The Parliamentary Budget Office (PBO) has recommended the scrapping of the national examinations fee waiver for Kenya Certificate of Primary Education (KCPE) and Kenya Certificate of Secondary Education (KCSE) candidates. The proposal comes amid concerns that the waiver has not helped the Kenya National Examinations Council (KNEC) address budget shortfalls, despite the government allocating Sh5 billion annually to cover the costs for all learners sitting for national exams.
Introduced in July 2020 by former President Uhuru Kenyatta, the waiver was extended to both public and private school learners. However, with increasing student enrolment due to the 100 per cent transition policy, the government has been struggling to meet the entire cost, leading to massive financial deficits at KNEC.
Budget experts have proposed a cost-sharing arrangement with parents to ensure sustainability. “The government should develop a cost-sharing approach for households to absorb the cost,” the experts advised. Redirecting the Sh5 billion to other critical areas in the education sector would address more pressing funding gaps, they argue.
The education sector is facing a staggering Sh91 billion funding deficit, affecting capitation, loans, and scholarships. According to the PBO report on the 2025-26 budget, the allocation for capitation in the current financial year is Sh191 billion—Sh23 billion less than the previous year’s allocation of Sh214 billion. This shortfall is impacting primary, secondary, and junior school education, as well as Technical and Vocational Education and Training (TVET) institutions and universities.
Primary schools are underfunded by Sh661 million, secondary schools by Sh16 billion, and junior secondary by Sh15 billion. TVET institutions have a capitation shortfall of Sh3.6 billion, while university scholarships and education loans face funding deficits of Sh5.3 billion and Sh11.4 billion, respectively. Additionally, continuing students’ capitation remains underfunded by Sh33 billion, putting further strain on the sector.
Experts warn that these funding shortages could affect the quality of education in the long run. To address this, they propose consolidating available resources, including bursaries, to ensure efficient allocation. The national and county governments currently allocate Sh20 billion annually to bursary programmes, but a fragmented approach leads to inefficiencies and multiple allocations.
PBO recommends a streamlined bursary allocation system to ensure funds are directed to the most impactful areas. Furthermore, the number of tertiary students receiving bursaries should be capped based on equitable criteria to optimize financial support.
As the debate on education financing continues, policymakers must balance affordability for parents with the need for sustainable and high-quality education funding.
