Moi University Council addresses financial crisis, outlines plans for recovery

In a comprehensive statement, the Council explained that the challenges currently facing the university are the result of long-standing financial difficulties, which have been exacerbated by reduced government funding and a significant decline in student enrollment. 

he Council emphasized that these issues could not be resolved immediately, but they are engaged in ongoing consultations with key stakeholders to ensure the long-term stability of the institution.

The primary issue facing Moi University, according to the Council, is a severe financial shortfall. The university has struggled to generate enough revenue to cover its operating expenses, including monthly payroll costs.

For the past decade, government funding has steadily decreased, with the introduction of the differentiated unit cost model reducing the government’s contribution from an anticipated 80% of program costs to just 38%.

The gap in funding was initially covered by private student enrollment, but the 2016 education reforms, which eliminated the private sponsorship model, further strained the institution's finances.

Additionally, a significant drop in student enrollment has left the university with excess capacity. For the 2024/2025 academic year, Moi University enrolled only 6,000 first-year students, compared to its declared capacity of over 14,000, further compounding the financial difficulties.

The Council has engaged with government agencies to explore ways of utilizing this excess capacity, with solutions expected to be implemented in the 2025/2026 academic year.

The university's financial struggles have resulted in delays in salary payments and the accumulation of unpaid statutory and third-party deductions. The Council clarified that the delays were not due to mismanagement, but rather because available funds were insufficient to cover the net payroll, leaving no money for deductions.

However, with the recent support from the government, the university has resumed paying staff salaries in full, along with remitting statutory deductions as of September 2024.

The government has pledged financial support amounting to Ksh.3.5 billion to help address the payroll gap and other urgent financial obligations. The Ministry of Education, National Treasury, and other key government bodies have assured the university that the necessary funds will be disbursed to ensure the continuity of operations.

The Council also addressed media reports suggesting that over Ksh.2.2 billion had been squandered in capital development projects. According to the statement, these reports are inaccurate, as the quoted amount represents the total cost of the projects under scrutiny, many of which are still in the planning or funding stages.

Some of these projects are donor-funded, and the university is undergoing external audits to ensure accountability in the use of funds. Investigations into the procurement decisions for these projects are also underway, with the Ethics and Anti-Corruption Commission (EACC) currently reviewing the matter.

Looking to the future, the Council reiterated its commitment to ensuring the financial sustainability of Moi University. The university is exploring strategies to diversify its revenue sources, including expanding research initiatives, forging new partnerships, and exploring other income-generating opportunities. The Council is also working on a long-term plan to reduce the university’s reliance on government funding.

“We are optimistic that with continued government support and by implementing strategic measures, Moi University will emerge stronger and more resilient,” the statement concluded.