financial prudence, stronger governance, and strategic investment in research is necessary to make Kenya’s universities sustainable and globally competitive.
Budgetary allocations remained stagnant despite growing student numbers. Tuition fees have not been adjusted since 1989, and the Differentiated Unit Cost model has not been adequately implemented. This has left universities unable to cover recurrent costs, especially after CBAs led to increased salary obligations without corresponding budget increases.
Governance and Strategic Vision
Besides funding, poor governance and weak financial management have exacerbated the crisis. Few universities linked funding to performance or research productivity. As a result, many prioritised teaching at the expense of research and graduate training. This is reflected in international rankings—no Kenyan university is currently ranked among the world’s top 300. In contrast, institutions in South Africa and Egypt regularly make this list.
The difference lies in prioritisation. Countries that perform better have aligned university research with national development goals. For example, South Africa incentivises scholars to publish in peer-reviewed journals, and the government uses academic research to inform policymaking. Such strategies have helped improve both academic output and relevance.
What Needs to Be Done
- Settle Existing Debts: The government must address the immediate burden of debt accumulated due to underfunded CBAs and recurrent obligations.
- Reform University Governance: Universities must adopt sustainable financial models, improve accountability, and diversify revenue sources.
- Revise Tuition Structures: Fees need to reflect the actual cost of education while maintaining accessibility for disadvantaged students.
- Invest in Research and Innovation: Kenya must reward research productivity and support faculty to publish in international journals.
- Align University Outputs with National Needs: Research must be made useful and impactful—shaping policy, innovation, and community development.
University education plays a critical role in shaping the quality of human capital. If underfunded and mismanaged, universities will continue to underperform—producing graduates ill-equipped for a competitive global environment. While funding remains essential, it is only part of the solution. A combination of financial prudence, stronger governance, and strategic investment in research is necessary to make Kenya’s universities sustainable and globally competitive.
About the Author
Prof. Karuti Kanyinga is a Research Professor at the Institute for Development Studies (IDS), University of Nairobi. He is a distinguished scholar in governance, development, and public policy, with extensive research on political participation and electoral processes in Kenya.