At least 95,000 university and college students who depend on government loans could soon cut short their studies due to lack of funding.
The Higher Education Loans Board (Helb) yesterday said it will not be able to finance the learners due budget cuts and shrinking loan recoveries.
Helb CEO Charles Ringera said the board had asked for Sh15.5 billion in this year’s budget but the National Treasury slashed it by Sh2.2 billion. Helb, Mr Ringera added, had failed to recover loans amounting to Sh1 billion.
The development, he said, will see 95,000 students in universities, colleges, and technical and vocational education and training institutes (Tvets) miss out on the loans.
“In total this year, we have lost the about Sh3. 2 billion which we will not get for purposes of funding the students,” he said in Nairobi yesterday during the handover ceremony of Elimu Afya Fund by the United States Agency for International Development (USAid).
Students joining university
The shortfall comes in a year when the number of students set to join institutions of higher learning is set to grow substantially.
On top of the existing beneficiaries, the board will now be required to fund the education of 45,000 more medical students who used to get funding from an American agency.
Mr Ringera said 85,000 beneficiaries have defaulted on loans totalling Sh9.5 billion, with the number growing daily. He expressed concern that many students could drop out, adding, that the board may only be able to fund about 450,000 students in Tvets and universities.
The budget cuts have caused Helb to reduce the average funding per student in universities to Sh38,000, down from the previous Sh45,000 before the pandemic. The CEO said the rate will be maintained. However, the ripple effect of the reduced budgetary allocations will greatly affect new students who are expected to join universities in September.
Tvet students will continue to receive an average loan of Sh40,000 per year but the number of beneficiaries will reduce.
Scholarship scheme
In the 2020 Kenya Certificate of Secondary Education (KCSE) a total of 143,140 candidates scored C+ and above, thereby qualifying to join universities.
Mr Ringera said Helb had targeted to fund 110,000 fresh students at a cost of Sh4.6 billion but the current financial situation has forced them to reduce that number to about 80,000.
USAid handed over 45,000 medical students who were being funded by the US government through the Afya Elimu Fund jointly bankrolled by USAid’s FunzoKenya Project, Helb and the Health ministry to the tune of Sh120 million.
The Afya Elimu Fund was started as a scholarship scheme under the Health ministry in the 2012/2013 fiscal year, offering scholarships to 341 middle-level trainees from marginalised areas in specific medical fields.
It was converted into a loan scheme in the 2013/2014 financial year, targeting 2,200 beneficiaries from marginalised areas and from counties with a high HIV prevalence. As of March 31, 2021, the AEF Fund had supported over 48,188 students with a total of Sh3.06 billion. BY DAILY NATION