Directors of smallholder tea factories companies in Mt Kenya have raised alarm over resurgence of cartels in the sector.
The directors from Zones 1 to 7, claim the well-connected cartels are out to sabotage reforms the government has been undertaking to revitalise tea farming and ensure growers get value for their produce.
They claimed some individuals, who have been in the management of the tea sector, are after farmers’ money, which has increased thanks to the reforms.
The directors spoke at a meeting in Kenol town, Murang’a county, on Tuesday.
They were led by Gatundu South MP Gabriel Kagombe, who is also a director at Theta and Ndarugu tea factories in Zone 1 (Kiambu county).
They said through the reforms and proper management for the last three years, farmers’ earnings have grown from Sh43 billion to about Sh80 billion.
Kagombe said for the first time since the Kenya Tea Development Authority (KTDA) started managing the smallholder tea factories, farmers are expected to receive the biggest bonus in June this year. He said cartels are after the farmers’ money.
The directors also took issue with the Tea Board of Kenya (TBK), claiming it has started interfering with the affairs of KTDA-managed smallholder factories, which will in turn affect tea farmers.
They cited the resolution by TBK to oversee elections of the smallholder tea factories companies’ directors, saying elections should be done according to the companies’ Memorandum and Articles of Association.
“TBK has gone beyond its mandate as defined in the Tea Act 2020. The power to appoint and elect directors is purely a reserve of the shareholders and the boards of the respective tea factories companies,” Kagombe said in a joint communiqué by the directors.
“TBK is hereby put on notice to desist from interfering with the elections of smallholder tea factories companies.”
The directors also vowed to lead farmers in protests against a scheme to pay Sh560 million to lawyers.
Fourteen lawyers from different law firms represented KTDA Holdings, KTDA Management Services Limited and Kenya Tea Growers Association in two suits, where parties involved have reached a settlement agreement.
In one of the Nairobi High Court consolidated constitutional petition No E254 of 2020, KTDA Holdings Limited and 55 others had sued Agriculture Cabinet Secretary and 26 others demanding review of the Tea Act 2020.
In the second matter, Nairobi High Court consolidated constitutional petition No E016 of 2021, the Kenya Tea Growers Association and 55 others had sued the Attorney General and 24 others.
On April 2, 2024, TBK chairman Jacob Kahiu convened a mediation meeting between the parties. It was attended by the lawyers who came up with a mediation settlement agreement.
The parties agreed to withdraw all Court of Appeal proceedings arising from the High Court consolidated petitions. Also withdrawn were outstanding or pending applications, including the contempt of court applications.
A section of the agreement indicates that KTDA Holdings Limited, KTDA Management Service Limited and the Smallholder Tea Factories Companies managed by KTDA shall pay their lawyers appointed at various times.
“Farmers cannot and shall not be committed to pay law firms and advocates they did not give instructions to, and who were in court to fight against the farmers and their quest for justice. Sh560 million is not pocket change,” Kagombe said.
They warned KTDA Holdings management against paying the money without the farmer’s consent, threatening to take legal action should any coin of farmers’ toil be paid.
“If we find a coin missing, that it has gone to pay people we did not sanction, you’ll carry that cross as a person and we shall institute legal proceedings against you personally. Farmers’ money is sacred money, it’s their sweat and cannot be paid without their express authority,” Kagombe said.
Former KTDA chairman David Ichoho, also a Zone 1 member, claimed a few individuals are out to sabotage the earnings of seven million tea farmers.
He pleaded for government’s intervention, saying all efforts to revive the coffee sector risks going down the drain should the cartels be given a field day.
“We are set to pay out the biggest tea bonus that has ever been recorded in the last six decades. Yet, after all these efforts, some individuals have trained their eyes on the farmers’ basket. We won’t allow this to happen,” Ichoho said.
Gwaragwara Nkosi (Kionyo tea factory director in Meru) and Mithamo wa Susana (Ndima tea factory in Embu) called for government's intervention to save the tea sector.