The Ministry of Education has admitted that years of delayed and inadequate disbursement of capitation funds have severely strained universities, Technical and Vocational Education and Training (TVET) institutions and teacher training colleges, forcing many institutions into financial distress, stalling infrastructure projects and contributing to declining student enrollment.
Appearing before the National Assembly’s Public Investments Committee on Governance and Education (PIC-G&E), Education Cabinet Secretary Julius Migos Ogamba acknowledged that persistent funding shortfalls have remained the biggest challenge facing tertiary education, even as he assured MPs that sweeping legal and policy reforms are being rolled out to address the long-standing crisis.
The CS, accompanied by Higher Education Principal Secretary Dr Beatrice Inyangala, TVET Principal Secretary Dr Esther Thaara Muoria, Universities Fund Acting Chief Executive Officer Dr Edwin Wanyonyi and Higher Education Loans Board (HELB) Chief Executive Geoffrey Monari, was responding to Auditor-General’s reports covering the 2018/19 to 2024/25 financial years.
The audit reports had flagged persistent delays in capitation disbursement, stalled projects, weak financial management, declining enrolment in TVET institutions, unaccounted equipment supplied to colleges and growing financial instability across universities.
Committee members painted a grim picture of institutions grappling with shrinking student numbers, unpaid bills, stalled construction projects and mounting audit queries.
Kilome MP Thaddeus Nzambia said enrolment in several TVET institutions had dropped dramatically, with some colleges falling from about 800 students to barely 300, while others had declined from more than 700 learners to about 200.
“The principals consistently point to delayed capitation as the major reason students are dropping out. This was a good programme meant to equip young people with technical skills, but the current trend is worrying,” he said.
Embakasi West MP Mark Mwenje questioned why institutions continued to report funding shortages despite government assurances that capitation had been disbursed.
He also raised concerns over a Ksh 28 billion funding gap in universities, saying many students were increasingly relying on Constituency Development Fund bursaries and HELB loans to remain in school.
“Students are under immense pressure, especially when examinations approach. Universities require predictable funding instead of leaving students to depend on bursaries that cannot adequately meet tuition costs,” he said.
Responding to the concerns, Mr Ogamba admitted that the ministry has consistently received less money than it budgets for, resulting in annual funding deficits.
Using TVET allocations as an example, he said although institutions were budgeted to receive billions of shillings annually, the Exchequer frequently released substantially lower amounts, leaving institutions unable to meet operational costs.
“The challenge has been that whatever amount we request because of financial constraints, we do not receive the full allocation. That creates annual deficits, except in the 2025/26 financial year where TVET capitation was fully disbursed as budgeted,” said the CS.
He said the government was addressing the structural funding problem through the proposed Tertiary Education Funding Bill, 2025, which seeks to establish a more sustainable financing framework by consolidating various education funding streams into a single pool for equitable distribution.
“We are preparing legislation that will fundamentally reform tertiary education financing. We want a system where all available education funds are pooled together and distributed efficiently to support learners and institutions sustainably,” he said.
Mr Ogamba said the government was also expanding the student-centred funding model under which financial support follows the learner rather than institutions.
The CS acknowledged that many students eligible for government scholarships and loans were failing to benefit because they were unaware of the application process.
To bridge that gap, he said the ministry had deployed sensitisation teams across the country and stationed officers at Huduma Centres to help students apply for scholarships and HELB support.
“Every student admitted to our tertiary institutions is entitled to government support. The problem is that many do not know how to apply, and we are intensifying public awareness,” he said.
The committee also expressed concern over the growing number of stalled infrastructure projects in universities and TVET institutions.
Lunga Lunga MP Chiforomodo Mangale Munga questioned why institutions continued launching new projects while older ones remained incomplete despite consuming billions of shillings.
Kasipul MP Boyd Were cited Jaramogi Oginga Odinga University, where several projects worth more than Sh3 billion had stalled for years, raising questions over value for money.
Committee chairman Dick Maungu urged the ministry to enforce stricter controls to ensure institutions completed ongoing projects before initiating new ones.
In response, Mr Ogamba said the ministry had already adopted a policy prohibiting institutions from commencing new development projects before completing existing ones.
He disclosed that ongoing audits had identified projects nearing completion, which would be prioritised for funding to maximise returns on investments already made.
“We have made it a policy that no new projects should commence before existing ones are completed. Universities have been directed to prioritise projects that are 85 or 95 per cent complete before embarking on new developments,” he said.
He added that stalled projects caused by non-performing contractors would be terminated after legal review, with recovery proceedings initiated against contractors who had received public funds without completing works.
The CS cited the stalled Chepararia Technical Training Institute automotive engineering workshop, where Ksh 26 million had already been paid to a contractor, saying legal processes were underway to terminate the contract and recover the money.
On the financial health of universities, Mr Ogamba revealed that when the current administration assumed office, 23 public universities were technically insolvent.
He attributed recent improvements to the new funding model, saying the number of financially distressed universities had reduced to 11.
“We found 23 universities in the red. Through reforms and timely funding, we have reduced that number to 11, and we are working towards restoring all universities to financial stability,” he said.
The ministry, he added, had directed universities to audit their assets and liabilities with a view to commercialising idle land and other assets to generate additional revenue.
Mr Ogamba encouraged universities and TVET institutions to embrace income-generating ventures instead of relying exclusively on government funding.
He said several institutions had already begun commercialising training facilities by partnering with industries.
He cited Rift Valley Technical Training Institute and Kabete National Polytechnic, where students were participating in production work through partnerships with industry, including manufacturing windows and doors for the government’s Affordable Housing Programme.
“We want our workshops to become production centres where students gain practical experience while institutions generate income to supplement government funding,” he said.
The committee also raised concerns over expensive training equipment lying idle in some institutions while others lacked similar facilities.
Chairman Dick Maungu said the committee had discovered colleges storing hundreds of unused sewing machines while neighbouring institutions struggled with acute equipment shortages.
The Auditor-General’s reports further questioned why millions of shillings worth of government-supplied equipment had not been captured in institutional asset registers.
Mr Ogamba admitted weaknesses in documentation and said the ministry had initiated a nationwide audit of all TVET equipment.
The exercise, he said, would establish the value of equipment supplied, ensure institutions formally register the assets and facilitate redistribution of underutilised equipment to colleges where demand exists.
“We need to rationalise these assets. Public equipment should serve students wherever the need exists rather than remain locked away in stores,” he said.
Members also questioned deductions made by TVET institutions to the Kenya Association of Technical Training Institutions (KATTI), which auditors had described as irregular.
The CS said although KATTI was legally registered, the ministry was considering bringing its financial audits under the Office of the Auditor-General to enhance transparency and accountability.
On concerns over declining TVET enrolment, Mr Ogamba linked the trend partly to funding challenges but expressed confidence that reforms, expanded scholarships, modular training programmes and stronger industry partnerships would reverse the decline.
The Committee also sought clarification on reports that government had reduced capitation for senior schools from Ksh 22,244 to Ksh 14,000 per learner.
Mr Ogamba dismissed the claims, maintaining that government policy had not changed.
“The capitation for senior schools remains Ksh 22,244 per student. It has not been reduced to Ksh 14,000. Our objective is to progressively ensure institutions receive the full amount provided for under government policy,” he said.
