The University of Nairobi Towers. UoN carries the largest statutory arrears at Sh8.8 billion. (File photo: Education News)

Public university vice-chancellors are seeking a government waiver of penalties and interest accrued over years of unpaid statutory deductions, as the cash-strapped institutions struggle to meet their obligations.

The outstanding bill for unremitted statutory deductions across public universities stood at Sh33.3 billion as of 31 January 2026, the Daily Nation reported on Monday 2 November.

The universities have asked the Ministry of Education to negotiate a waiver with the Kenya Revenue Authority (KRA), blaming chronic underfunding for their failure to remit statutory deductions even as they continue to pay employees their net salaries.

Appearing separately before the National Assembly Public Investments Committee on Governance and Education, University of Nairobi (UoN) Vice-Chancellor Ayub Gitau and his Kenyatta University counterpart, John Okumu, said universities had collectively petitioned the Ministry for intervention, but nothing had come out of the request.

Prof Okumu said KU had entered into payment arrangements with KRA but continued to default because of inadequate funding.

"We have payment plans but sometimes we default because it's the same issue of funding. Even as we indicate that we are paying salaries, we are paying the net because we don't have enough funds," he told the committee, chaired by Luanda MP Dick Maungu.

Delayed government funding has compounded the crisis for Kenyatta University, which is owed Sh3.6 billion by the Universities Fund and the Higher Education Loans Board (HELB).

"It is a cyclic problem. The people who are supposed to fund us, like HELB and the Universities Fund, also come back to the same government for funding, and they also don't get enough," Prof Okumu said.

UoN said it was working with the Ministry of Education to explore whether the government could take over its outstanding Pay As You Earn (PAYE) obligations to KRA. Prof Gitau also disclosed that the university had previously failed to remit pension deductions but had since prioritised payments to retiring employees. UoN is currently owed about Sh3 billion by the Universities Fund and HELB for the 2025/2026 financial year.

Data previously tabled in Parliament showed that UoN had the highest statutory deductions arrears at Sh8.8 billion, followed by Kenyatta University at Sh5.2 billion, Moi University at Sh4.7 billion, Technical University of Kenya at Sh4.4 billion, Jomo Kenyatta University of Agriculture and Technology at Sh4.3 billion and Egerton University at Sh3.3 billion.

The proposed waiver comes against the backdrop of mounting financial pressure in public universities, whose combined pending bills rose by 17.6 per cent to Sh100.3 billion in the eight months to January 2026, from Sh85 billion in July 2025. The liabilities include unpaid suppliers, capital projects, part-time lecturers, as well as unremitted statutory and Sacco deductions.

Committee chairman Dick Maungu noted that much of the universities' statutory debt was historical, with some obligations dating back nearly 20 years, and urged the universities and the Ministry to explore a broader solution, including writing off historical debts, to give institutions an opportunity to start afresh.

"The same government that funds you is the same government that desires this money to come back to it in terms of PAYE," Mr Maungu said.