Prime News Kenya

Tea farmers want KTDA to account for Sh649m dividend

Posted By : Justice Bimpeh

Small-scale tea farmers recently paid dividends by Kenya Tea Development Agency (KTDA) now demand to know the origin of the money, suspecting they might have been short-changed.

A lobby wants KTDA to explain how it arrived at the calculation of dividends and from which companies, saying most farmers were in the dark.

The Kenya Smallholder Tea Growers Association (Kestega) claimed that in the past, they were not paid dividends accruing from KTDA subsidiary companies.

The agency announced dividends of Sh649 million last month for the year ending June 2019, which it said were from its subsidiaries.


The agency made a profit of Sh2.8 billion last year, which was a 12 percent increase from Sh2.5 billion that it recorded in the previous year.

The subsidiaries include Chai Trading Company Limited, KTDA Management Services, Majani Insurance Brokers and Kenya Tea Packers Limited. Others are Greenland Fedha Limited, KTDA Foundation, Tea Machinery and Engineering Company Ltd and KTDA Power Company Limited.

But farmers said they were not aware how the companies were formed, how much was spent in establishing them and how much they have been making over the years. Kestega national chairman John Nteere said it was the high time KTDA came clean about these subsidiaries.

“Farmers were not even consulted before the companies were established yet they claim we are shareholders. How many shares does each of the 68 factories own in the nine subsidiaries and what is their value? We don’t know,” Mr Nteere said.

Mr Clifford Gikunda, a tea farmer in North Imenti said he did not know how the money he was paid was calculated, since it amounted to one shilling per kilo.


“We need to be told how the figures were arrived at because each farmer was paid according to the number of kilos they harvested over the past one year, which is not the value of shares. There is something they are not telling us,” said Mr Gikunda.

However, Mr Paul Ringera, KTDA Zone Seven chairman said they had been paying the bonuses over the years, only that they were not reflected in the farmer’s pay slips.

“At the end of each financial year each factory holds their own annual general meeting (AGM) when these dividends are declared but some farmers don’t even attend the AGMs,” said Mr Ringera.

The farmers also want the ministry to fast-track registration of the tea pricing committee that will take over sale of tea owned by small holder farmers at the Mombasa auction.

Known as the Dry Tea Pricing Committee, it was developed in response to directives that were issued by President Uhuru Kenyatta in January this year.

“We are aware that cartels in the ministry do not want it registered and we request the President to help farmers who have developed the constitution to actualize this committee,” Mr Nteere said, adding that the Tea Research Institute and Council of Governors among other stakeholders will be represented in the committee.

Agriculture Cabinet Secretary Peter Munya has published a raft of rules that if implemented will clip the powers of the KTDA in the management of factories.

The rules will strip KTDA powers to appoint factory directors, which has been done at the behest of the agency over the years, with the process being manipulated to appoint directors who play to the tune of KTDA in the management of the facilities.

Source : Daily Nation