KU Salaries: Kenyatta University is running broke. The institution, which is considered one of the best in Kenya is struggling to stay afloat amidst a deepening financial crisis. New reports say that the university recently paid its staff with cheques that ended up bouncing at the bank.
This comes as the Kenya Revenue Authority froze all bank accounts associated with the university due to tax arrears running up to Sh. 2 billion.
“The university has been unable to meet its daily running operations on account of shrinking revenue and routinely uses bank overdrafts to pay salaries. In September, the university resorted to pay staff using cheques, which were rejected by banks,” a report that appeared in the Sunday Nation said.
In August 2021, the Auditor General Nancy Gathungu revealed that KU had dipped into Sh. 1.3 billion deficit in the year to June, forcing it to rely on short term loans to finance its operations.
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Ms. Gathungu added that the university is operating under financial difficulties and is relying on costly borrowings which may further worsen the liquidity problem. “The university is therefore, technically insolvent and if no urgent positive measures are taken to improve the financial position, it may not be able to meet its mandate in future,” she said.