MPs fault tea agency’s push to stop new industry rules

Efforts by the Kenya Tea Development Agency’s (KTDA) to stop the implementation of new industry regulations through Parliament has been challenged after legislators failed to agree with their argument.

Appearing before Committee on Delegated Legislation, KTDA and other stakeholders in the tea sector presented their case on why they are opposed to the implementation of the new regulations.

However, committee members said the new set of laws, whose implementation has begun, have become popular with their constituents and that they are good for the sector.

“These regulations are good for the tea industry and they are very popular with my constituents and I do not see the reason why they are being opposed,” said Kirinyaga MP John Wambugu.

Funyula MP Wilberforce Oundo said the submission by the agency showed that they did not have a contingency plan for competition because of their monopoly status.

“From your presentation, it is evident that you are not ready for competition because of your monopoly” said the MP.

KTDA, through their lawyers accused the government of plans to ‘kill’ the agency by use of multiple regulations, saying the effects of these laws would “spill all the way to the farmers”.

“Some of these factories have loans and these regulations will impact negatively on repayment plans subjecting farmers to losses,” argued the lawyers.

KTDA, through a representative of one of the factories owned by the agency, also faulted the rule to have all factories sell their tea through auction saying some of the firms have contract with buyers abroad and that direct sales also helps in reducing the pressure at the auction.

Under the new regulations, KTDA will lose most of the powers it has over the 69 factories that it manages across the country, in far-reaching reforms announced by Agriculture Ministry.

The new laws also caps the management fee that the Kenya Tea Development Agency levies to farmers owned factories to two percent as opposed to 2.5 percent that the agency charges at the moment.