Today was one of those days we have been dreaming of, from when we started advocating for changes at KTDA in the interest of tea farmers who have increasingly seen their fortunes dwindle in the hands of some KTDA directors and cartels.
CS Peter Munya, CS Agriculture, in his address today, made it very clear that the days of KTDA plunder are over. Actually, KTDA have been calling on his office for an appointment for the last 2 weeks and he categorically refused to grant them any meeting and a chance to bribe him.
All the issues we have raised herein before have been covered by the CS in the raft of changes that will be coming with the new regulations but of particular note, and summary, are:
- All teas produced in Kenya for the export market shall be sold exclusively through the auction process. Henceforth, sale by private treaty commonly known as Direct Sales Overseas is outlawed (CARTELS AT EATTA HAVE THRIVED HERE);
- All registered tea auction organizers shall establish an electronic trading platform for tea auction. This will create an audit trail and remove the opaqueness in the current trades. (EATTA WAS 2 YEARS AGO DIRECTED TO DIGITIZE AND TO DATE THEY HAVE REFUSED);
- All tea buyers shall pay in full for all teas they win at the auction before they take custody and lift the tea for export (BUYERS HAVE BEEN COLLUDING WITH KTDA TO TAKE FARMERS TEA ON CREDIT AND NOT PAY);
- A registered tea broker shall offer brokerage services to a maximum of fifteen (15) factories. (CERTAIN BROKERS OWNED BY DIRECTORS OFFER SERVICES TO ALL FACTORIES AND MONOPOLIZE AUCTION, THEREBY DISENFRANCHISING THE FARMERS);
- All monies from the sale of tea at the auction shall be remitted directly to Factory Accounts within fourteen (14) days from the auction date (KTDA COLLECTS FARMERS MONIES, PUTS IT IN POOL ACCOUNT, AND DEPOSITS IT WITH BANKS FOR INTEREST – LEADING TO CHASE AND IMPERIAL BANK FACTORY LOSSES OF 4.6BN. THIS PRACTICE IS ABOUT TO END);
- Factories shall within thirty (30) days from receipt of proceeds from sale of tea pay tea growers at least 50% of the payment for green leaf delivered every month (THIS IS JUST PERFECT! FARMERS SHOULD NOT HAVE TO BORROW THEIR OWN MONEY FROM GREENLAND FEDHA);
- The balance due to tea growers shall be paid by the factories within the financial or calendar year as shall be agreed with the farmers (THIS IS WHAT WE WILL NOW BE CALLING BONUS)
- Any management agency agreement between KTDA and a factory shall be for a tenure not exceeding 5 years. The remuneration for any management service shall not exceed two percent 2% of the value of tea sold per year (CURRENTLY IT IS AT 2.5% THOUGH THIS SHOULD EVEN BE AT 1%);
- Company secretary services shall be excluded from the services offered by management service providers and each Factory shall either recruit in-house company secretaries or outsource the service (THIS HAS BEEN THE UMBILICAL CORD THAT KTDA HAS USED TO CONTROL FACTORIES. THE COMPANY SECRETARY FOR KTDA HAS BEEN ALL POWERFUL AND HAS BEEN OVERSEEING 66 FACTORIES, MAKING HIMSELF THE LAW. THIS SHALL COME TO AN END);
The regulations will also seek to operationalize a stabilization fund to cushion farmers from price volatility, to find ways to improve value addition of Kenyan tea, oversee how Kenyan tea is marketed, among other possibilities.
Thank You CS Hon Peter Munya for following through with President Uhuru Kenyatta’s directives. We now look forward to receiving the draft regulations and giving our feedback within the stipulated time.