By Reporter
The University of Nairobi Management has been given two weeks to provide documentary evidence explaining billions of shillings in unpaid pension contributions and statutory deductions, as MPs questioned how the liabilities accumulated over the years.
The National Assembly Public Investments Committee on Governance and Education, chaired by Luanda MP Dick Maungu, demanded supporting documents from the university’s management during a review of Auditor-General’s reports covering the 2020/2021 to 2024/2025 financial years.
The committee questioned Vice-Chancellor Prof. Eng. Ayub Njoroge Gitau and his team over outstanding pension contributions, unpaid Pay As You Earn (PAYE) taxes and the institution’s proposed measures to address the growing liabilities.
Maungu said the university’s explanations were not backed by sufficient evidence, making it difficult for the committee to establish the extent of the problem and assess the effectiveness of the corrective measures.
“There’s nothing to support the good stories,” Maungu told the university officials, insisting that the management provide documents demonstrating what had been done to address the outstanding obligations.
The committee’s concerns followed revelations by the Office of the Auditor-General that the university failed to remit about Sh1.4 billion in pension contributions and Sh50 million in PAYE during the 2021/2022 financial year alone.
The audit discussion also highlighted substantial accumulated balances from previous years, with MPs questioning why deductions from employees’ salaries had not been remitted to the relevant institutions.
Kasipul MP Boyd Were questioned the management over unpaid PAYE, warning that penalties and interest could significantly increase the outstanding amount.
“How did it happen that there was an accumulation of up to Sh5 billion?” asked Lungalunga MP Chiforomodo Mangale, who demanded an explanation for the accumulation of pension and tax liabilities.
He warned that the committee would not accept explanations without supporting documents.
“We are not here to sanitise issues. We need to get to the root of what happened,” Mangale said.
Central Imenti MP Moses Kirima also called for a thorough examination of the liabilities, drawing parallels with concerns previously raised over financial irregularities at Moi University.
He urged the committee to establish how the debts accumulated and whether there were weaknesses in the institution’s financial management.
Prof. Gitau told MPs that the university had started making pension payments to retiring employees and had resumed remitting pension deductions in recent months.
He acknowledged, however, that the institution continued to face a deficit and was working with pension scheme trustees to develop a recovery plan.
The vice-chancellor said the university was exploring the possibility of using some of its land and other assets to help address the pension deficit, which he said had grown from about Sh5 billion to more than Sh10 billion.
He also disclosed that the Government still owed the university slightly more than Sh3 billion in outstanding funding and Higher Education Loans Board-related payments.
The management said the pending government payments had reduced from nearly Sh5 billion to just over Sh3 billion, but the outstanding amount remained a financial burden.
Deputy Vice-Chancellor in charge of Finance, Planning and Development Prof. Josiah Omollo Aduda told the committee that the university had submitted a remedial payment plan to the Retirement Benefits Authority and was engaging the Kenya Revenue Authority over the unpaid taxes.
He said the university had held discussions with the relevant agencies and was working towards meeting its statutory obligations.
However, MPs insisted that the university produce correspondence, payment records and other documentation to substantiate the claims.
The university’s acting Director of Finance, Stephen Kimeli, attributed the financial difficulties to several factors, including the cost of collective bargaining agreements, reduced student numbers, changes in university funding and the effects of the Covid-19 pandemic.
He said the institution had undertaken reforms to reduce expenditure, including measures targeting personnel costs, post-retirement contracts and staff meal payments.
Kimeli added that the university was pursuing the commercialisation of its assets to generate additional revenue and had undertaken a valuation of its property.
He said the proposals had been forwarded to the university council for consideration.
The management also cited a staff strike as a further challenge affecting its day-to-day revenue.
Maungu directed the university to submit the outstanding documents within two weeks, saying the committee needed to compare the institution’s financial position over the years and verify the measures taken to resolve the liabilities.
The committee said it would use the documents, alongside the Auditor-General’s findings, to assess the university’s progress and determine whether the proposed interventions were producing tangible results.
