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Navigating the Balance: Trends and Challenges in Education Financing in East Africa

Written by
Charles Nyukuri
Published
Topic(s):
Education Financing

Educational attainment should not be considered simply as a public good. It is an essential driving force that enables social empowerment and sustainable development of nations. In East Africa, there is a high level of government investment and commitment towards providing quality education to all members of society in order to meet the demands and objectives of the global SDGs and the Continental Education Strategy for Africa (CESA). However, translating these intentions into actions becomes very difficult when dealing with the financial issues associated with educational funding. The following analysis aims to provide an overview of the current trends regarding the financing of education in East Africa, with particular attention to the role of state budgets, external sources of funding and the impact of macroeconomic challenges faced by the region.

The Big Picture: A Look at Education Spending

In the past ten years, expenditure on education in less-developed nations, which includes countries from East Africa, has increased continuously (World Bank & UNESCO, 2024, p. 2). The rising expenditure proves that education is definitely a matter of policy concern. However, it may be misleading to focus only on the monetary value without factoring in the increasing population and the economy of the country. It would be much more accurate to determine the commitment of a nation towards the sector by focusing on its budget allocation.

The well-established international benchmarks suggest that countries should spend at least 15-20% of their national budget and 4-6% of their Gross Domestic Product (GDP) on education (ActionAid, 2024, p. 5). How does East Africa stack up? The picture is mixed. Kenya, for example, consistently allocates a large portion of its budget to education, often over 25%, which is a regional high point (Plan International, 2022, p. 39; Republic of Kenya, 2024, p. 4). But even with such a large budget share, the country doesn’t always hit the 6% of GDP target, showing how the overall size of the economy limits what can be spent (Plan International, 2022, p. 42).

Moreover, other countries in the region find it hard to achieve even the target of budget allocation. For instance, in recent times, the budget for education in Uganda and Tanzania has been limited to about 8% and 4%, respectively (Plan International, 2022, p. 39), which is way below the set international goals. This is a major issue in constructing a good education system for all children.

The Foundation and Cracks of the Domestic Budget

A country’s own funding is the most important and reliable source for its education system (IIEP-UNESCO, 2026, p. 1). However, in the case of East Africa, there are some issues which tend to undermine these resources.

One challenge is that funds are not always utilized efficiently. For example, it has been observed that nearly one-third (1/3) of the total expenditure on education in developing countries is wasted due to inefficiency such as leakage or poor program targeting (IIEP-UNESCO, 2026, p. 1). Decentralization and other reforms were introduced to address this problem and make sure that the process becomes more efficient. Decentralization was considered an excellent plan in theory but in reality, local governments often lack capacity in terms of staffing, skills and finance. In addition, central government grant formula may not allocate sufficient funds to regions where poverty rates are high or school enrollment is low (UNICEF, 2025, p. vii).

The second structural problem is that the way in which the money is spent is extremely skewed. In most cases, up to 80% of budget allocated to educational programs in the region is spent on teacher’s salary (Plan International, 2022, p. 45). It is clear that this is something that must be done, but there is very little left for anything else necessary to make the school work: constructing classrooms, purchasing books, purchasing lab material, or training teachers (Republic of Kenya, 2024, p. 144).

The Macroeconomic Squeeze: Debt, Austerity and Taxes

It is difficult for the governments of East Africa to increase their spending on education since the economies are faced with opposing pressures. With regard to the “4Ss” model (share, size, sensitivity and scrutiny of budget) the allocation of resources to education only counts where there is an increase in the size of the budget (ActionAid, 2024, p. 5).

Debt has turned into a huge barrier. More and more African countries have been diverting resources meant for their own development by using more of their budget toward debt servicing than allocating for education (ActionAid, 2024, p. 4). This means that every dollar, diverted toward the payment of debts is one dollar less being invested in education, such as employing a teacher, establishing school feeding programs, or allowing a girl child to attend classes in school. This challenge affects adolescent girls the most, because they are usually the first children to be withdrawn from schools during economic hardships.

Tied at the hip with debt are austerity policies. These are spending cuts often required by international lenders like the IMF in exchange for new loans. A common austerity measure is to cap the public sector wage bill. Since teachers make up the largest group of public employees, these caps make it nearly impossible for governments to hire the millions of new teachers they desperately need to reduce overcrowded classrooms and improve learning quality (ActionAid, 2024, p. 5).

Last but not least comes the issue of tax. The majority of African countries generate little in terms of tax revenue, which is usually less than 15% compared to more than 33% in advanced economies (ActionAid, 2024, p. 3). It is due to the tiny size of the revenue that government budgets cannot be more flexible. Each year, many billions of dollars in revenue get lost through corporate and elite tax evasion. Were countries able to implement progressive changes in their taxation regime, thus making rich people pay their due, they would be able to bring about significant budgetary gains (ActionAid, 2024, p. 3).

The Role of Aid and Global Partnerships

In any case, foreign aid, or ODA, continues to be the lifeline of the poorest countries, with organizations such as the Global Partnership for Education (GPE) being among the major stakeholders in the mobilization of resources and advocacy for reforms within states. Indeed, some of the funding mechanisms devised by the GPE, including the GPE Multiplier, have proven highly effective in attracting billions of additional dollars from other donors and private investors (GPE, 2025, p. 6).

However, aid is not a permanent solution. Recent trends are worrying: even as the total amount of aid for education has grown, it makes up a smaller share of total aid, as donors have shifted focus to other global crises (Education Finance Watch, 2024, p. 3). This unpredictability shows why it’s so critical for countries to build up their own sustainable funding sources.

The Human Cost: Who Pays the Price for Underfunding?

At the end of the day, these numbers and trends matter because they have a real-world impact on students. And when budgets are tight, it’s the most vulnerable learners who pay the highest price.

  1. Gender: Girls are particularly affected. With declining state investment and increasing costs of schooling, it is girls who are most often taken out of school to assist with domestic chores or early marriage (Plan International, 2012, p. 27). In addition, inadequate state budgets that do not cater for the provision of proper sanitary facilities and free sanitary items cause a large number of girls to drop out of school. Therefore, gender-based budgeting which involves planning and investing resources taking into consideration the needs of girls and boys is very important (IIEP-UNESCO, 2026, p. 1).
  2. Disability and marginalization: Students with disabilities, children in remote rural villages, and those from the poorest families need targeted support. But these specialized programs are often the first on the chopping block when budgets are cut. Inclusive education isn’t cheap; it requires dedicated funding for assistive technology, specially trained teachers, and accessible classrooms: investments that remain a low priority in many budgets (Plan International, 2022, p. 57).

Conclusion and The Path Forward

Education finance in East Africa faces a critical point in time. Although there is evident political commitment and some successes have been achieved, the sector finds itself in an environment where growing demand clashes with inadequate finances. There is a need to move past vague aspirations to concrete and workable measures which ministries, among other stakeholders, must embrace. Below are four practical priorities that should guide change in education finance:

1.     Make the Inter-Ministerial Case for Education Investment.

The ministry may not be responsible for determining taxation policy but can become its own biggest advocate. Rather than pleading for a larger piece of the budget, the ministry needs to show why an increase in the size of the budget is necessary.

  • Cost out the national education plan: Develop a detailed, evidence-based costing of what it will actually take to achieve national targets (e.g., hiring 50,000 new teachers, equipping all junior secondary schools for CBC, achieving a 1:1 textbook ratio). Present this as a concrete investment case to the Ministry of Finance and Parliament.
  • Track and publicize the “education deficit”: Regularly quantify and report on the difference between what is available and what is needed. This should not be seen as a whining exercise but as an “educational shortfall,” which affects national development, demonstrating how such tradeoffs have been made.
  • Demonstrate long-term economic returns: Partner with economists and researchers to model the long-term GDP growth, increased tax revenue, and reduced healthcare costs associated with improved educational outcomes. Use this data to argue that education is not just an expense, but a foundational economic investment.

2.     Drive Efficiency and Equity from Within the System.

Before asking for more money, it’s important to show that every penny currently allocated is being used effectively. Ministries have significant control over making their existing budgets work harder and smarter.

  • Reform capitation grant formulas: Assess and restructure the equations that are used to allocate money to schools. The equations should be equitable in nature, ensuring that weighted funds are allocated to schools that operate in areas with high poverty levels, have more students with special needs, and are located in rural settings. This can be a useful means of tackling inequities (UNICEF, 2025, p. 38).
  • Empower and train local financial managers: Invest in practical financial management training for head teachers, school boards, and district education officials. Simple skills in budgeting, procurement, and reporting can drastically reduce leakage and improve how resources are used at the school level, ensuring funds are spent on actual learning needs.
  • Prioritize and fund what works: Cost-effectiveness studies should be done on various interventions in education. There should be dedicated budget lines to successful, high-impact programs such as structured pedagogies for early-grade reading or remediation efforts, instead of spreading thin resources among many non-tested interventions.

3. Implement Targeted, Gender-Responsive Budgeting.

Moving “gender-responsive budgeting” from a buzzword to a reality means creating specific, non-negotiable budget lines that address the financial barriers girls face.

  • Ring-fence funds for girls’ essentials: Budgets should have specific lines that allow the provision of free sanitary towels and also require that all funding for schools must allocate a specific portion to building gender-separated latrines (Plan International, 2012, p. 45).
  • Fund targeted support for at-risk girls: Direct resources towards educational scholarships targeted at girls in their teens who come from impoverished families, as they are the most susceptible to school dropout due to financial constraints.
  • Invest in safety and protection: Earmark funds for programs that address school-related gender-based violence, including training for teachers on creating safe classrooms and establishing clear, confidential reporting mechanisms for students.

4.     Mitigate the Impact of Macroeconomic Shocks.

While education ministries can’t negotiate international debt, they can play a defensive role to protect their budgets from the impacts of debt and austerity.

  • Establish social spending floors: As part of negotiations within the framework of national budgets and talks with international financial institutions, the Ministry of Education should lobby for socially protected “budget floors” where there will be an agreement that under no circumstances can the budget of education fall below a certain minimum amount.
  • Quantify the cost of austerity on learning: In the event of proposals being made regarding wage freezes in the public sector, the ministry must immediately create a model showing the implications of such a proposal: “Teacher hiring freeze would mean that the teacher-student ratio goes up from 45:1 to 55:1, negatively impacting the education of X million kids.”

Through these more precise and practical methods, education managers in East Africa will be able to transform themselves from mere observers of an uncertain budgeting process into proactive designers of a sustainable financing scheme for their education sectors.

 

References

1.     ActionAid. (2024). Transforming education financing in Africa: A strategic agenda for the African Union year of education. ActionAid International. <https://share.google/l25Yq1O4awHujs9fB>

2.     Global Partnership for Education. (2025). Results report 2025. GPE Secretariat. <https://share.google/5Pkce5I6LW94ID7Vc>

3.     International Institute for Educational Planning (IIEP-UNESCO). (2026, April 11). Financing education for gender equality. IIEP-UNESCO. <https://www.iiep.unesco.org/en/projects/financing-education-gender-equality>

4.     Malala Fund, MENAFem, Nala Feminist Collective, Plan International, & Restless Development. (2025). Girls before creditors: The case for prioritising girls in G20 debt reforms. Malala Fund. <https://malala.org/news-and-voices/debt-justice-is-girls-rights-malala-fund>

5.     Plan International. (2012). Because I am a girl: The state of the world’s girls 2012 - Progress and obstacles to girls’ education in Africa. Plan International. <https://plan-international.org/uploads/2022/01/progress-obstacles-to-girls-education-in-africa.pdf>

6.     Plan International. (2022). Financing education in the MEESA region: Gaps & opportunities towards sustainable financing beyond GPE commitments. Plan International MEESA Regional Hub. <https://plan-international.org/uploads/2022/09/FINANCING-EDUCATION-IN-MEESA-REGION-EXECUTIVE-SUMMARY_Final.pdf>

7.     Republic of Kenya. (2024). Education sector medium term expenditure framework 2025/26 – 2027/28: 2024 education sector report. Ministry of Education. <https://share.google/VmAElrxfE2wYn0sCQ>

8.     UNICEF. (2025). Impact of decentralization reforms on financing and access to pre-primary and primary education in Eastern and Southern Africa: Regional report. UNICEF Eastern and Southern Africa Regional Office. <https://share.google/paTKNsnm0YQXsiStg>

9.     World Bank & UNESCO. (2024). Education finance watch 2024. The World Bank; The Global Education Monitoring (GEM) Report; UNESCO Institute for Statistics (UIS). <https://share.google/t0SeXSlvhlQOjwZ3L>