Public universities will be allocated money based on course completion rates, community service and gender considerations as the government moves to implement the performance-based funding model.
The Universities Funding Board (UFB) has set key performance indicators for the institutions of higher learning, including research outputs, number of industrial attachments facilitated by the universities and female students enrolled in science, technology, engineering and mathematics (STEM) courses.
It will also consider the number of joint programmes with industry, commerce and civil society organisations in each year as well as graduate employability rate, a year after graduation.
“The UFB is establishing a performance-based funding mechanism to reward universities for efficiency in teaching, research and community service and encourages competition among universities which will stimulate the evolution of centres of excellence,” Geoffrey Monari, the chief executive officer of the UFB, said.
Government funding to universities is currently based on students’ enrolment numbers and the courses they take.
Recurrent funding to public universities is based on the differentiated unit cost (DUC) formula introduced in 2017, which groups academic programmes into 14 clusters, each with a fixed cost.
Under the DUC model, the government is expected to cater to 80 percent of the unit cost while the remaining 20 percent is borne by students and institutions. A cash crunch has, however, seen allotments by the State fall way behind at about 53 percent.
“We are currently funding at 53.77 percent for public universities, compared to the 60.7 percent the previous year and the 66.4 percent we did in the year to June 2018,” Mr Monari told the Business Daily in a previous interview.
This reduction in government capitation has resulted in huge payroll gaps and accumulation of debts, putting the institutions’ financial sustainability at risk.
Data from the UFB shows public universities’ debt hit Sh56.6 billion by April 2021, a big chunk of which is linked to unremitted statutory deductions that have accumulated penalties.
The public universities have outstanding remittances to the Kenya Revenue Authority, the National Hospital Insurance Fund, the National Social Security Fund, pension schemes, insurance companies, and saccos.
Cash flow challenges for universities have been made worse by the sharp decline in students enrolling for the parallel or self-sponsored degree programmes over the past four years that in the past generated billions of shillings for the institutions.
Kenyan universities are grappling with 38,973 unfilled slots as students failed to take up their admission offers, dealing a blow to the institutions’ already falling revenues.
Data from the Kenya Universities and Colleges Central Placement Service (KUCCPS) shows that the 69 public and private universities admitted 128,073 students against available space for 167,046.
This means that 76.6 percent of available capacity in universities has been filled for this year, a drop from 84.6 percent in 2020 when the institutions were left with 22,298 unfilled places.
The number of students who scored C+ and above in the Kenya Certificate of Secondary Education (KCSE) exam that opted to join technical and vocational education and training institutions (TVETs) increased 40 percent, an indication that technical courses are gaining popularity.
“In the 2020 KCSE, 6,617 students who attained C+ and above chose TVET programmes and were placed, up from 2,632 in 2019,” Education Cabinet Secretary George Magoha said during the release of the 2020 universities and colleges placement results.
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