By The Weekly Vision Reporter
The University of Nairobi is facing fresh scrutiny after a new report by the Auditor-General revealed that the institution owes pensioners a staggering KSh 8.7 billion in unremitted contributions, with some of the debts dating as far back as November 2016.
According to Auditor-General Nancy Gathungu, the university is also burdened with significant rent arrears. It owes Ambank House, KSh 102,878,000 and Unipen Apartments, KSh 310,000, with 98 per cent of the arrears now more than 60 days overdue. The report warns that the recoverability of receivables amounting to KSh 123,726,000 remains doubtful.
The Auditor-General’s review of the University of Nairobi Pension Scheme (2007) shows that the institution’s outstanding pension contributions rose by KSh 1.5 billion, up from KSh 7.2 billion recorded the previous year.
Minutes of the Board of Trustees meeting held on 15 May 2025 indicate that the Retirement Benefits Authority (RBA) declined to approve the university’s proposed remedial plan, instead directing management to consult trustees and adjust interest rates in line with RBA guidelines.
However, by the time of the September 2025 audit, no further communication from the university had been provided. The report further notes that the valuation of outstanding contributions was not done in compliance with IFRS 9, as the university failed to make provisions for Expected Credit Losses (ECL). As a result, the Auditor-General said it was not possible to confirm the accuracy and regularity of the long-standing balance of KSh 8,702,628,000.
The university is also faulted for delays and irregularities in the installation of a pension administration software system. The scheme signed a contract worth KSh 13,359,789 with a local provider on 17 October 2022, but auditors found that progress reports, follow-up records and inspection documents were missing and therefore could not be verified.
This is not the first time the scheme has run into trouble over software procurement. In 2018, it paid KSh 7,162,000 to another contractor for a system that was never implemented. The Auditor-General now says it is impossible to confirm whether pensioners received value for money from the terminated project, or from the KSh 5,635,525 already spent on the new software contract.
In addition, the report highlights concerns over the management of investment income from Ambank House and Unipen Apartments.
A review of bank statements from 1 July 2024 to 31 May 2025 revealed that the property manager did not remit an unspecified amount of rental income to the scheme during several months, contravening the terms of the agency agreement.
The Auditor-General also cited:
- Irregular extensions of service contracts within the scheme
- Gaps in seminar and training expenditures
- General weaknesses in financial controls and oversight
The findings raise serious questions about the university’s financial governance and the protection of pensioners’ funds, with regulatory authorities now expected to demand firm corrective measures from the institution.
