Auditor-general raises red flag over Universities Fund

Kenya’s Ministry of Education is in the spotlight following a revelation by the auditor-general that the ministry appears to be frustrating the Universities Fund, legally tasked with the disbursement of funds to institutions of higher learning in the country.

According to a report, there are doubts about whether the Universities Fund is discharging its role in accordance with the law.

Nancy Gathungu, the auditor-general, in the report faults the state department of education for directly financing universities, contrary to legislation that requires that financial allocations be done through the fund.

Lately, there have been claims within the corridors of higher education that universities get funding directly from the state based on their managements’ capability to lobby for allocations.

But, the Universities Act (2012) established the fund and mandated it to finance universities. Section 53 (3) spells out the functions of the fund.

For instance, it is mandated, in consultation with the cabinet secretary, to develop fair and transparent criteria for the allocation of funds to public universities and on how to issue conditional grants to private universities. The government prescribes to private universities how to use these grants.

The fund is also mandated to mobilise and receive funds from the government, donors and other sources to help it fulfil its core mandate.

In addition, it is expected to reduce differentiated remuneration for academic staff of Kenyan universities based on the disciplines or fields they work in, make it fair and globally competitive and to advise on any matters related to that.

Concern over fund’s functioning

However, Gathungu says in the report: “The fund has only been advising the State Department for University Education on [how] to allocate and disburse to the public universities.”

Gathungu is, therefore, concerned that the fund is not discharging its lawful mandate: “In the circumstances, it has not been possible to confirm whether the fund has been carrying out its mandate required by the Universities Act, 2012.”

In the report, Gathungu says that a review of the records showed that the fund has not been allocating funds to universities as required by the law.

The fund, in its operations, adopted the 2016 Differential Unit Cost (DUC) principles for distribution of funds to universities. This has been deployed since 2017-18 in the allocation of funds to universities.

The DUC operates on the basis of the cost to an institution to teach one academic programme per student per year. DUC lumps specific programmes in terms of their cost into 18 clusters, ranging from the lowest that is KSh144,000 (US$1,260) for humanities and the highest being KSh720,000 for dentistry.

However, universities in the past four years have been advocating for the revision of the DUC to do away with disparity between public and private universities.

A few months back, the top management of universities and researchers called for a merger of three funds, the Universities Fund, National Research Fund and the Technical and Vocational Education Fund, to create a single major pool.

The three funding bodies are provided for in science technology and innovation legislation but the merger is deemed critical in paving the way for enhanced lobbying for more finances and increased allocation for the sector.