The funding gap for students in public universities has doubled in the past two years, signalling even tougher days ahead for the cash-strapped institutions.
The data from the Universities Fund UF shows that the gap has hit Sh 27 billion in the current financial year, a 107.7 percent jump from Sh 13 billion two years ago.
Capitation per student declined by up to Sh 35,616 per student in the period, raising fears that more universities may follow the University of Nairobi in raising tuition and accommodation fees to fill the gaps.
The average allocation per student fell to Sh 135,244. 63 were in the period from June last year.
Vice-chancellors have pushed the government to increase fees nearly three times in a bid to ease the cash flow woes that have bedeviling the institutions since last year.
The Fund says that universities in Kenya are in a serious financial crisis because of the decline in government funding as well as the increased cost of administering education.
The data shows that the allocation in the current financial year will cater for 49.51 percent of the tuition cost per student, compared to the required 80 percent. The universities and students pay the rest of the costs.
The funding deficit has doubled in the past two years, exposing universities already hit by the reduced enrollment of self-sponsored students.
Last year, the State Department for Higher Education backed plans by vice-chancellors to increase fees, saying it will help keep the institutions afloat.
In our very simplistic way, we thought it was necessary to increase the contribution by individual students, so that funding is adequate for every university, Higher Education Principal Secretary Simon Nabukwesi told MPs last year.
The University of Nairobi in September doubled fees for postgraduate courses and parallel degrees to help with a cash crunch brought home by a dip in student enrollment.
The increment was effected for first-year undergraduate and postgraduate students who reported that month.
The institution increased accommodation fees by up to seven times per semester, with those in third and final years paying Sh 21,525 per semester, up from Sh 3,150, while those in rooms shared by four will pay Sh 15,120, up from Sh 2,730.
Fresh students who reported in September will get Sh 19, 635 for a room shared by two students per semester, up from the Sh 2,835 under the revised rates that took effect two months ago.
Student capitation has been falling for the past two years due to increases in enrollment that have outpaced the stagnant budget allocations.
The number of students eligible to participate in the capitation is 324,182 in the current financial year, a 34 percent increase from 241,015 two years ago.
In the same period, budget allocation for the capitation has increased by six percent to 43.84 billion in the current financial year from 41.18 billion in 2019.
The Treasury has been cutting allocation to universities in recent years because of the constant revenue shortfalls and debt payment obligations that have put pressure on the Exchequer.
Universities have shut down several campuses and defaulted on statutory obligations and payments to contractors.
The UF has sent a draft funding formula to the Treasury that will replace the current criteria that has been used since 2017.
The proposed funding formula is pegged on performance indicators that include absorption of the institution's graduates in the job market, research and training on financial management for top officials.
Since the 2017-18 financial year, the formula has been used to allocate funds to government-sponsored students in public and private universities.
The higher education sector has been struggling with financial challenges that have been made worse by the Covid-19 Pandemic.
According to a report by Parliament, universities are struggling to honour obligations such as payroll taxes, retirement benefits, insurance premiums for employees and payment for contractors and suppliers.
They have outstanding remittances to the Kenya Revenue Authority, the National Hospital Insurance Fund, the National Social Security Fund, pension schemes, insurance companies and SACCOs.
The debt hit a new low of 60 billion in the year ended June, prompting calls from the UF for emergency measures by the State to prevent further increases.
There is a need for an audit to determine the extent of debts in the universities and provide a roadmap on how to clear them. In order to prevent the accumulation of more arrears, measures are needed, according to UF chief executive Geoffrey Monari.
The World Bank has called for the merging of the cash-strapped public universities and the need to cut spending, and there is a push to review the formula.
Kenya has 102 public universities and campuses that posted a deficit of 6.2 billion in the year to June and received nearly 70 billion from the Treasury to run their operations.
Egerton University closed its main campus in Njoro last week after a financial crisis that caused a go-slow by lecturers and non-teaching staff.
Moi, Laikipia, Moi, and Jomo Kenyatta University of Agriculture and TechnologyKenyatta University of Agriculture and Technology shut down some of their campuses in the wake of the cash crisis.