State To Cut University Funding – CS Yatani.
Universities are in for a tough time as the state plans to cut funding even further.
Treasury Undersecretary Ukur Yatani stated that the state “will no longer continue to fund universities to the tune they desire.”
In an interview with the Star, the Cabinet Secretary stated, “Public universities must be innovative in dealing with their own challenges,” implying that they must begin raising their own funds through commercial enterprises.
In a cautionary message, the National Treasury stated that the institutions must think “outside the box” to fund their operations.
According to CS Yatani, the government cannot continue to bear the majority of the burden — 80% — of student training.
He believes universities should consider raising tuition fees, perhaps from the current Sh40,000 per year to around Sh100,000.
The increase, according to the CS, would be to “match up to the market price of training a student.”
“What’s the cost of training a university student? It cannot be less than Sh200,000 factoring in tuition, lectures and library,” Yatani said.
“With students paying about Sh40,000, who is absorbing all the other costs? It is the government. That is why it is not sustainable,” he said.
The University Academic Staff Union has supported calls for a fee increase, urging that it be gradual rather than abrupt.
According to the CS, for the government to continue to support universities, “it has to raise taxes to get more money.”
Yatani stated that with the cost of living reaching new highs, the government may not consider raising taxes due to the negative impact.
Yatani, who is advocating for universities to shift away from their traditional reliance on government funding, believes that raising tuition fees will likely improve educational quality.
“They will be having quality books, teachers and a better environment for people to study and gain knowledge.”
The greater challenge according to Yattani is that most universities are not adapting to the current dynamics because they believe it is the government’s responsibility to support them.
According to the CS, management is still a challenge for the institutions.
“A lot has to do with patronage where people are given positions just because they come from a politician’s backyard. That needs to change,” he said.
He spoke in response to a recent International Monetary Fund assessment that revealed Kenya has limited fiscal space to bail out state-owned enterprises and, by extension, parastatals.
The IMF wants proactive efforts to address fiscal risks from state-owned enterprises.
Acting chairperson of the IMF Antoinette Sayeh said in a December 2021 report that financial support to SOEs will necessitate difficult trade-offs and adequate safeguards, given Kenya’s limited fiscal space and the need to maintain debt sustainability.
Thousands of University of Nairobi freshmen failed to report in October 2021 after the Prof Peter Kiama-led institution raised tuition fees.
More than 4,000 of the more than 10,900 students who received letters from the Kenya Universities and Colleges Central Placement Service did not report.
UON increased fees for government-sponsored students from Sh26,500 to Sh59,000 per year, disadvantageously affecting many students.
The fee for a liberal arts master’s course was doubled to Sh600,000, prompting a court petition that Judge Antony Mrima upheld.
The justice ruled that there was insufficient public participation, but he disagreed with KMPDU’s claims that the “increment was beyond the reach of many Kenyans.”
Many public universities are insolvent, with many failing to meet their obligations, which include taxes, retirement benefits, insurance, and payments to contractors and suppliers.
In audit reports, Auditor General Nancy Gathungu revealed that the institutions had been forced to rely on short-term loans to finance their operations.
She has highlighted instances of universities failing to make mandatory statutory remittances despite ongoing protests over delayed salaries.
According to a Universities Fund report, the government currently pays for nearly half of student training, leaving students and universities to cover the rest.
The funding gap, which is expected to widen further, and the gradual decline in student capitation, it is argued, could make things worse for varsities.
The report also reveals that university debts total well over Sh60 billion, with a warning that they are accumulating at an alarming rate.
As an alternative, Yatani urged the institutions to put their vast land to productive use adding that some have as many as 5,000 acres…some even have 10,000, while the varsity only has 50.
The rest are dormant. They are not producing anything, are not planting, and are not earning any money.
“We can even make a university town where people can benefit through establishing businesses. Universities must really come out of the traditional thinking,” Yatani added.
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He advised the colleges to liquidate any assets that were not being used effectively, “not only for expansion but also for improving quality.”
He argued that most universities around the world are supported by research grants and that Kenyan colleges should follow suit.
Kenyan colleges should take the lead in this direction. “They need to change course” according to the Treasury Secretary.
But Experts argue that the idea of freezing state funding for public universities is not in the best interests of the country.
The country has invested in the establishment of these public institutions, and it is in the country’s best interests that those who go through them succeed.
Public universities are considered state property and should be treated as such.
People who work in universities are hired by the government, university councils are government representatives, and their salaries are paid by the government.
Universities are run with public funds, and the most important thing is to ensure that the institutions return value to the taxpayers.
This will be accomplished by ensuring that scholars are given the opportunity to contribute to the nation’s agenda without interference.
One of the risks of universities funding themselves is that they may settle for programs that spend less on training while reaping more.
Expensive programs such as dentistry, medicine, and veterinary medicine will be axed.
It will also be disastrous for students from low-income families who have little or no financial means to support their education.
The calls for universities to generate their own revenue, on the other hand, are long overdue, but they should not come at the expense of state funding.
If we look into some factors, we can see that the two can coexist.
First, the government should create a better module for funding students by strictly adhering to cost-of-running-an-academic-program recommendations.
The University Act, for example, requires institutions to develop different pay scales for different courses.
However, that has yet to happen because we are linked with the SRC, which issues advisories that are contrary to or contradict the course requirements.
Second, the fees charged are significantly lower than market rates. The fee is fixed at Sh16,000, and we are not permitted to raise it.
We must investigate university governance.
Structures that duplicate and overlap may need to be removed.
As a result, we must examine all faculties, institutes, and departments to determine what they require and do not require, as well as the value proposition they bring to the table.
“We have to look at the institution we have and reflect on how to make it more efficient, more accountable.” Says the University of Nairobi Vice-Chancellor.