The constitutional promise for free and compulsory basic education for all children in Kenya remains elusive 16 years after the promulgation of the Constitution of Kenya, 2010. Even the enactment of the Basic Education Act, 2013 that was meant to give effect to Article 53 of the Constitution has not helped. Only one thing explains this failure: a lack of solid government commitment. Report after report after report (read executive summaries) reveal that inadequate capitation is a major challenge facing the education sector, yet both parliament and the executive branches of government do little to address the issue. But for how long?
Underfunding Education Through Inadequate Capitation
It is unfortunate that the recent reforms in the education sector relegated the financing problem to a minor issue, yet it is a major challenge capable of collapsing the entire sector. Chapter Four of the Presidential Working Party on Education Reforms (PWPER) report notes that government capitation is the main source of financing for schools. But then through its behaviour, government underfunds schools and thereby fails to discharge its obligation. First by parliament allocating inadequate capitation. Then, the National Treasury failing to release the entire capitation amounts to schools.
Table 1: Capitation Amounts Under Different Scenarios Using FY 2026/27 Budget Numbers
Source: Author’s Calculation, Data from National Treasury
But arriving at the adequate capitation amounts should be easy. Table 1 above shows different capitations based on different rates (Scenarios). The National Treasury in the Program Based Budget (PBB) indicates that the targeted enrolment in primary schools in FY 2026/27 was 6,265,111 learners. But since primary school level capitation is Ksh.1,420 per student, simple multiplication gives Ksh.8.9 billion (Scenario 1). Why then would parliament, which should be informed about enrolment numbers, approve Ksh.7.0 billion for capitation instead of Ksh.8.9 billion, resulting in underfunding of Ksh1.9 billion?
Allocating Ksh.7 billion for 6.9 million learners could be interpreted in two ways. First is that every learner gets a share of it but only receives 78% share of amounts entitled to. The second conclusion is that government sufficiently funds only 79% of the learners and excludes the other 21%). Such exclusion implies unfair discrimination and is therefore a violation of the Constitution, including the rights under Article 53(1b). This second assumption is more plausible because the Ministry of Education seems not to know the exact number of leaners in public schools. In the Special Audit Report on Capitation and Infrastructure Grants in Schools covering FY 2020/21 to 2023/24, the Auditor General uncovered inconsistencies between actual enrolments and information from National Education Management Information Systems (NEMIS).
Therefore, with enrolment numbers and capitation amounts known, parliament should have allocated Ksh8.9 billion under the current capitation policy (First scenario). In the second scenario, which is the capitation amount recommended by the Presidential Taskforce, the amount would be Ksh.14 billion. As such, the current allocation would result in a 50% funding gap. The final scenario is explained below.
Table 2: Inflation Effect on Capitation Amounts Per Learner per Year Between 2005 and 2025
Source: Author’s Calculation based on Data from KNBS
It is obvious that inflation erodes the value of money over time. Table 2 above therefore illustrates that prices have risen 275% since 2005 on the account of inflation. It also shows that the real value of the original capitation of 2003 now stands at only Ksh271 and therefore one would require Ksh3,828 to have an equivalent purchasing power. Therefore, if the capitation amount of 2003 is retained at Ksh1,020 but adjusted for inflation, each learner would be allocated Ksh3,828, translating to a total capitation of Ksh24 billion. This will create a funding gap of Ksh.17 billion (Scenario 3 in Table 1 above).
On that basis the Presidential Taskforce recommendation on the review of capitation every three years (Executive Summary: Recommendation 10) is therefore reasonable . However, it does not provide a rational to be used in the review. Ideally, the capitation rates could be adjusted annually based on the prevailing inflation rates to always maintain their purchasing power. Periodic reviews may be necessary whenever new programs are introduced.
The Presidential Taskforce report clearly lacks coherence. On the one hand, the taskforce finds in Chapter Five on Basic Education Financing that “Although the Government has made important strides in the provision of capitation to schools, the current level is inadequate to meet the rising cost of goods and services since it does not factor in inflation”. This observation is repeated in the education sector reports.
On the other hand, it recommends for a review of capitation amounts from the current Ksh.1,420 to 2,238 per learner. As demonstrated in Table 2 above, that was the amount requires around 2015 and therefore inadequate in the present time. The taskforce clearly overlooked their own finding quoted above. Such incoherence is bad for policy and should never be excused.
The Taskforce in Chapter 13 (see the Implementation Matrix) further proposed six months for the implementation of the recommendations on basic education financing. Unfortunately, this excellent recomendation was ignored by the Ministry of Education, which continues to apply outdated capitation rates. One may wonder why the Ministry was selective in the implementation of the financing proposals. For instance, proposals for Junior Secondary School (JSS) capitation and for the New Funding Model for tertiary level education were adopted and implemented almost immediately. Why did the recommendations for primary school level ignored? Remember that primary schools had no option but to implement a more resource demanding CBC under the 8-4-4 capitation model for 10 years resulting in the accumulation of pending bills.
Conclusion and Recommendations
Here is the summary of the argument. First, the capitation amounts for primary schools are inadequate as explained above and should be reviewed. Second, the Presidential Taskforce recommendations are only partially correct: They were correct on the implementation timelines, partially correct on periodic reviews and entirely wrong on capitation rates. Finally, and which answers the question raised in paragraph one, a proper costing for CBC implementation needs to be conducted before start of 2027 academic year to end the persistent underfunding. In the interim, restoring the purchasing power of the 2003 capitation, which is Ksh.3,828 in 2025, should be appropriate. This translates to Ksh.24 billion, and therefore an additional Ksh17 billion would be required.
Finding the additional capitation Ksh17 billion should be easier. It is just two days of revenue collection based on 2025/26 revenue performance and will not require hiking tax rates. Instead, parliament should simply reallocate it from amounts appropriated to the unconstitutional National Government Constituency Development Fund (NG – CDF) through a supplementary budget. This proposal passes the requirements for supplementary appropriations as set in Article 223 (1a) and (5) of the Constitution and Section 40 of the PFM (National Government) Regulations, 2015.
Government being the main source of school capitation, the responsible branches of government should ensure adequate capitation is allocated and is fully released to schools in time. While undesirable, a supplementary budget for the purpose of fixing a crucial social sector is justifiable. Such measures will greatly boost the realization of the constitutional promise for free and compulsory basic education. It can be done now. It should be done now.
Kenya has benefited from its relations with the world. Multilateral, plurilateral or bilateral relationships with other countries has increased Kenyan firms and individuals market access, peace cooperations, import sources and aid. Kenya has trade relations with the United State of America and the Islamic Republic of Iran. One of the most consequential relationships between the […]
The National Infrastructure Fund Act (No. 4 of 2026) took effect on 25 March 2026 with a headline financing target: to raise about Ksh 5 trillion over ten years for highways, railways, ports, energy, information and communications technology, water and irrigation. The plan works like this. Privatization proceeds become the Fund’s starting capital. That capital […]
Introduction The matatu metaphor can be used to analytically frame Kenya’s budget as a system that is subject to binding constraints, evolving expectations, and continuous adjustment to shocks. Like the matatu sector, fiscal policy reflects a balancing act between efficiency and quick action seeking to respond to public service delivery while constrained by competing sector […]
Introduction Imagine paying the same fare to travel at 6 a.m. as you would at 6 p.m., even though the matatu is half-empty in the morning and packed in the evening. At 6 a.m., there may be more seats available than passengers willing to pay for them. By 6 p.m., the situation is reversed. Hundreds […]
Absurd hypotheticals are useful precisely because they stress-test a system until its constraints become visible. This note asks what would break first if SpaceX, now a public company following its record-breaking Nasdaq debut in June 2026, with a post-IPO market value of approximately US$ 2.5 trillion, sought a secondary cross-listing on the Nairobi Securities Exchange. […]
| Post date: Fri, Jul 24, 2026 |
| Category: Education |
| By: Jairus Kedogo, |
The constitutional promise for free and compulsory basic education for all children in Kenya remains elusive 16 years after the promulgation of the Constitution of Kenya, 2010. Even the enactment of the Basic Education Act, 2013 that was meant to give effect to Article 53 of the Constitution has not helped. Only one thing explains this failure: a lack of solid government commitment. Report after report after report (read executive summaries) reveal that inadequate capitation is a major challenge facing the education sector, yet both parliament and the executive branches of government do little to address the issue. But for how long?
Underfunding Education Through Inadequate Capitation
It is unfortunate that the recent reforms in the education sector relegated the financing problem to a minor issue, yet it is a major challenge capable of collapsing the entire sector. Chapter Four of the Presidential Working Party on Education Reforms (PWPER) report notes that government capitation is the main source of financing for schools. But then through its behaviour, government underfunds schools and thereby fails to discharge its obligation. First by parliament allocating inadequate capitation. Then, the National Treasury failing to release the entire capitation amounts to schools.
Table 1: Capitation Amounts Under Different Scenarios Using FY 2026/27 Budget Numbers
Source: Author’s Calculation, Data from National Treasury
But arriving at the adequate capitation amounts should be easy. Table 1 above shows different capitations based on different rates (Scenarios). The National Treasury in the Program Based Budget (PBB) indicates that the targeted enrolment in primary schools in FY 2026/27 was 6,265,111 learners. But since primary school level capitation is Ksh.1,420 per student, simple multiplication gives Ksh.8.9 billion (Scenario 1). Why then would parliament, which should be informed about enrolment numbers, approve Ksh.7.0 billion for capitation instead of Ksh.8.9 billion, resulting in underfunding of Ksh1.9 billion?
Allocating Ksh.7 billion for 6.9 million learners could be interpreted in two ways. First is that every learner gets a share of it but only receives 78% share of amounts entitled to. The second conclusion is that government sufficiently funds only 79% of the learners and excludes the other 21%). Such exclusion implies unfair discrimination and is therefore a violation of the Constitution, including the rights under Article 53(1b). This second assumption is more plausible because the Ministry of Education seems not to know the exact number of leaners in public schools. In the Special Audit Report on Capitation and Infrastructure Grants in Schools covering FY 2020/21 to 2023/24, the Auditor General uncovered inconsistencies between actual enrolments and information from National Education Management Information Systems (NEMIS).
Therefore, with enrolment numbers and capitation amounts known, parliament should have allocated Ksh8.9 billion under the current capitation policy (First scenario). In the second scenario, which is the capitation amount recommended by the Presidential Taskforce, the amount would be Ksh.14 billion. As such, the current allocation would result in a 50% funding gap. The final scenario is explained below.
Table 2: Inflation Effect on Capitation Amounts Per Learner per Year Between 2005 and 2025
Source: Author’s Calculation based on Data from KNBS
It is obvious that inflation erodes the value of money over time. Table 2 above therefore illustrates that prices have risen 275% since 2005 on the account of inflation. It also shows that the real value of the original capitation of 2003 now stands at only Ksh271 and therefore one would require Ksh3,828 to have an equivalent purchasing power. Therefore, if the capitation amount of 2003 is retained at Ksh1,020 but adjusted for inflation, each learner would be allocated Ksh3,828, translating to a total capitation of Ksh24 billion. This will create a funding gap of Ksh.17 billion (Scenario 3 in Table 1 above).
On that basis the Presidential Taskforce recommendation on the review of capitation every three years (Executive Summary: Recommendation 10) is therefore reasonable . However, it does not provide a rational to be used in the review. Ideally, the capitation rates could be adjusted annually based on the prevailing inflation rates to always maintain their purchasing power. Periodic reviews may be necessary whenever new programs are introduced.
The Presidential Taskforce report clearly lacks coherence. On the one hand, the taskforce finds in Chapter Five on Basic Education Financing that “Although the Government has made important strides in the provision of capitation to schools, the current level is inadequate to meet the rising cost of goods and services since it does not factor in inflation”. This observation is repeated in the education sector reports.
On the other hand, it recommends for a review of capitation amounts from the current Ksh.1,420 to 2,238 per learner. As demonstrated in Table 2 above, that was the amount requires around 2015 and therefore inadequate in the present time. The taskforce clearly overlooked their own finding quoted above. Such incoherence is bad for policy and should never be excused.
The Taskforce in Chapter 13 (see the Implementation Matrix) further proposed six months for the implementation of the recommendations on basic education financing. Unfortunately, this excellent recomendation was ignored by the Ministry of Education, which continues to apply outdated capitation rates. One may wonder why the Ministry was selective in the implementation of the financing proposals. For instance, proposals for Junior Secondary School (JSS) capitation and for the New Funding Model for tertiary level education were adopted and implemented almost immediately. Why did the recommendations for primary school level ignored? Remember that primary schools had no option but to implement a more resource demanding CBC under the 8-4-4 capitation model for 10 years resulting in the accumulation of pending bills.
Conclusion and Recommendations
Here is the summary of the argument. First, the capitation amounts for primary schools are inadequate as explained above and should be reviewed. Second, the Presidential Taskforce recommendations are only partially correct: They were correct on the implementation timelines, partially correct on periodic reviews and entirely wrong on capitation rates. Finally, and which answers the question raised in paragraph one, a proper costing for CBC implementation needs to be conducted before start of 2027 academic year to end the persistent underfunding. In the interim, restoring the purchasing power of the 2003 capitation, which is Ksh.3,828 in 2025, should be appropriate. This translates to Ksh.24 billion, and therefore an additional Ksh17 billion would be required.
Finding the additional capitation Ksh17 billion should be easier. It is just two days of revenue collection based on 2025/26 revenue performance and will not require hiking tax rates. Instead, parliament should simply reallocate it from amounts appropriated to the unconstitutional National Government Constituency Development Fund (NG – CDF) through a supplementary budget. This proposal passes the requirements for supplementary appropriations as set in Article 223 (1a) and (5) of the Constitution and Section 40 of the PFM (National Government) Regulations, 2015.
Government being the main source of school capitation, the responsible branches of government should ensure adequate capitation is allocated and is fully released to schools in time. While undesirable, a supplementary budget for the purpose of fixing a crucial social sector is justifiable. Such measures will greatly boost the realization of the constitutional promise for free and compulsory basic education. It can be done now. It should be done now.
Kenya has benefited from its relations with the world. Multilateral, plurilateral or bilateral relationships with other countries has increased Kenyan firms and individuals market access, peace cooperations, import sources and aid. Kenya has trade relations with the United State of America and the Islamic Republic of Iran. One of the most consequential relationships between the […]
The National Infrastructure Fund Act (No. 4 of 2026) took effect on 25 March 2026 with a headline financing target: to raise about Ksh 5 trillion over ten years for highways, railways, ports, energy, information and communications technology, water and irrigation. The plan works like this. Privatization proceeds become the Fund’s starting capital. That capital […]
Introduction The matatu metaphor can be used to analytically frame Kenya’s budget as a system that is subject to binding constraints, evolving expectations, and continuous adjustment to shocks. Like the matatu sector, fiscal policy reflects a balancing act between efficiency and quick action seeking to respond to public service delivery while constrained by competing sector […]
Introduction Imagine paying the same fare to travel at 6 a.m. as you would at 6 p.m., even though the matatu is half-empty in the morning and packed in the evening. At 6 a.m., there may be more seats available than passengers willing to pay for them. By 6 p.m., the situation is reversed. Hundreds […]
Absurd hypotheticals are useful precisely because they stress-test a system until its constraints become visible. This note asks what would break first if SpaceX, now a public company following its record-breaking Nasdaq debut in June 2026, with a post-IPO market value of approximately US$ 2.5 trillion, sought a secondary cross-listing on the Nairobi Securities Exchange. […]