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USIU, one of Kenya's top private varsities, is struggling. Here's why
The United States International University–Africa’s (USIU-A) financial position suggests that all is not well at one of Kenya’s best established private universities even as it goes through administrative changes.
Its faculty allege that it has been running on empty though enrolment remains fairly the same. A financial analysis shows that income from donations and fundraising has taken a big hit. This, they say, explains management’s intentions to lay off staff and slash salaries for others.
Some 54 faculty members sued USIU-A management last year to protest against attempts to cut salaries and withdraw some perks, including pension.
Documents seen by the Nation from the audited books of accounts indicate that USIU-A spends more money than it generates, although management contests that its financial health is not under threat. It, however, concedes that it relies too much on tuition fees for its operations.
It suggests that greater fundraising and improved research activity can bring in more income.
“It should be noted that a number of long-serving faculty have not actively contributed to enhanced research activity and they prefer to devote their time to classroom teaching,” one of the documents says.
Prof Paul Tiyambe Zeleza who will proceed on leave pending his departure after the expiry of his five-year contract at USIU-A.
Operating on deficits
The documents show that USIU-A has moved from enjoying surpluses to operating on deficits, raising serious questions about its management.
Administrators wrote to faculty and other staff in August last year expressing their intention to reduce their salaries and benefits as Covid-19 hit the economy. In October 2020, some employees were put on unpaid leave.
“Without implementing these measures the university’s financial survival and sustainability is severely threatened,” they said.
In an arbitration process, the faculty argue that the pandemic was not the cause of the financial problems but only magnified them.
The university council last month announced that the vice-chancellor, Prof Paul Tiyambe Zeleza, will proceed on leave pending his departure after the expiry of his five-year contract, a period during which USIU-A’s financial position deteriorated.
Dr Freida Brown, the interim USIU-A VC. She served as VC for 21 years before she retired.
Interim VC
He will be replaced in the interim by Dr Freida Brown, whom he succeeded in 2017, as the university recruits a substantive VC. Dr Brown had served as VC for 21 years before she retired. She will be in charge for nine months.
The faculty’s proposal on how to get USIU-A out of the red shows that its surplus had dwindled from Sh322,734,000 in the 2016/2017 financial year, when Dr Brown retired, to a deficit of Sh8,381,000 last year.
The previous year was even worse, recording a shortage of Sh38,420,000. The only surplus recorded under Prof Zeleza was the Sh48,773,000 realised in his first year in office.
Donations and auxiliary investments showed the largest drop, leaving USIU-A to depend solely on tuition fees. In 2019/2020, donors gave only Sh785,000, down from Sh18.3 million in 2014/2015, Sh16.3 million in 2015/2016 and Sh1 million the following year. Donations totalled Sh2.7 million in 2017/2018 but rose to Sh5.6 million the following year.
Administrators contested the accuracy of the figures, saying they contained misrepresentations and poor arguments, a claim the faculty rejected.
“Since faculty used data provided by the management, then management has inaccurate data. To dispute them now casts doubt on the authenticity of audited financial statements,” they said.
Low enrolments
Private universities have been hit hard by low enrolments since 2016 after reforms in the administration of national examinations resulted in fewer students qualifying for university admission.
However, they now benefit from allocations of government-sponsored students. This year, they will receive more than 28,000 but USIU-A opted not to participate in the programme.
Meanwhile, Prof Zeleza last week donated academic materials, including more than 10,000 textbooks valued at more than $1 million to the university library, at a ceremony attended by former Chief Justice Willy Mutunga.
They comprised personal academic papers featuring books, transcripts, research papers, journals and conference reports.
“Donating these books represents my dedication to enhancing the university’s learning and research capacities. It reflects my lifelong passion for promoting African knowledge production and cultivating the culture of philanthropy in African universities,” Prof Zeleza said.
USIU–A is one of the leading private universities in Kenya. It is the only university in the region with dual accreditation in Kenya by the Commission for University Education and in the US by WASC Senior College and University Commission.
