State Owes Private Universities Sh48.8 Billion Despite Ending Sponsored Student Placement

The government owes private universities a total of Sh48.8 billion for the education of government-sponsored students previously placed in their institutions.

This debt persists despite the government halting the placement of new students in private universities under its sponsorship programme.

The matter came to light during a consultative meeting between the National Assembly Committee on Education and the Kenya Association of Private Universities (KAPU).

The meeting, chaired by Kasipul Kabondo MP Eve Obara, focused on strengthening the role of private institutions in research, innovation, and financial sustainability.

KAPU, led by Chairperson Rev. Prof. Stephen Ngari and a team of Vice Chancellors, raised concern over the delayed payments. In their presentation, the association urged Parliament to push the government to settle the outstanding amount, which had reached nearly Sh49 billion by June 2024.

“While no new students are being placed under sponsorship, the government still owes our institutions Sh48.8 billion. This affects our ability to operate effectively,” said the KAPU Secretary.

The association also called for the enactment of laws that ensure funds are released concurrently with student placements to prevent institutions from being left with unfunded mandates. They further decried the taxation of tuition fees, saying it negatively affects the quality of education delivery.

“If a university records a surplus, it is reasonable to pay tax. But taxing tuition income, which is used to support learning, weakens the system,” the Secretary added.

KAPU also urged for more funding to support research and innovation, pointing out that delays and inefficiencies in disbursing research funds continue to limit progress. They called for a streamlined legal framework to guide research funding and collaboration.

However, MPs questioned the governance and accountability structures of private universities, particularly regarding student dropouts. In response, the university heads clarified that many students leave without formal notice, making it hard to track them, but assured the committee that cases of deferment are properly managed.

Prof. Ngari wrapped up by challenging the notion that private universities are only profit-oriented. He noted that several private institutions offer more affordable programmes than some public universities, underlining their contribution to national development.