Deputy President Rigathi Gachagua on Wednesday said ongoing reforms in the tea sub-sector were bearing fruit citing improved bonuses for smallholder farmers this year.
The DP said the reforms he has been tasked by President William Ruto to implement in the subsector had led to increased final bonuses for thousands of farmers attached to Kenya Tea Development Agency (KTDA) factories spread across the country.
Speaking when he hosted KTDA Directors representing the factories at the DP’s Official Residence in Karen, Gachagua said they will push for better pay as the reforms are implemented.
“We are proud that within six months of the reforms, we are restoring sanity and stabilising the Tea Subsector as envisioned under the Kenya Kwanza Plan of putting more money in the pocket of the farmer. This is a direct positive impact to the farmer, who is at the bottom of the socio-economic pyramid. We are dignifying the farmer,” said the DP.
The Deputy President said the successful implementation of the reforms had been due to cooperation by the KTDA directors since the Tea Conference in Kericho last July.
“The players in the tea industry have embraced reforms. There has been no resistance. This is the fruit of embracing reforms. We will support KTDA to the hilt. A factory is as good as its directors. A factory is as successful as its leadership. You have proven through results that you are offering good leadership in the factories,” he added.
He added that they will continue to streamline the sub-sector in order to push the earnings higher up, promising to work closely with the directors to ensure the targets are achieved.
“We must push the bonuses even higher in the next five years. That is why we will follow up on implementation of the reforms to the last dot. A review of all legal, policy and regulative frameworks is ongoing for lasting reforms. I thank MPs and Senators for their commitment in supporting the reforms,” he stated.
In this year’s bonuses, Gitugi factory in Nyeri will pay the highest at Sh57 per kilogramme, followed by Imenti in Meru (Sh52 per kilo) and Michimikuru (Sh47/kilo), also in Meru. Momul tea factory (Sh44.8/kilo) in Kericho was also recognised for consistent higher pay to farmers. Nyankoba factory in Nyamira (Sh35/kilo) recorded the most improved pay this year.
As the farmers enjoy better earnings this year, the DP challenged KTDA to expand its markets internationally to ward off competition from other tea-producing countries and cushion farmers from probable shocks in the global markets.
“We will support you to look for markets for our tea globally. We must look for newer markets internationally because once we get good prices and new markets, the farmers will produce more tea,” he said.
The DP asked directors to set up lines for production of Orthodox tea which fetches higher prices internationally.
“Orthodox tea is the way to go. Its market globally is big. Factories should consider setting up lines for its production. We will support you put up the lines because the tea is more profitable. We want to make sure each factory produces orthodox tea,” he emphasised.
He said the government will work with the directors in the distribution of subsidized fertilizers in a bid to ease the cost of production in the tea farms.
The DP also said the array of court cases in which KTDA was entangled in was having a negative impact on farmers earnings challenging them to do away with them sooner.
“These cases are detrimental to the tea farmer because legal costs are borne by them,” he said.
Gachagua also asked the directors to reconsider supporting loss-making ventures under them and concentrate on profitable investments.
“I urge that we have an audit of all the KTDA subsidiaries. Those assisting farmers and making profits should be sustained and those making losses be liquidated. We want KTDA to leave the business of real estate, insurance companies and other investments and instead concentrate on the tea business,” said the Deputy President.
He also said the government will support the tea agency in the fight against tea poachers saying it was a criminal act that will not be tolerated.