Small-scale farmers in South Rift region have rallied behind a Bill that seeks to amend the Tea Act, 2020 to allow for direct access to the export market and tax exemptions on value-added products.
The Tea (Amendment Bill) 2023, which is currently before the Senate and is sponsored by Mr Hillary Sigei (Bomet, UDA) seeks to address modalities of payment for over 600,000 small-scale growers who supply their produce to 69 Kenya Tea Development Agency (KTDA) managed factories across the country.
It seeks to address delays in price declaration and domination of the market by brokers.
It further seeks to entrench competitive marketing, allow packaging below 10 kilogrammes and give autonomy to tea factories, which are currently centrally managed from the KTDA head office in Nairobi.
The amendments propose to introduce the Direct Settlement System, a facility approved by the Central Bank of Kenya and which will be required to remit payments no later than five days after the receipt of proceeds.
“A stabilisation fund of 45 percent to cushion tea farmers during economic hardships should be created, and at least 50 percent of the total levy imposed on tea sales should be apportioned to infrastructure development in tea growing zones,” Mr Philip Kipngetich Ngeno, a lecturer at the University of Kabianga, said.
He made the remarks during a public participation forum, one of several organised by the Senate Committee on Agriculture, Livestock and Fisheries in Kericho and Bomet counties, at Motigo Tea Factory last week. The committee is chaired by Mr James Murango (Kirinyaga).
Mr Erick Langat, an ex-chairman of Kapkoros Tea Factory in Bomet County, said KTDA managed factories had weathered heavy losses since enactment of the Tea Act, 2020, which stopped direct sales and limited marketing to the Mombasa Auction.
The High Court in Bomet has since temporarily suspended this section of the law following a lawsuit filed by large-scale tea producers and multinationals under the auspices of the Kenya Tea Growers Association. Justice Roseline Korir said the temporary injunction would stand until a petition filed by Bomet Governor Hillary Barchok is heard and determined.
In the petition filed through Mr Sigei (in his capacity as an advocate of the High Court) Prof Barchok argues that the Act violates the distribution of functions between the national and county governments.
In the petition filed on March, 2, 2021, the Bomet County Government sought to challenge the constitutionality of sections of the Act that arrogate the Tea Board powers to dictate terms of payment in private contracts.
“We cannot, as a country, pride ourselves on having tea as one of the leading foreign exchange earners when small-scale farmers are underpaid as a result of skewed laws that favour brokers,” Mr Sigei said.
Mr Murango said the committee will incorporate the views of small-scale tea growers across the country as they “are major stakeholders in the industry”.
