Inside Moi University’s financial crisis: How the once-prestigious institution is struggling to stay afloat
By William Muthama, July 4, 2026Moi University, once regarded as one of Kenya’s leading public universities and a strong rival to the University of Nairobi, is now battling a severe financial crisis that has pushed it into technical insolvency.
As of July 2026, the institution is weighed down by debts exceeding Ksh8 billion, while pending bills have risen beyond Ksh10 billion.
Its liabilities now outstrip current assets by about Ksh8.6 billion, placing the university in a deeply fragile financial position.
University leadership, led by Acting Vice-Chancellor Prof. Kiplagat Kotut, told Parliament that the crisis has been building for years, gradually tightening pressure on day-to-day operations.
Mounting debt pressure
The financial strain has built up over time, leaving the institution struggling to clear obligations as they fall due.
The pending bills include unpaid salaries, pensions, supplier arrears and statutory deductions, all of which continue to accumulate as funding gaps widen.
Prof. Kotut told the National Assembly’s Education Committee that the university has been operating under increasing pressure, with limited room to manage its financial obligations.
Strained operations
At the centre of the crisis is a wage bill that has at times consumed up to 88 per cent of the university’s revenue, far above the recommended sustainable level of about 35 per cent.
With declining student enrolment and reduced government funding under the Differentiated Unit Cost (DUC) model, income has dropped sharply while expenses have remained high.
This imbalance has made it difficult for the institution to meet monthly obligations, leading to salary delays and unpaid suppliers.
Staff layoffs
To contain the crisis, Moi University has repeatedly turned to workforce reduction as a key cost-cutting measure.
In March 2025, the university dismissed more than 324 contract staff. By May 2025, nearly 900 employees were issued with redundancy notices, including about 120 lecturers.
In one phase of the exercise, roughly 376 staff were affected, with severance packages totalling Ksh 167.4 million.
The move sparked strong opposition from staff unions, leading to court interventions that temporarily halted parts of the redundancy process.
As of July 2026, a fresh staff rationalisation plan is underway following a comprehensive workload audit. Acting Vice-Chancellor told Parliament that the exercise aims to align staffing levels with available work and reduce the unsustainable wage burden.
He noted that some staff have limited or unclear workload allocations, making restructuring necessary to improve efficiency.
We realised some people have actually not been teaching. They have been here doing nothing, parasitising on others. So, we are saying if you have not been doing anything, why don’t we let you go? But those that have workload we don’t want to touch you,” he said.
Root of the crisis
The financial pressure has repeatedly triggered industrial unrest, disrupting learning and academic calendars.
In 2024, the main campus was closed for nearly two months after lecturers went on strike over unpaid arrears and statutory deductions. Students were forced to leave campus, with many courses delayed as a result.
For some students, especially in medical programmes, the disruptions have stretched study periods significantly.
Moi University’s challenges did not begin recently. They stem from years of expansion, reduced funding and rising staff costs.
The establishment of multiple satellite campuses, combined with declining enrolment after changes in government sponsorship models, significantly reduced revenue.
Past audit reports have also raised concerns about management inefficiencies that deepened the financial strain.