Understanding the New Higher Education Funding Model in Kenya: An In-depth Guide

From equal opportunity to individual needs-based funding, explore the groundbreaking NHEF model in Kenya that is reshaping higher education.

Jul 31, 2023 - 13:34
Understanding the New Higher Education Funding Model in Kenya: An In-depth Guide
Understanding the New Higher Education Funding Model in Kenya: An In-depth Guide

A significant shift in Kenya's higher education funding has occurred with the introduction of the New Higher Education Funding (NHEF) model. This new model, which commenced with the admission of 2022 Kenya Certificate of Secondary Education (KCSE) candidates for the 2023-24 financial year, is aimed at restructuring the higher education student funding model.

Following a presidential directive by President William Ruto on May 3, 2023, the funding model has been redesigned to align better with students' needs and their respective program costs. Let's delve into understanding this funding model and how it works.

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The Fundamentals of the NHEF Model

The NHEF model was conceived to offer equal opportunity to access university education and technical and vocational education and training (TVET) to students from less privileged backgrounds.

The funding allocation under this model is based on four pivotal criteria: the program's choice, household income band, affirmative performance, and government priority areas. An innovative Means Testing Instrument (MTI) is applied to accurately determine students' needs levels, which is constructed upon eight significant variables: parents' background, gender, course type, marginalization, disability, and family size and composition.

In a significant move towards fairness, the new model ensures that students from affluent backgrounds receive more loans than scholarships. In contrast, less financially equipped students will benefit more from scholarships than loans. In essence, the funding has now become student-centered and allocated according to individual needs.

Breaking Down the NHEF Funding Approach

Under the NHEF model, students are classified into four categories based on their economic situation: vulnerable, extremely needy, needy, and less needy. Students in the vulnerable and highly needy categories qualify for 100% government funding, including scholarships and loans. On the other hand, students in the needy and less needy brackets will receive 93% of government funding, shouldering only 7% of the tuition costs.

A significant change to note is that under this model, funding will not be given as block funding to universities and TVETs. Instead, it will be allotted to students directly, combining scholarships, loans, and household contributions on a graduated scale determined scientifically.

Implementing the NHEF Model

Facilitating the execution of the NHEF model, the Kenya Kwanza government has increased funding for university education. For the financial year 2023-24, there is a surge in funding from Sh84.6 billion to Sh54 billion. In contrast, the budgetary allocation for TVETs has risen from Sh5.2 billion to Sh10 billion. This model implementation will not affect continuing students, who will continue to receive funding based on the government's existing model.

Moving Beyond the Differentiated Unit Cost (DUC) Model

Before introducing the NHEF model, universities were funded based on the Differentiated Unit Cost (DUC) model. This model hinged on the number of undergraduate students registered on the regular program and the kinds of courses they undertook. However, due to concerns over inequities in funding, with both rich and poor students receiving the exact amounts, the NHEF model was introduced to level the playing field.

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The New Higher Education Funding model, is a transformative step towards a more equitable education system in Kenya. While challenges may arise during its initial stages of implementation, the benefits it promises in terms of inclusivity and financial aid accessibility make it a compelling solution to higher education funding.

Disclaimer: This article aims to provide a comprehensive understanding of the New Higher Education Funding model in Kenya. It is based on the available information and does not claim to cover all aspects of the model. Readers should seek the most recent updates and guidelines from official sources.


What is the New Higher Education Funding model? 

The NHEF is a new model designed to make higher education funding in Kenya more equitable by considering factors like the student's financial background and course type.

Who benefits most from the NHEF model?

 The model primarily benefits students from less privileged backgrounds, giving them more access to scholarships and less reliance on loans.

What is the Means Testing Instrument (MTI)? 

The MTI is a tool used to determine students' need levels scientifically. It considers the student's background, gender, course type, and family size.

What is the difference between the DUC model and the NHEF model? 

The DUC model based funding on the number of students and course types, while the NHEF model considers factors like a student's economic background and course costs, aiming for a more equitable distribution of funds.

What happens to the current students with the introduction of the NHEF model?

 Existing students will be OK with the introduction of the NHEF model. They will continue to receive funding based on the existing government model. However, for new students commencing their studies from the 2023-24 academic year onwards, the NHEF model will be applicable.

Will the NHEF model impact the tuition fees for university education?

The tuition fees will remain the same under the NHEF model. However, the model changes how the tuition fees are funded. Based on the student's economic situation, the government will fund a certain percentage of the tuition fees, and the remaining portion will be the student's responsibility.

Does the NHEF model apply to both public and private universities?

The NHEF model applies predominantly to public universities and TVETs in Kenya. For students attending private institutions, the funding mechanisms may differ. Students are advised to check with their respective institutions about the specifics.

Is the NHEF model applicable to postgraduate programs?

The NHEF model has been primarily designed for undergraduate programs. However, the Kenya government is studying its effectiveness for potential application to postgraduate programs in the future.

By making university education more accessible to students from all socio-economic backgrounds, the New Higher Education Funding model in Kenya aims to reshape the landscape of higher education and contribute to the country's socio-economic development. This model underscores the commitment of the Kenyan government to uphold the principles of fairness, inclusivity, and equal opportunity in higher education.

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