The future of the Jomo Kenyatta Foundation hangs in the balance, with more than 14,000 students at risk of losing support, after a recent audit exposed severe financial and operational problems.
The state agency, responsible for scholarships and educational publications, is facing massive losses, unpaid debts, and governance gaps that threaten its survival.
Auditor General Nancy Gathungu’s report paints a troubling picture of an institution struggling to remain viable amid changing education policies and market pressures.
By June 2025, JKF had accumulated losses of Sh934 million, reflecting years of declining financial health. While the foundation recorded a net loss of Sh167 million in the year under review, a slight improvement from the Sh303 million loss the previous year, the auditor warned that this does little to change its overall insolvency risk.
“The losses have resulted in substantial erosion of the net worth of the foundation,” Gathungu noted, cautioning that JKF may not be able to meet its financial obligations and is technically insolvent. The audit showed a clear mismatch between assets and liabilities: current liabilities stood at Sh779 million, while current assets were just Sh207 million, leaving a negative working capital of Sh571.6 million.
The foundation’s leadership attributed the decline largely to the collapse of its publishing business, which had historically been its main source of income.
New policies that opened the textbook market to private publishers sharply reduced JKF’s market share. Publishing revenues fell 79 per cent, from Sh117 million to Sh25 million, affected by lack of government textbook orders, stiff competition from private schools, and large volumes of obsolete stock due to the shift to the Competency-Based Curriculum.
“Lack of any government orders meant that the public schools segment was largely locked out for Jomo Kenyatta Foundation, leaving her to compete with other publishers in the very small private schools market,” JKF chairperson Rose Waruhiu said in the annual report.
The foundation is also facing potential changes to its core mandate. JKF currently manages the World Bank-funded Elimu Scholarship Programme, supporting over 14,000 students nationwide.
But a presidential education reforms task force has recommended transferring this role to a new Kenya Basic Education Bursary and Scholarship Council. At the same time, JKF is listed among state agencies earmarked for dissolution under ongoing parastatal reforms, raising further doubts about its long-term operations.
The audit highlighted several operational failures that compound the crisis. JKF failed to remit Sh99.4 million in statutory deductions, including Pay-As-You-Earn, NSSF, NHIF, and pensions, exposing the agency to potential legal action, penalties, and interest.
Pending bills totaled Sh737 million, with Sh548 million overdue by more than a year. Gathungu warned that delayed payments increase the risk of litigation and loss of public funds.
Other issues included missing quarterly stock counts, casting doubt on the accuracy of Sh31 million in reported inventory, non-compliance with employment requirements for persons with disabilities, staff receiving net pay below the legally required threshold, unexplained adjustments in payables, errors in cash flow statements, and misstatements in grant disclosures.
The audit portrays a foundation at a crossroads, grappling with financial distress, structural reforms, and mounting operational risks, leaving its role in Kenya’s education landscape uncertain.
