Why the government wants to transfer KTDA ownership back to the ministry of agriculture

Why the government wants to transfer KTDA ownership back to ministry of agriculture

Mkulima today the  KTDA is a provider of comprehensive services to more than 600,000 small tea farmers. This includes services such as agri-extension, transportation, processing, and marketing. Is it time to transfer KTDA ownership back to the ministry of agriculture

There is a lot of talk at the ministry of agriculture, kilimo house on why the KTDA should be moved from private hands and back to the government.

With the tea reforms ordered by president Kenyatta and has been in development since 2014, it’s only a matter of time. This is all a matter of time.

Takeover and transfer KTDA ownership back to the ministry of agriculture

The government is already considering a full takeover of the KTDA and have it reverted to a state agency. This was confirmed by the cabinet secretary Peter Munya.

CS Peter Munya told the parliament that the cabinet led by the president that a cabinet memorandum has been prepared.

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The aim of this is to change the farm that is currently considered private to the public.

CS Munya also added that the organization is a public company having succeeded the defunct Kenya Tea Development Authority (KTDA) that was a parastatal at inception.

Legislation

All the company’s assets are government assets and the new assets owned by the agency were derived from farmers’ tea earnings. It is not a private company as some people might imagine.

Mr. Munya said this to the joint senate committee meeting during the consideration of the crops (tea industry) regulations of 2020.

The ministry of agriculture and the office of the attorney general is already working to legislation and is planning to table it to both houses of parliament for a legal opinion on KTDA future.

The origin

In June of 2000 the company (agency) succeeded the authority after its existence was revoked through a gazette notice.

The new private company or agency took over the assets, liabilities, obligations, and the mandate of the authority.

Since the agency took over the employees too, the government immediately lost control and say of over 52 tea factories currently under the KTDA and daily operations.

The Cabinet secretary also made it clear to the senate that over 70 percent of the KTDA assets were generated when it was a state agency.

With the new reforms in the tea sector, the government through the ministry is already taking back ownership of some parts of the tea industry.

Challenges

The government has already taken ownership of the Kenya Planters Cooperative Union (KPCU) where people thought it was a private company.

At the moment it is working on taking over the Kenya Farmers Association (KFA) though it is being challenged in the court of law.

In the past, the government has taken back former privatized companies like the New Kenya Cooperative creameries (New KCC), Kenya Seed company, and the now renamed Kenyatta International Convention center (KICC)

But for all this to work the cabinet memorandum will have to be supported by parliament in order to transfer the organization back to the government.

During the hearings, Senator Aaron Cheruyot asked the ministry to conduct a forensic audit of the agency but CS Munya responded that it could be done after adoption by the cabinet. He also asked parliament to start a process like that for the forensic audit.

This comes after several complaints from farmers and stakeholders about the KTDA.

The ministry is also hoping on reducing the management cost of the KTDA from the current 2.5 percent to 1.5 percent. This move will see farmers save over 900 million shillings a year according to the ministry.

KTDA is set to earn about 2 billion shillings this year and this process of reducing the fees will see the earnings drop to 1 billion shillings.

It seems the current reforms ordered by president Kenyatta will go along way to boost farmers’ earning and productivity.

let us make our tea and agriculture great again.

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