The question of how billions of shillings are being channelled from public schools to the Kenya Secondary School Heads Association (KESSHA) has emerged as one of the most contentious issues facing principals appearing before Parliament’s Public Investments Committee on Education and Governance.
The committee is probing payments that MPs estimate could total nearly KSh6 billion, arguing that the remittances raise fundamental questions about the legal basis for transferring public funds to an organisation whose financial operations, according to the committee, fall outside the Auditor-General’s direct scrutiny.
The inquiry has placed principals of Cluster One (C1) schools, formerly classified as national schools, under unprecedented parliamentary scrutiny as they respond to audit queries concerning financial management, internal controls and the use of public resources.
The Auditor-General has flagged weaknesses in bookkeeping, budgetary controls, expenditure management and asset management in several institutions. The concerns go beyond accounting entries, raising questions about whether some schools have sufficiently strong systems to safeguard public resources.
In one leading school, auditors questioned allowances paid through boarding and school-fund accounts to individuals without supporting documentation, board approval minutes or evidence of Salaries and Remuneration Commission circulars authorising the rates.
Other schools were found to have operated with unbalanced budgets, incomplete asset registers and no strategic plans. Auditors also raised concerns about compliance with the National Cohesion and Integration Act.
In one institution employing 65 people, 52 employees—about 80 per cent—were drawn from the same ethnic community. The audit cited Section 7(2) of the National Cohesion and Integration Act, 2008, which requires public institutions to reflect Kenya's diversity and restricts representation of one ethnic community to no more than one-third of staff.
But it is the KSSHA payments that have cut across several of the hearings.
PIC Education and Governance chairman Dick Maungu questioned why schools were transferring substantial amounts of public money to an organisation whose legal and financial status, in the committee's view, requires clarification.
“Kessha receives close to six billion shillings... which is not under the purview of the Auditor-General,” Maungu said.
At Alliance Girls High School, auditors flagged KSh128,500 remitted to KSSHA during the year under review. Principal Margaret Njeru did not dispute the payment but explained that the money supported co-curricular activities.
She argued that schools face underfunding for such programmes and that KSSHA helps organise joint activities that enable learners to participate in competitions and develop their talents.
The principal said the contribution was calculated on a per-student basis and was drawn from the school's operations and boarding accounts.
Loreto Girls School reported a considerably larger transfer, with its principal Lenah Ngesa telling the committee that KSh1.1 million had been sent to KSSHA to organise joint co-curricular activities and enhance talent development.
The explanations, however, did not satisfy committee members.
The MPs pressed the principals to identify the official authority that had directed them to remit the money and demanded evidence of a Ministry of Education circular authorising the payments.
When questioned about the authority for the Alliance Girls payment, Njeru maintained that the school's motivation was the need to support learners and develop talent.
That response prompted a sharper exchange, with Maungu questioning why the same commitment to learners could not be exercised while complying strictly with public-finance requirements.
The dispute exposes a difficult policy problem facing school heads: the educational need may be legitimate, but legitimacy of purpose does not automatically create legal authority to spend public money.
This distinction is likely to become central as Parliament continues examining the schools' accounts.
Co-curricular activities, sports and talent development are important components of education. But where public funds are involved, principals and boards must be able to demonstrate the legal authority, approved budget, supporting documentation and appropriate oversight behind every payment.
The committee therefore wants KSSHA's position examined directly and has indicated that its officials will be summoned to explain the organisation's role, funding arrangements and legal basis for receiving money from public schools.
Maungu also questioned why schools were relying on KSSHA to coordinate activities that, under the existing public education framework, should fall within the responsibilities of relevant education structures.
“The law says the county education board should do sports. What you're telling us is nothing is happening,” he said.
The unfolding hearings therefore present a much larger question than whether individual schools paid KSSHA.
They are testing the boundary between institutional initiative and public financial accountability.
If school heads are using public resources to address genuine gaps in sports, talent development and other learner programmes, the solution may require government to establish a transparent and properly funded mechanism through which such activities can be supported.
At the same time, associations receiving money from public institutions must operate within a clearly defined legal and accountability framework where public funds are involved.
For principals, the parliamentary scrutiny carries a personal dimension. The committee has warned that school heads could potentially face personal liability for financial losses where public funds are transferred without proper legal authority.
The hearings also reveal a broader governance challenge in Kenya's education sector. Schools cannot be expected to deliver increasingly ambitious co-curricular and academic programmes while operating with inadequate resources, yet financial pressure cannot become a licence to bypass procurement, budgeting, approval and accountability requirements.
The KSSHA controversy could therefore become a turning point in how public schools finance joint activities.
The immediate responsibility now rests with the committee to establish the legal basis of the payments, KSSHA officials to explain how the funds are received and utilised, and the Ministry of Education to clarify what school heads are legally permitted to finance from public school accounts.
For principals, the message from Parliament is increasingly clear: good intentions may explain why money was spent, but they do not by themselves establish authority to spend it.
By Hillary Muhalya.
Inset Ventures LTD
P. O. Box 7732 – 00100 GPO,
Nairobi.
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