Reduced budget puts damper on student funding plans

Plans by Kenya’s Higher Education Loans Board, or HELB, to implement the differentiated unit cost funding model biased towards science and technology programmes and introduce loans to students abroad seem destined to falter after the government moved to reduce the budget allocation to the board by US$90 million for the upcoming 2017-18 financial year.

The higher education student financier had requested a total of US$190 million from the national treasury for the year beginning July 2017. However, the latest proposals for the 2017-18 budget released in the second week of this month show that HELB has been allocated a US$100 million budget, slightly higher than the US$91 million it received in the 2016-17 financial year.

This is despite a 2016 World Bank report, Expanding Tertiary Education for Well-paid Jobs: Competitiveness and shared prosperity in Kenya, which anticipates that the number of students requiring government loans will grow by between 30,000 and 35,000 each year between 2014 and 2022 and calls for a sustained enhancement in allocations to the Higher Education Loans Board.

Differentiated unit cost model

The new differentiated unit cost funding model is intended to provide enhanced loans to learners based on the actual cost of a programme. It would have seen those taking science, technology, engineering and maths or STEM-related programmes receive higher funding compared to their counterparts enrolled in arts programmes, a development policy-makers anticipated would incentivise more students to enrol in the former courses.

It would also have seen universities with a heavy bias towards STEM courses get enhanced funding, a dream come true for university heads who have been calling for adoption of the differentiated unit cost model.

Besides helping to operationalise the new funding model, the loans body had hoped the increased budget would assist in extending loans for the first time to nearly 10,000 Kenyan students studying abroad, beginning in the final quarter of this year.

Student complaints

Plans to commence funding foreign-based students (outside of East Africa) was mooted late last year after a directive by President Uhuru Kenyatta who was responding to complaints by Kenyan students enrolled in Indian universities that funding only local and East Africa-based students amounted to a form of discrimination.

Since the beginning of the year the Higher Education Loans Board has been crafting a policy that would guide the actualisation of the presidential directive on overseas learners, a policy even if crafted on time would have to be shelved – at least for now.

The board currently supports nearly 200,000 students within the country and about 1,500 enrolled in universities within the East African region, as well as those studying in middle level colleges locally.

While those enrolled in local universities get an annual loan of US$1,200 a year, those in regional universities receive US$500, arguably because they are studying in institutions deemed to be relatively cheaper compared to those at home.

The reduced allocation to the loans board is a blow for Education, Science and Technology Cabinet Secretary Dr Fred Matiang’i who said in January that he had impressed on the government the need for an increased allocation to HELB on the basis that the adoption of the differentiated unit cost model and course-based funding would help the country narrow the skills gap in STEM for the broader purposes of economic development.

Science bias

“I’m telling my colleagues at the Higher Education Loans Board that we are done for this year but for the coming financial year when we prepare for funds, I will request the cabinet that I get a deliberate bias towards science and technology-based training allocations so that we can move this country forward and to the next level,” the cabinet secretary was quoted as saying in local media.

Matiang'i had anticipated that the enhanced financing would commence this July, a move he had predicted would eventually reverse the current situation in which 80% of students are enrolled in arts programmes.

The budget proposals unveiled by the Finance Ministry will be reviewed by the National Assembly’s budget committee between March and May this year, when interested parties including government departments can present their views.

However, it is not until June when the document is tabled before the entire sitting of parliament for approval that the proposals will be debated and possible amendments be made.

Once the estimates are adopted, the recourse for departments not satisfied with allocations is through a plea for the drafting of a supplementary budget.