Higher Education Funding Model: Ultimate Guide

The government has launched the New Higher Education Funding(NHEF) model for both scholarships and loans for students placed by Kenya Universities and Colleges Central Placement Service (KUCCPS).

The NHEF model takes effect with the admission of the 2022 Kenya Certificate of Secondary Education (KCSE) candidates into universities and colleges for the 2023-24 financial year.

The new funding framework seeks to offer students whose households are at the bottom of the pyramid equal opportunity in accessing university education and technical and vocational education and training (TVET).

Funding will be based on four criteria; choice of the programme, household income band, affirmative performance and government priority areas.

A Means Testing Instrument (MTI) will be applied to scientifically determine the need levels of students.

The instrument has eight variables, which have been used over the years and have been strengthened and linked to other databases to boost reliability.

The eight variables include parents’ background, gender, course type, marginalisation, disability as well as family size and composition.

By combining these variables, it is envisaged that the State will be able to determine the needs of the various households and fund them appropriately.

Under the new model, funding will be student-centred and be apportioned according to their levels of need classified into four; vulnerable, extremely needy, needy and less needy.

Higher Education Funding Model

The Model: Variable Scholarship and Loan Funding Based on Means Testing

1. For Universities education, funding will be based on the actual cost of the program with the following sources of funding:
   • Government Scholarship – an average of 61%;
   • Government Loan – an average of 5%;
   • Household contribution – an average of 5%.
2. Student-centred funding for TVET education in the new model:
   • Funding is student-centred;
   • Funding is based on actual cost of the program;
   • Government Scholarship – an average of 58%;
   • Government Loan – an average of 32%;
   • Household contribution – an average of 10%.
3. Distribution of scholarships and loans to distinct categories of TVET students:
   • Vulnerable: Scholarship 80%; Loan 20%; Household
   • Extremely Needy: Scholarship 70%; Loan 30%; Household
   • Needy: Scholarship 50%; Loan 30%; Household 20%.
   • Less Needy: Scholarship 32%; Loan 48%; Household 20%.
4. Criteria for identification of students to be funded
   • Academic performance on KCSE
   • Affirmative action:
     • Marginalized as defined by Commission on Revenue Allocation (CRA);
     • Persons living with
   • Household income bands classified according to the monthly household incomes outlined below;
     • Vulnerable – 0;
     • Extremely Needy – 23,671 per month and below;
     • Needy – 23,672 to Ksh.70,000;
     • Less Needy – 70,001 to Ksh. 200,000.
   • National priority areas for Human Capital Development in the country. The following are some of the current Government national priority areas: Agriculture; Animal Health; Climate Change; Medicine; Environment; Technology; Engineering; Applied Sciences; Nutrition and Dietetics; Blue Economy,
5. Determining Students’ level of need

The Means Testing Instrument (MTI) to scientifically determine students’ level of need assigns varied weights and scores students based on the following eight parameters:

• Parent’s background – orphan, single parents, both parents,
• Gender – male or
• Course type – STEM, Arts, national priority area etc
• Previous school type – private or
• Expenditure on education – siblings in high school/tertiary
• Family size and composition – number of children; polygamous/monogamous; age of
• Marginalisation – students/institutions in marginalized counties
• Disability – any form of

7. Placement and Funding
   • Placement by Kenya Universities and Colleges Central Placement Service (KUCCPS) shall not be linked to funding of students. The Universities Act of 2012 Section 56 part 1 (a) to be emended
   • Admission of government-sponsored students harmonized to start in August/ September for uniformity and alignment to the Government Financial
8. Access to funding by students
   • Actual programme cost shall be disclosed to the student during the application process on the KUCCPS portal;
   • Students will be eligible to apply for financial assistance including Government Scholarships, loans and bursaries upon receiving an admission letter from the respective University/ TVET;
   • All other funding and sponsorships provided by the National Government Constituency Development Fund, County Government and other sponsors to be centrally coordinated to avoid multiple funding of the same
9. Universities to have diversified funding streams
   • Student financing: Scholarships/loans/bursaries;
   • Research funding;
   • Capital Infrastructure Grants;
   • Fee for services such as Consultancy
10. Budget Policy Statement
    • Universities’ vote book budget line to be amended from the current 43 to one line referred to as – University Students Scholarships;
    • University Students Scholarships to be apportioned and disbursed by the Universities Fund as stipulated in the Universities Act,
11. Review of the Model
    • The University funding policy and framework to be reviewed to determine fees for different categories of students: government sponsored, privately sponsored, and, foreign students;
    • Universities will be required to declare and publicise the actual cost of their programmes;
    • No public University shall levy additional charges or raise fees without the approval of the Universities Fund Board;
    • Kenya National Bureau of Statistics (KNBS) to provide input for reviewing the funding model every year.