Smallholder tea farmers affiliated to Kenya Tea Development Agency (KTDA) managed factories will this month receive Kshs 649 million from their tea factories, being dividends received from KTDA Holdings Ltd and its subsidiaries for the financial year ending 30th June 2019.
In a statement, KTDA says it has been accused of not giving dividends to factories and tea farmers from their investments in KTDA Holdings and its subsidiaries. “KTDA’s annual audited accounts indicate that dividends have consistently been paid to its shareholders who are the factory companies,” says the Agency. Agriculture CS Peter Munya has been leading the onslaught on KTDA accusing it of shortchanging tea farmers by not letting them benefit from the income from the various subsidiary companies it owns.
Even as it releases the dividends separately for the first time, KTDA still insists that over the last five years, factory companies have received more than Kshs 3.7 billion in dividends from KTDA and its subsidiaries’ business activities, the amounts having been previously consolidated.
KTDA says the tea factories, through resolutions of their directors, have resolved to pass the dividends received from KTDA holdings directly to the farmers who are the shareholders of the tea factories that own KTDA (H) Ltd. “The pay slips farmers will receive from their respective factory companies will now show the actual dividend payments accrued from the subsidiaries, separate from normal monthly payments for the delivery of tea,” says the Agency.
The subsidiaries are; KTDA Management Services that deals with the management of the tea factories, KTDA Power which is involved in power generation, Greenland Fedha which facilitates access to credit for farmers, and KETEPA, which is KTDA’s value addition arm that blends and packages tea for local consumption and export. Others are Chai Trading Company Limited whose mandate is warehousing, blending, clearing and forwarding, value addition, export and general tea trading; Majani Insurance Brokers which provides insurance brokerage services for tea factories and KTDA Group companies, Tea Machinery & Engineering Company Ltd – established to provide a modern workshop for fabrication and assembly of tea machinery for tea factories, and KTDA Foundation which focuses on corporate social investments.
The action by KTDA comes soon after the Agriculture CS released the final version of tea regulations which proposes an overhaul of the agency including an audit of its books and operations.