How Universities loose billions in unremitted dues

How Universities loose billions in unremitted dues


How Universities loose billions in unremitted dues

Our Reporter

The much celebrated reforms albeit belatedly when they were initiated with gusto driven  by the indefatigable immediate former cabinet secretary for Education Fred Matiang’i have not only after six months stalled but are in disarray and facing severe unprecedented headwinds as the current happenings at the ministry will attest.

In the university docket, its total confusion and desperation even as the new cabinet secretary Amina Mohammed and his principal secretary Japheth Michemi wear brave faces.

Back to 2016, efforts to address the endemic rot in public universities had gained traction geared to reversing the deplorable state of university education in Kenya. Details of an earlier workshop held in August 2016 between chancellors of public universities and ministry of Education and State Corporation Advisory Committee officials among others had among many other observations recommended that boardroom conflicts in universities fueled by corruption, tribalism, nepotism, and political interests had reached alarming rates.

The conference also noted the rot had found its way into the courts.  “We cannot continue like this. The numbers of cases are too many and it is shocking that it is generated by top managers of the institution,” lamented SCAC secretary Jane Mugambi.  Other cited conflicts in the universities involved supremacy wars between the vice chancellors and councils, noting that some vice chancellors were fighting the councils because they feared oversight which could discover cases of financial mismanagement.

The current audit report has unmasked how public universities management has failed to remit billions of shillings to various statutory bodies. They make deductions to National Social Security Fund, National Hospital Insurance Fund, Pay As You Earn, bank and Sacco loans but  never remit.

The said money after deduction is instead banked in special accounts created by university administrators. The vice-chancellors and their cronies are signatories to the said accounts and withdrew millions at will.

It is a lucrative business and it is part of these millions the VCs use to bribe various state agencies involved in fighting graft and even buy senior education officials and members of varsity councils to renew contracts.

According to the audit report, ten public universities do not remit dues to PAYE. They are University of Nairobi, Kenyatta University, Maasai Mara University, Rongo University, Egerton University, Technical University of Kenya, Multimedia, Muranga, Kaimosi university andTaita Taveta University.

NHIF is owed dues by Egerton University, Maasai Mara, Technical University, Multimedia and Kaimosi.

Moi and Nairobi universities do not remit to Saccos and banks. Further, Nairobi has not remitted Sh1.35 billion to pension scheme with Jkuat owing Sh1.1 billion.

At a well publicised workshop held at Simba Lodge in Naivasha between April 10-12, 2017 to inaugurate the 21 councils of public universities, the newly appointed councils had been given renewed mandate to interrogate an audit conducted in February 2107 by the Commission of University Education and initiate corrective measures.

Issues that cut across the universities included ensuring that the quality assurance systems were put in place to safeguard academic standards, have in place integrated electronic information management systems in the management of students records with a strong rider to the department of education in the ministry to ensure that no university will hold graduation ceremony if it has not set up the system. The councils were mandated to particularly focus on very critical areas of governance and management of universities, and quality of academic programmes which are really wanting, efficiency in management of student affairs and checks and balances in the financial management of institutions, among others.

The CUE audit report in February 2017, among other issues had revealed widespread mismanagement of funds; declining academic standards and unchecked expansion into new campuses.

Towards the end of the retreat in the form of communiqué, the councils made a commitment to reform financial management systems, improve staff development and to enhance the learning environment in their institutions.

The councils committed to promptly remedy any financial management shortfalls and instill accountability and transparency frameworks and closely monitor progress. They also agreed to prioritise research and innovations by carrying out qualitative analysis on their current status.

These resolutions the councils passed were and still are central to reforming the rot at public universities. The universities vice chancellors, principals of colleges and council members committed to account for every shilling, say that again and again.

In our earlier article commenting on this, we were skeptical and in our prediction which has been vindicated with time, it was a tall order and still remains whether the councils had the means and will to implement those resolution. Without any fear of contradiction, we posed then “how will the councils do this is doubtful as how would the same vice chancellors who have been misappropriating the monies all of a sudden will change tactic and transform themselves into prudent managers.

One needs only to revisit how in the first place the vice chancellors have landed into those positions which have been through lobbying and canvassing through the crudest way. First the council members are stealthily and calculatedly lured into trap by being dished out five cent type favours which most of them accept unreservedly”.

Further, the vice chancellors have perfected the art of deception with the carrot and stick applied at will where council members are given token favours of their kith and kin get employed. The council members are compromised through corrupt activities where their relatives are employed. Besides, council members are given per diem even when they do not attend meetings and the monies deposited into their bank accounts.

Universities by their very nature are not awash with monies and the cash is meant to provide teaching and learning facilities. Worldwide, university jobs are more of a calling for selfless service rather than the grandiose blue chip careers. If perhaps the desire by council members is to make money, the noble unsolicited advice would be for such members to resign and lobby for directorship in the blue chip companies and government parastatals which are soaked in huge budgets.

These resolutions, the councils pledged if implemented, were central to reforming the rot at public universities. The question that propped up then and still now nagging and remains mind boggling to many dons is how the government expects the councils and the same university managers who are responsible for the mess to be the ones to correct the mess.

If the councils by sheer luck would manage to outwit the vice chancellors an unlikely possibility and sneak in these anticipated reforms, the offices of the VCs would be stripped of their opulence and clout and current office holders will find themselves in unfamiliar and unchartered grounds.

A case study, even before the ink dried after the Simba retreat, is when Nairobi University vice chancellor Peter Mbithi went overdrive to ensure the council for the premier university would not see the light of the day.

The council has been kept away courtesy of court orders spiced with hide and seek gimmicks orchestrated by none other than the vice chancellor and the chancellor Vijoo Rattansi. The regulator, CUE in September 2017 at the unveiling of the new chief executive officer of the commission Mwenda Ntaragwi by the chairman of the Commission Chacha Nyaingoti noted that to streamline the financial mess and poor governance at the public universities, “the universities will be required to publish periodic financial statements as part of new rules to improve management of the institutions.

He went further to state that the periodic statements will ensure financial discipline at the universities. He went further to say “the universities have to periodically demonstrate that they are financially sustainable and that there are good governance and human resource management systems in place”. He further disclosed three universities are under scrutiny over financial crisis and poor governance structure. All these remain rhetoric and hot air when one looks at what is happening at the public universities.

A casual glance at what is happening at the public universities; one realises that the situation has gotten from bad to worse ever since Amina and her team set foot in Jogoo House.

Firstly, since the beginning of this year, the public universities have been engaged in the longest ever experienced industrial action in public universities in the country and even after the return to work formula was penned down about a month ago, the situations at the public universities are yet to return to normal.

The well meaning reforms are headed in the opposite direction. One hardly hears any pronouncements from the CS Education or the Commission of University Education except some sporadic disjointed statements here and there uttered when the senior officials in Jogoo House grace the much hyped tree planting sessions and the nano-satellite launch campaigns. Suffice to recall the unsolicited caution and skepticism that welcomed the new team at Jogoo House. The change of guard at the ministry of Education at the beginning of the year elicited skepticism for those who were backing the reforms as had seen in Matiangi spirit of hope and deliverance to those who are progressive but the entry of Amina was received with pomp and celebrations and a great relief for those who were anti reformists and were resisting the reforms.

Our education editorial team threw caution to the wind as it welcomed the new CS in the murky waters in public universities which are infested with dreaded crocodiles and venomous cobras complimented with highly infested cartel who stealthy watches the movements of its prey at the opportune time to strike with vengeance and precision of a drone.

If the events witnessed in the last few months are anything to go by, it is quite apparent that the new CS will face a real test in her ministerial career as she navigates through the murky and shark infested ministry.

The many stakeholders in the education sector are fast losing patience which some sections of the media having started a narrative that the cartels are back in the corridors of the Jogoo House lobbying for the reversal of the reforms which have rendered many reeling in poverty as their ill gotten cash has been dwindling with the running dry of the corruption taps.

Many had hoped that the CS would appraise on how the University of Nairobi is being run singlehandedly by one man without any shade of decorum or common decency and come to their rescue, lamented a suffering don yet to receive his salary for the last three months.

The staff are frustrated that the CS and the PS have been compromised by Mbithi so soon and so easily. Many wonder loudly why the CS and PS have allowed Mbithi to straddle university singlehandedly and without a council.

Many dons consider irresponsible for the part of the government to watch as public universities are plundered to insolvency analogous to the current woes on corruption that has reared its ugly head. The public universities through their mismanagement of public resources, sheer arrogance and opulence, they have exhibited as they plundered the institutions resources, the managers through their spokesman Francis Aduol, vice chancellor of Kenya Technical University  on the sidelines of the just ended staff strike owned  up eloquently to  the bitter fact that  public universities are insolvent,  a fact Prof  Mbithi, consistently denied in paid choreographed colourful advertisements in  both print and electronic media.

Amina set up an audit team comprising of the Auditor General including ministry of Education and the National Treasury and Commission for University Education staff to take audit of staff in public universities to re-evaluate how the universities implemented the 2013-2017 CBA arrears after the unions, though all these time, they have been silent and accomplice in fraudulently embezzling the monies given by government to pay to staff. The teams report is yet to be heard of.

Back to the collapsed reforms, the media this week reported some staff of public universities going to court challenging the re-appointments of vice chancellors among them Technical University of Kenya, Jaramogi Oginga Odinga, Kabianga and Masai universities for a second term.  The bone of contention is that the appointees were not subjected to competition as is required.

The appellant further claims that some of those that were reappointed to the councils had recommended them fired.  In as many weeks, we had reported on trepidation, fear and panic that had gripped public universities, the premier university included, after awakening to reality that the contracts of many vice chancellors and chancellors have ended or are ending in the coming months.

The term of vice chancellorship of Prof Aduol ended while he was the chair of the amorphous Vice Chancellors Committee and was taking part in the negotiations with the government and union on the 2017-2021 CBA.

There was high level canvassing and lobbying enlisted to impress upon the powers that are to have Aduol get a second term on the pretext that his exit would be “detrimental” to the negotiations between the dons and the government.

Aduol just like Mbithi had brought down the Technical University of Kenya to its knees in a record time of three years. He was first appointed principal of the Technical University of Kenya in 2008 when it was elevated from being Kenya Polytechnic to the constituent college of the University of Nairobi.

Subsequently, he became the vice chancellor after the college attained its charter and became a fully fledged university. When Aduol took over the college, the college had surplus money running into millions of shillings due to the prudent management and good leadership of the then Principal.

Soon after Aduol took over, he cleaned the coffers through uncontrolled expenditure and extravagance and today, Technical University of Kenya just like its mentor, the University of Nairobi, is insolvent and unable to pay staff salaries and remit statutory staff deductions.

It behooves Amina to tell Kenyans what qualities he saw in Aduol that compelled her to reappoint Aduol for another five years? The reappointment go a long way to vindicate the skeptics that indeed, the much talked of reforms exist on paper but in real sense, they are doomed based on the reappointments of the same faces who have brought down the same institutions.

The action of reappointing vice chancellors whose first tenure have been controversial with abuse of office scandals, poor governance leading to insolvency of the institutions does not only de-motivate hard working and honest staff and the students alike and other stakeholders, but also sends a message that it’s who you know that matters rather than what you know and hard work does not pay in Kenya. What all and sundry are aware of is that in the past reappointment of the vice chancellors, deputy vice chancellors and principals of colleges are done through advertisements which allows the outgoing office holder to apply for consideration.

The deviation from the well established procedure to rely on recommendations from amorphous suspect councils given most of them work under the direction and tutelage of the vice chancellors beats the whole purpose of the reforms. The CS education has squarely fitted well into the schemes of the vice chancellors and councils and now for her to play safe, she endorses the recommendations which in themselves are wanting and throwing the reforms in jeopardy.

The minister has taken an arm’s length approach in the management of the affairs, and instead of rolling the sleeve backwards and face the challenge head-on, observed a don not so enthusiastic of what is happening at the ministry. The signal the minister has sent to those aspiring to be vice chancellors  is that what is important to reach a goal how one does that is not necessary and that the means justifies the end  does not pay to work hard and be prudency in the management of public funds and misuse of public funds does not count in ones reappointment.

The national government has set precedent in the latest cabinet appointments where those who had not performed were rewarded in ambassadorial postings. Similarly, those who contested in the last general election and were rejected by the electorate are laughing all the way after they were posted to lucrative positions in parastatals as chairmen of boards and board of directors of those boards. At the very least, one would have anticipated that the vice chancellors would have been considered for other postings as is happening in the case of the cabinet secretaries and chairs and directors of boards, fumed a disgusted don.

Talk of zero tolerance of corruption on one hand and on the other hand you offer someone  who vied for a senate, parliamentary seat or a governor a parastatal  job to recoup what they had spend during the elections and to a mass funds for 2022. Meanwhile, as the CS Education mulls over who to appoint in the council as Mbithi and his lobbyists assemble their deadly and lethal arsenals to influence the process, the top management is in tatters.

Prof Mutoro the deputy vice chancellor academic affairs, we have reliable dossier,  that he has thrown in the towel at the end of his first term and he is not interested in serving a second term under the stewardship of Mbithi as there is no love lost between the two as he has gone through hell in first term. Many aver that Prof Mutoro like his other peers, has been used by Mbithi in signing documents which could easily land him into problems. Further, the university has Prof Julius Ogengo, the new kid on the block, in Prof Mutoro’s position.  At the Finance Department things are elephant as it is only Mbithi and one a Mr Chege in  Finance who are signatories to bank accounts after Businei was suspended for fresh vetting.