The National Treasury has announced that it will not pay Sh64 billion in unremitted capitation funds to public schools, citing the government’s cash-based budgeting system, which does not allow funds to be carried forward from previous financial years.
Cabinet Secretary for the National Treasury, John Mbadi, clarified that funds allocated but not disbursed within a financial year cannot be paid later.
“It was budgeted for, but our budget is cash-based. If a financial year has ended and you didn’t pay it, there’s no money to pay later!” Mbadi stated during an interview with Spice FM on Thursday.
He further emphasized that the government does not hold unspent funds in reserve, questioning, “Who do we pay that money to if the capitation was not released?”
Schools Face Financial Strain Due to Funding Gaps
Headteachers of public primary and secondary schools have been urging the government to clear the arrears, arguing that the funding shortfall has led to severe operational challenges. Many institutions have accumulated debts and are facing lawsuits from suppliers.
The delay and reduction in capitation funds have also impacted several key areas, including:
- Learning materials – Schools are struggling to provide adequate books and resources.
- Non-teaching staff salaries – Many schools are unable to pay their support staff on time.
- School meals – The financial strain has affected the feeding programs in some institutions.
- Co-curricular activities – Schools have had to cut back on sports and extracurricular programs due to a lack of funds.
Capitation Rates and Funding Shortfalls
Under the Free Primary Education (FPE) program, the government allocates Sh1,420 per learner annually, while junior school learners receive Sh15,042 per year. The Free Day Secondary Education (FDSE) program initially provided Sh22,244 per student per year, but this amount has been reduced to approximately Sh15,000.
School Fees Adjustments and Government Commitments
Mbadi acknowledged that when government capitation is delayed or reduced, school administrators sometimes increase fees beyond the recommended levels to cover the deficit.
“If parents were forced to pay (to cover the shortfall), and then we give schools that money later, will they refund the parents? Moving forward, we must ensure all budgeted funds are released on time,” he stated.
The CS also confirmed that funds for the first term have been disbursed to primary and junior secondary schools, while secondary schools still face a Sh14 billion shortfall, which he assured would be settled before the term ends.
In addition, he highlighted the financial needs of public universities, stating that they require Sh107 billion annually to operate effectively.
“We had Sh48.8 billion to pay capitation to schools. Out of this:
- Sh4.5 billion was allocated for Free Primary Education and has been fully paid.
- Sh15.1 billion was allocated for Junior Secondary School and has also been fully paid.
- Sh20 billion was allocated for secondary schools, of which Sh14 billion has been paid so far. The remaining balance will be settled before the term ends.”**
Push for Higher School Fees
Amid the financial constraints, secondary school principals have proposed an increase in school fees to cushion institutions from the funding gaps. The Kenya Secondary Schools Heads Association (KESSHA) argues that the capitation rates, last reviewed in 2018, have been gradually reduced and no longer account for inflation.
In their proposal to the Ministry of Education, KESSHA recommends:
- Parents with children in national schools pay an additional Sh19,628 annually.
- Parents with children in extra-county schools pay an additional Sh27,488 annually.
- Day school students, who currently receive free tuition, should now pay Sh5,372 per year.
As financial pressures mount, school administrators and policymakers continue to debate sustainable solutions to ensure quality education without overburdening parents.