Public universities could soon lose access to scholarships altogether under a new government proposal to fund every qualifying student entirely through loans repayable after graduation.
The Tertiary Education Placement and Funding Bill, now before Parliament, seeks to bring all higher education financing under a single authority, replacing the current arrangement in which some students receive scholarships while others get a blend of scholarships and loans based on financial need.
Under the new proposal, students placed in public universities would receive up to 100 per cent funding, but the entire amount would be treated as a loan, to be repaid once the beneficiary secures employment.
President William Ruto outlined the thinking behind the model at a State House event in July.
“Going forward, any student who has passed and is placed in a college or university, each of them will get full funding for their education. It will not matter the background of any child in Kenya, but how good they are,” he said.
The Bill proposes consolidating the Higher Education Loans Board (Helb), the Universities Fund and TVET Funding Board into a single institution, the Tertiary Education Funding Authority (TEFA), which would take charge of all student loans, scholarships and institutional funding going forward.
Education Cabinet Secretary Julius Ogamba has described the plan as a way of drawing together previously separate funding streams into one sustainable financing model, adding that the authority would be empowered to explore non-traditional funding resources.
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“The funding authority will have the power to utilise non-traditional resource mobilisation mechanisms such as education bonds and capital markets to ensure that there are adequate resources to support students,” he said.
Helb CEO Geoffrey Monari said the new model would also include a savings component for families. “We will have a bond system which will be raised through the capital markets. We will have a savings scheme where the parents can save funds for their students when they go to the university,” he said.
On repayment, graduates who secure formal employment will be required to disclose their loan status to their employers as soon as they are hired, allowing repayments to be deducted directly from their salaries. Those in informal employment will instead be required to enter into individual repayment agreements, setting out how and when they intend to repay what they owe.
To protect borrowers from excessive deductions, the proposed law caps repayments at no more than 25 per cent of a beneficiary’s earnings. The authority would also have powers to recover unpaid amounts as civil debts, giving it legal grounds to pursue defaulters.
The Bill has already been tabled before the National Assembly’s Departmental Committee on Education and will next proceed to full debate in the House, where MPs will decide whether to approve the new funding model.
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