The National Treasury has backed proposals by vice chancellors to triple university fees to keep the institutions afloat.
National Treasury Principal Secretary Julius Muia told Parliament reviewing fees is part of policy options to ensure financial sustainability in universities.
The vice chancellors propose that tuition fees be increased to Sh48,000 from the current Sh16,000 for fresh students to ease cash flow challenges that have affected service delivery.
“Our suggestion is that we increase tuition fee to Sh48,000, then raise bursary allocation for those students not able to raise that amount,” Mr Muia told the National Assembly Committee on Education.
Tripling the fees will mark the first major shake-up of university fees since the end of free university education in 1991 and introduction of the student’s loans scheme-Higher Education Loans Board (Helb)- in 1995.
The push for review of the fees comes at a time universities are experiencing a sharp fall in the number self-sponsored students due to a drop in number of students scoring the mandatory C+ grade in KCSE.
This has resulted to cash flow challenges, forcing the institutions to freeze hirings and slow down expansion plans as they are weighed down by huge debts.
Data from the Ministry of Education shows the institutions are struggling to honour obligations such as payroll taxes, retirement benefits and insurance premiums for employees.
The universities have failed to remit employee dues amounting to Sh34 billion, underlining the deepening cash flow crisis.
In 2017, government funding to universities shifted to the Differentiated Unit Cost (DUC) model that pegged allocation of budgets on number of undergraduate students registered and courses they take.
Before the DUC, each academic programme was allocated a flat rate of Sh120,000 per year per student.
With the DUC, the plan is to have government contribute 80 per cent funding per student, while the institutions and student cater for the remaining 20 per cent equitably.