A single auditor has been checking the accounts of some tea factories under the national agency for 15 years, contrary to laws capping the time to three years.
A report compiled by an ad-hoc committee of the County Assembly of Kericho said such unlawful acts compromise accountability of the (would be) farmer owned agency.
The report also cited under-representation at the Mombasa auction and the Kenya Tea Development Agency (KTDA) board for Kericho’s woes.
The 13-member committee chaired by Mr Gilbert Ngetich of Kisiara Ward was established in March to look into the challenges faced by smallholder tea farmers following unrest by producers allied to Toror factory demanding separation from the parent company Tegat.
“Tegat tea factory has been using one auditor for the last 15 years and now audits those of Toror as well,” said the report noting that each factory should appoint an auditor for a period of three years as required by the Companies Act 2015, to guarantee accountability and transparency .
The mandate of the committee included investigating the relationship between Tegat and Toror factories, requirements to make Toror autonomous, bonus variances paid by KTDA in the West of Rift (where Kericho belongs) and the East of Rift (Mt Kenya region) among other duties.
The team held consultative meetings with top officials of the market regulator, East African Tea Trade Association (EATTA), KTDA board, respective factories among other stakeholders in a bid to establish why the west of Rift farmers earn less bonus compared to the Eastern part.
Committee vice chairman Paul Chirchir said they were perturbed to learn that the entire team of 11 board members of EATTA was from the Mt Kenya region, known as the East of Rift, with none representing the west of Rift.
The team said their being sidelined from the decision-making cadres was a ploy to defraud farmers of good bonuses despite producing the same quality of tea.
They now want the number of zones to be reduced in the east or be expanded in the west for equal representation.
They further said: “The legislations that establish the offices of the directors be looked into so as to change the voting patterns to be one tea farmer one vote, and academic qualifications of directors be enhanced.
"The small holder tea farmer needs to have a say in the election of directors who are highly qualified for better representation.”
Growers have been pushing for an overhaul of the current system in which contenders with the highest shares automatically carry the director’s seat.
Tea from the region (Kericho, Bomet, Nakuru and environs) forms 60 per cent of Kenya’s total produce.
The committee said it wasn’t practical that all (over 20) Kenya Tea Development Agency factories from the region were processing low quality tea that occasioned poor bonuses.
They called for a scientific audit of the entire value chain.
Among measures recommended by the committee to overhaul the sector is to make autonomous the 11 tea factories in the west that still operate under parent companies.
The committee wonders why the east has only Kiegoi factory which is a satellite of Igembe factory, compared to 11 in the west, among them Toror, Chelal and Rorok.
“An assessment by the Tea directorate reveals that the processing capacity of factories in the west of rift is at 72 per cent and the optimal processing capacity is 80 per cent. This implies that we do not need as many satellite tea factories as the factory boards are propagating,” the committee said.
They also want KTDA managers not to overstay in certain regions or factory and that the number of directors is reduced at the factory level to minimise the recurrent costs while improving earnings by smallholder farmers.