This paper identifies the twin problems of higher education financing in Africa-inadequate resources and poor use of existing resources-and traces them to the preponderance of free, public tertiary education in most countries, despite a weak economic rationale for such an approach and unintended consequences of inequitable access and politicization of higher education. It proposes a reform of higher education finance based on principles of rationalizing government's role, taking into account the politics of such reforms and the institutional changes needed for a well-functioning system of tertiary education in Africa.