Directors in the tea sector are opposed to the content of the Tea Amendment Bill 2023, which calls for the reduction of factory board members from six to five, the introduction of the Direct Settlement System (DSS), among other major concerns.
Other concerns include the factories being forced to register with the East Africa Tea Trade Association (EATTA) to access the Mombasa Tea Auction, as presently the factories are registered with the KTDA Management Service (MS).
The majority of the farmers call for the discarding of some amendments, arguing that if implemented would lead to increased taxation. and cause uproar in the multi-billion shillings industry.
The farmers support factories being managed by six directors, as has been the tradition, opposing the reintroduction of the reserve price, which they argue would lead to an increase in the commodity in the warehouses.
The farmers, James Mburu and Elijah Kurgat, ask KTDA Holding, chaired by Enos Njeru, to face the government to save the sector from being pushed in the corner and ensure the policies would benefit the sector.
They said it was disturbing that the clause to reduce the number of directors would harm the sector, despite the claim that the move would help the factories make savings.
Kurgat, a farmer in Kericho, said the government should focus on securing markets following the eruption of the Middle East crisis that has closed major markets in the Gulf and East Asia.
“The farmers call for the disbandment of the bill as it would cause sharp division in the small-scale holder factories that are not well-handled,“ said Kurgat.
Mburu said the Tea Board of Kenya (TBK) has failed to protect the growers' interests through irrelevant advice to the Ministry of Agriculture on policy formulation.
“Last year, various policies fronted by the regulator proved there were vested interests,” said Mburu.
Susan Nkirote from Imenti says there was a need to reduce the number of directors as the bill would streamline the sector.
“There are those interested in reducing the number of directors, but that can be achieved through the public participation process,” she said.
Eric Korir says the Tea Act amendment bill currently in Parliament was undertaken by a biased Government Reforms Committee, which turned out to be incompetent as it recommended the implementation of the return of the reserved price and ban on Direct sales.
“The bill is disastrous to the tea sector, as the return of the reserve price will lead to the buyers ignoring our tea stocks, as it was experienced two years ago, “said Korir.
Last week, Kangema MP Peter Kihungi, during the committee of the whole house, supported the amendment calling for the reduction of the number of directors by one, asserting he was out to protect the interests of the farmers.
“I argued that we ought not to burden farmers with the inclusion of many board members and costs,” said Kihungi during the televised parliamentary debate.
KTDA Holding Chairman Enos Njeru assures the farmers that they have engaged the legislative houses in various sittings, and presented their memorandums to the agriculture
“The directors have been lobbying to have some of the policies initiated in bad faith discarded,” said Njeru.
The directors of Gatundu South MP Gabriel Kagombe, John Mithamo Wasusan, and Gerald Ngumba last year said the introduction of the Direct Settlement System (DSS) was designed to cripple the factories financially.