State orders full settlement of tea bonus by July

Government has authorised that the full payment of tea bonuses should be done by July 10.

Agriculture Cabinet Secretary Peter Munya said moving forward no arrears will be carried forward into the next financial year.

On Friday, speaking at Thumaita tea factory in Kirinyaga, Munya told small-scale tea factory directors to stop hoarding farmers’ bonus until December.

He termed holding of farmers funds unhealthy for any institution as accounting books are normally closed in June in preparation for a fresh financial year. 

“Mini bonuses have already hit farmers' accounts however we want all bonus payment settled by July 10. It is wrong for tea factory to continually hold  payments because it does not incur any profitable interests to the farmer,” Munya said.

The CS said this year’s bonus is high because farmers produce had been bought at a good priced rate .

He said because of government’s intervention in designing a minimum reserve price at the Mombasa tea auction, farmers' payment will be high and motivating.

Early last month, Kenya Tea Development Authority said a total of Sh3 billion would be paid to farmers in form of mini-bonuses for the leaf sold between July 2021 to December 2021. The highest earners would receive Sh10 per kg.

This was an increase from from Sh5 per kg that the farmers got in 2020.

Munya also called on farmers to register their names at the county agricultural offices to easily access the subsidised fertilizers.

He said  the registration, would help rid of brokers who buy the product and sell it at at a higher price.

He said the fertilisers will be readily available at the National Cereals and Produce Boards depots.

“Farmers should register themselves to easily access the fertiliser.  Government has started dispatching  fertiliser which you shall buy at  Sh2,800 from Sh6,000," Munya said.

The CS also warned financial institutions against exploiting farmers by capping high interest rates on loans.

He said this had led farmers into unending cycles of poverty as they attempt to service the hefty loan .

“We cannot allow financial institutions to take advantage of our farmers. It is unreasonable for a farmer to borrow a principal amount of  Sh100,000 only for the sacco to demand for a full payment of Sh1000,000 in two months,” Munya said.

He said they shall send cooperative society auditors to such firms to find out if they have been cooking books.

(Edited by Tabnacha O)