This archive report was first published on 17 June 2020.
June 17, 2020, marked a worrying day for Kenya's public universities, with the revelation that they have accumulated pending bills estimated at Sh19 billion. This staggering figure is a clear indication of the financial health of these institutions and the welfare of their staff.
The Retirement Benefits Authority (RBA) report tabled in Parliament highlights the dire financial situation of the State-funded institutions of higher learning. Despite the demand for higher education remaining strong, these universities are struggling to meet their statutory deductions, putting the health and welfare of their staff in peril.
Remitting deductions for the National Social Security Fund (NSSF), National Hospital Insurance Fund (NHIF), pension funds, and Higher Education Loans Board (Helb) should be automatic. However, the failure of universities to live up to their obligations is a clear sign of insolvency that must be addressed fast to avoid a potential collapse of these institutions and safeguard the interests of affected workers.
Traditional revenue streams for universities and colleges are under pressure globally, and it requires a strategic shift in how these institutions are managed. Relying solely on tuition fee collections and government funding is no longer sustainable, and university managers must consider tackling the current financial challenges through innovative strategies.
These strategies include the enhanced use of technology to cut costs, exploring new markets, improving efficiency in operations, seeking partnerships and endowments, and prioritizing academic programmes to offer competitively. By providing value for money, universities can open room for funding and partnerships, ultimately breaking their long dependence on State funding and fees.
Globally, top universities are reporting increased 'other income' revenue from streams such as intellectual property rights and property deals. Many are also making money through research and innovation partnerships with the private sector. These models should be replicated in Kenya to help universities and colleges navigate their financial challenges.
