Ruto’s Proposal to Merge Helb, Varsity Fund Strongly Opposed
Education stakeholders in the university sector have criticized a proposed merger of two financial organizations.
President William Ruto suggested the merger of the Higher Education Loans Board and the Universities Funding Board in his education charter.
Helb’s mission is to give funding (through loans, scholarships, and bursaries) to Kenyans seeking higher education at institutions of higher education in Kenya and abroad.
While it is the responsibility of the universities’ funding board to develop transparent and equitable criteria for the allocation of funds to public universities and to issue conditional grants to private universities, the universities’ funding board is required to establish transparent and equitable criteria for the allocation of funds to private universities.
UF also allocates cash to public universities and issues conditional grants to private colleges based on set criteria.
Melvin Thogo, president of the University of Nairobi Student Association (UNSA), stated that the plan would not solve the university’s finance crisis.
This is the simplest way to disenfranchise students from this fund, even though it may initially appear appealing.
Friday, the UNSA chairwoman presented her recommendations to the presidential Working Group on education reforms.
“Amalgamating the funds means the university administration will directly receive the money and then disburse them to students,” Thogo said.
If this is implemented, universities will use the funds for other expenses, according to Thogo.
“The university administration will obviously use these funds to pay for their expenditures first before disbursing them to the students. This means the amount disbursed to the students might be reduced or not disbursed at all,” she said.
Furthermore, professors oppose the merger, arguing that it will compromise the openness of the distributed monies.
Maloba Wekesa, secretary of the UASU chapter at the UoN, stated that integrating the mandates of Helb and UF would be an enormous error.
Maloba stated that the two organizations should be permitted to operate autonomously within their scope.
Wekesa opined that merging the Higher Educations Loans Board with the University Fund would be ill-advised. The Higher Educations Loans Board is responsible for the administration of student loans.
The union secretary stated that university funding should be budgeted and distributed semi-independently from the Ministry through the University Fund.
Previously, Education CS Ezekiel Machogu asked public colleges to produce their own revenue.
However, according to Wekesa, colleges still require government backing to establish their own revenue streams.
“The Government should consider building capacities for Universities to generate more resources to supplement Government funding,” he said.
This, according to Wekesa, can be accomplished by establishing enterprise centres at universities, for instance. Language Centres, Engineering Workshops, Horticultural Centres, IT Hubs, and Hospitals.
Nonetheless, UF CEO Geoffrey Monari stressed that the revenue creation strategy is not sustainable.
Monari stated that colleges’ enterprises fail owing to a lack of financial resources.
“For example, we have Maseno University which has a hotel. It is because they lack expertise for the business and lengthy costly procurement processes since they are government” he said.
Monari stated that it is difficult to operate university enterprises because the government cannot engage in business competitively without a waiver.
According to information obtained from the financing agency, the accumulated debt consists of, among other things, remittances, part-time professors, Sacco, and contractors.
The institutions owe Sh1.4 billion to contractors, Sh4.5 billion to part-time academics, Sh4.8 billion to suppliers, and Sh4.1 billion to Saccos.
NSSF is owing Sh139 million, NHIF is owed Sh2 million, loan deductions are owed Sh1.3 billion, pension plans are owed Sh18 billion, PAYE is owed Sh13 billion, and other loans total Sh10 billion.
The Kenya University Students Organization requested President William Ruto intervene in HELB-related concerns.
The chairman of the Kenya University Students Organization, Anthony Manyara, sent a letter to President Ruto on September 26 detailing the plight of university students in need.
Manyara demanded that an intervention or direction be given to end the blame-shifting games between HELB and the Treasury.
He charged HELB with delaying the distribution of funding to pupils.
Charles Ringera, the chief executive officer of HELB, remarked before that the operating schedule of the Treasury and the school calendar differ.
Currently, students are in the midst of a semester, although according to Ringera, the fiscal year for the Treasury begins in June.
Kenya Kwanza, led by Ruto, had pledged to revamp HELB to provide loans without interest.
However, Ringera stated that the government of Kenya Kwanza’s proposal to provide university students with interest-free loans could be pricey.
He stated that HELB could fund 347,166 students to the tune of Sh14.8 billion for the fiscal year 2021-22.
He stated that a board is charged with providing university students with grants.
He stated, “We already have the Universities Funding Board, which provides funding for university financing.”
The greatest collection for HELB in 2021 was Sh5.2 billion, and the board recovered Sh550 million from the Covid-19 penalty waiver.