University of Nairobi crippled by major cash crisis

March 3, 2000

NAIROBI

The University of Nairobi has crippling debts of more than Pounds 13 million and creditors have threatened to withdraw services until they are paid.

The local power-generating company has disconnected electricity in students' hostels, laboratories and other sections of the university because of unpaid bills amounting to Pounds 1.72 million. The telecommunications company, with an outstanding debt of Pounds 200,000, has warned it could cut off telephones without notice.

Nairobi City Council is also owed more than Pounds 100,000 in water bills and other rates. The local authority, with financial woes of its own, has said it may be forced to disconnect water supplies until the university has paid. Other creditors owed by the university include food and stationery suppliers, workers' pension funds and drug stores.

Vice-chancellor Francis Gichaga attributed the problem to the inability of the government to support the university. "Government allocates Pounds 1.08 million each month while the university's wage bill alone is Pounds 1.32 million."

The university council has sought government permission to increase student fees from the current flat rate of Pounds 150 a year for all courses to a maximum of Pounds 700, for medical students.

The government is unwilling to commit itself on the proposed fees. Education minister Stephen Kalonzo Musyoka said there was no money to increase spending on university education.

Meanwhile, the university has established an enterprise services company to generate income through dairy farming, floriculture, dry crops farming and cereal seed multiplication, petrol stations, book publishing and mortuary services. However, the leading income-generating project is a part-time degree programme, which last year earned the university about Pounds 3 million.

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