Thousands in HE funding quagmire as new model rolls out

Ahead of the start of a new academic year, about 10,000 Kenyan students find themselves navigating turbulent waters following their appeals for funding reclassification under the country’s new student-centred university funding model.

This situation is unfolding against a backdrop of broader challenges facing Kenya’s higher education sector, including a looming strike, budget deficits within universities, and growing anxiety over the financial distress threatening institutions of higher learning.

The appeals process, triggered by students who argue they were placed in the incorrect financial aid bands, has exposed potential flaws in the initial classification system. This comes at a time when the government has already made a significant investment, with US$55.7 million disbursed in loans and scholarships to support university students across the country.

Geoffrey Monari, CEO of the Universities Fund, which allocates bursaries and scholarships to students, spoke about the scale of the situation: “Out of 134,029 students who applied for financial aid, 127,591 applications have already been categorised into various financial bands.

“We have already processed over 127,000 loan and scholarship awards and are in the process of evaluating the appeals. As of last week, over 10,000 appeals have been processed.”

This banding system has sparked controversy, with critics arguing that it fails to account for the nuanced variations in family finances. A higher education expert, who asked to remain anonymous, faulting the system said: “The fact that nearly one in 10 applicants feels misclassified is deeply concerning. It indicates that the metrics used to assess financial need may not be capturing the full picture of a family’s economic situation.”

How the bands work

Students in Band 1, coming from families earning less than US$41.7 monthly, receive the most substantial aid. They are eligible for 70% of their costs covered by government scholarships, 25% through loans, and an additional US$417 upkeep loan.

Band 2 students see a slight reduction in support, with 60% scholarship coverage, 30% loans, a US$382 upkeep loan, and a 10% family contribution.

For those in Band 3, the government scholarship covers half of the costs, with 30% in loans, a US$348 upkeep loan, and families contributing 20%.

Band 4 students receive 40% in scholarships and 30% in loans, with families expected to contribute the remaining 30%. Finally, Band 5 students, considered the most financially capable, with family incomes above US$835 per month, receive equal portions of 30% in scholarships and loans, with families responsible for the largest share at 40% of the total costs.

Misclassification claims

Kenya’s Ministry of Education has broken down the initial placements, revealing that 36,947 students were placed in Band 3, followed by 28,280 in Band 4, 26,920 in Band 2, and 21,840 in Band 1.

Fewer than 10,000 were placed in Band 5, while 10,814 were categorised as self-sponsored.

Of the US$55.7 million disbursed, US$36.2 million has been allocated to the Higher Education Loans Board, or HELB, for tuition and upkeep loans, while US$19.5 million has been directed to the Universities Fund for scholarships.

The situation has placed significant financial strain on students and their families. Sarah Muthoni, a 19-year-old prospective student, shares her dilemma: “I was placed in Band 4, which means my family is expected to contribute 30% of my fees. But we can barely afford three meals a day. How are we supposed to come up with thousands of dollars for my education?”

Some students, like 20-year-old James Ochieng, have made the difficult decision to defer their enrolment. “I can’t risk attending classes without knowing if I’ll be able to pay. It’s heartbreaking, but I have to wait and see if my appeal is successful,” he said.

The uncertainty extends beyond, to students’ families. Mary Mwende, a single mother of three, shares her concerns: “If my son’s appeal is denied, I don’t know how we’ll manage. I might have to sell our only piece of land, but even that won’t be enough.”

Verification process implemented

In response to these concerns, the Ministry of Education has deployed over 100,000 officers from the National Government Administration Office to verify applicant information.

While this move has been welcomed by many, others question why such extensive verification wasn’t part of the initial classification process.

President William Ruto has reiterated the government’s commitment to ensuring that all students are admitted to institutions of higher learning, regardless of their financial backgrounds.

Speaking at the conclusion of his three-day tour of the Gusii region two weeks ago, Ruto expressed confidence that a US$638 million government allocation to fund scholarships, grants and loans for students would be sufficient.

“We have increased the money available for our higher education from US$350 million to US$638 million. The letters that were issued by universities are misleading because they were talking about the cost of the courses. We want those letters to be withdrawn and proper letters issued,” Ruto said.

A funding gap remains

However, despite the president’s assurances, a significant funding gap remains unaddressed.

The ministry requires at least US$1.01 billion for this financial year to cover scholarships, grants and loans. A recent report tabled in parliament detailed a deficit of up to US$374 million needed for the three higher education funding policies.

The report indicates that, of the US$101 million required for scholarships, the allocated US$33.4 million can only support 32% of the new students expected to join universities, leaving 73,793 students in financial limbo.

For continuing students, the Higher Education Loans Board is grappling with a US$13.2 million deficit, potentially leaving 61,052 students without funding in the 2024-25 financial year.

Adding to the sector’s challenges, the Universities’ Academic Staff Union (UASU) had issued a strike notice which lapsed on August 21 to protest salary delays, incomplete payments and concerns over the new funding model.

UASU, representing between 10,000 and 12,000 academic staff members across the country, threatened to halt learning in all public universities starting in September.

This potential strike poses a significant threat to the academic calendar and the overall stability of the higher education sector.

President commits to support all HE students

Despite these glaring gaps and challenges, Ruto expressed confidence in the government’s ability to support all students in higher education institutions.

“We want to ensure that every child in Kenya has access to education, and I want to assure parents that no child in Kenya will be locked out of education because of their parents’ [financial] ability.

“We will make sure all students have a chance to access higher education in our universities and in our TVETs [technical and vocational education and training institutions],” he said.

However, the president did not address plans to cover a US$374 million shortfall in the system, which could potentially exclude about 70,000 new students from accessing scholarships. This is despite an additional US$241 million allocation to the Higher Education Loans Board that the government recently approved.

In the recently ratified Supplementary Appropriation Bill, it remains to be seen how the government will manage the growing anxiety over the financial distress looming over institutions of higher learning.

Despite the funding turmoil, a total of 153,274 prospective students have been placed by the Kenya Universities and Colleges Central Placement Service in various degree levels for the 2024-25 academic year.