Row simmering over cash crops levy

By Wainaina Ndung’u

A row is brewing in tea and coffee growing regions in Central between county governments on who would benefit from revenue generated from the cash crops. Over Sh1 billion is at stake.

The funds collected from two per cent levy on farmers’ earnings was at the centre of a row 15 years ago when leaders accused local authorities of failing to use the money for the intended purposes.

Then, tea and coffee growing regions access roads faced massive disrepair. Vehicles frequently stuck in the mud occasioning huge losses since farmers lost produce and had to foot high vehicle maintenance costs.

Facing protests, then Local Government minister Joseph Kamotho negotiated a formula for sharing the revenue, which entailed the councils getting 20 per cent of the cess while the other 80 per cent remained with farmers’ organisations.

“We were able to consistently use the 80 per cent of our share of revenue to maintain access roads while there is no evidence of councils having used their 20 per cent to help farmers,” said Gitugi Tea Factory chairman Peter Muchiri. At two per cent of farmers’ proceeds, the cess last year from a total payout of Sh45.3 billion to smallholder tea farmers totalled Sh906 million.  Shared at a ratio of 20:80, factories retained Sh724 million while councils raked in Sh182 million, most of which was not used for any purposes beneficial to farmers, according to their leaders.

Sources at Kenya Tea Board said large-scale tea growers contributed about Sh400 million with Sh320 million of that being managed by national Road Maintenance Committee constituted by Kenya Tea Growers Association.

Kenya Tea Development Agency (KTDA) chairman Peter Kanyago said the company’s board has advised its directors to consult with respective county governments in their zones about the issue. Speaking after consul tation with Nyeri Governor Nderitu Gachagua, Kanyago said things will become clear once the directors consult governors.

Requisite services

“I personally encourage people to pay tax. Only tax can enable a government to offer requisite services. Just look at what happened during President Kibaki’s tenure. He was able to undertake infrastructure projects because people paid tax,” he said. Nyeri, the zone that Kanyago represents at KTDA, has formed a committee comprising of regional roads manager and county government to deliberate on the thorny issue. According to KTDA Region 2 manager Josephat Michoma, Nyeri County has 880 kilometres of tea access roads reaching 199 tea collection centres serving over 34,000 farmers.

Most KTDA factories have in the last ten years purchased graders and undertake road repairs. Most of the factories have engaged up to ten full time road works personnel.