HELB Says Ksh210 Billion Required for Scholarships and Loans

A minimum of Ksh210 billion will be required by 2028 to finance universities under the new student-centered model.

The CEO of the Higher Education Loans Board (HELB), Charles Ringera, has stated that the loan component will require at least Sh145 billion, while the scholarship component will require at least Ksh75 billion.

In a recent media briefing addressing university funding, Ringera presented findings from preliminary simulations, indicating a projected financial requirement of Ksh210 billion by 2028 under the proposed model.

According to Ringera, this calculation is based on Ksh145 billion sourced exclusively from loans, while an additional Ksh75 billion is earmarked for scholarships.

Elaborating on the sustainability aspect of the proposed funding approach, Ringera emphasized the necessity of establishing substantial funding sources independent of the Exchequer. Such financial contributors would be instrumental in upholding the viability of the new model.

The CEO’s simulation analysis encompassed a comprehensive evaluation of Form Four candidates’ transition to higher education and the envisaged expansion of Technical and Vocational Education and Training (TVET) institutions.

Ringera urged national planners to grasp the significance of these figures, as they offer insights into the potential framework of the funding model. Acknowledging these insights is essential to initiating a dialogue around the long-term sustainability of the proposed approach.

According to him, in order to accomplish sustainability, they have sought partnership funds from donors, foundations, individual corporate funders, counties, and other stakeholders.

The perfect balance for HELB, according to him, is when the loans are repaid, while the future of the board in terms of expansion is to cease relying on the Exchequer and raise a substantial amount of money to support higher education.

Last year, HELB was allocated Ksh11 billion, recovered approximately Ksh4.8 billion, and disbursed approximately Ksh14.9 billion to at least 800,000 students enrolled in TVET institutions and universities.

This fiscal year, funding for higher education institutions is comprised of Ksh27.6 billion from HELB, Ksh19.6 billion from the Universities Fund, and Ksh4.6 billion from TVET.

The loan component covers tuition, literature, and school supplies for students, as well as housing and a subsistence allowance.

Ringera has reported that there is a growing concern arising in the wake of the COVID-19 pandemic, particularly regarding laptops. He disclosed ongoing conversations with the World Bank concerning the implementation of a device loan initiative.

This initiative comes in response to the prevalent requirement of laptops in admission letters from various educational institutions. Ringera pointed out that laptops have become a crucial necessity in many universities.

The objective is to devise a strategy to address the issue and ensure that students are equipped with laptops as they enter universities.

According to him, the country is moving away from the old funding model established in 1989, which is the source of the Sh16,000 tuition fees universities have been referencing.

The Ksh16,000 component was expected to come from the 20% of the Differentiated Unit Cost (DUC) that households or HELB were expected to contribute, while grants were expected to provide 80%.

Ringera explained that the purpose of the former funding formula was to ensure that everyone received something, regardless of their status as students.

“The new funding formula attempts to promote equity and parity. This was necessary because the DUC and average loan have been decreasing, and with the increase in the number of students, they fell to 48% last year and would have reached 35% this year had we persisted on this path, he explained.

HELB Says Ksh210 Billion Required for Scholarships and Loans