The leadership wrangles at Kiru Tea Factory persist even after the contentious expiry of a 10-year contract with KTDA on June 30.
The contract detailed the terms of engagement between the factory and the Kenya Tea Development Agency.
The wrangles involve a faction headed by Chege Kirundi and another one led by Stephen Githiga. Each of them says he is the chairman of the tea factory.
Kirundi says the factory board should take over the management of the company following the expiry of the contract with KTDA.
The management problems started in 2017 when Kirundi suspended Githiga as a director after he became the CEO of Sasini company. His argument was that the appointment was in conflict with the factory's interests.
The board also sacked KTDA-appointed secretary John Kennedy Omanga and replaced him with Bernard Kiragu, after he complained that the board had not followed the right procedure in suspending Githiga.
This was opposed by the agency which supported Githiga. The board was henceforth split into two, with one endorsing Githiga as the chairman.
Kirundi, who is a lawyer, wrote to KTDA in 2017 seeking the renegotiation of the contract before it was renewed.
Kirundi claims KTDA refused to negotiate and insisted on the renewal of the old contract which he maintains is oppressive to farmers.
He says his board wants a contract that enhances accountability and transparency on how farmers’ money is spent.
“KTDA has closed all doors of negotiations for the last two years despite our willingness to sit down with them and negotiate,” Kirundi said at the county commissioner's office where the two factions were summoned over the stalemate.
He accuses KTDA of wanting to forcefully remain the manager of the factory.
“As the elected board, we have refused to agree to that. Either they agree to negotiate or we will manage the company ourselves,” he said, adding that the board wants structured negotiation.
He said under the old contract, farmers received Sh15 per kilo for 10 years. KTDA wants to increase it to Sh18, which Kirundi says is too little as Sh12 is paid to pluckers and the farmer is left with Sh6.
His belief is that the 8,000 farmers can be paid much more. “I expect that KTDA will see sense and agree to negotiate. There is still time but as of now, the factory is now being managed by the board and if something goes wrong, it is answerable,” he added.
Githiga said he renewed the contract early last year and the factory took a Sh100 million loan guaranteed by the agency to build a processing plant.
The plant processes about 10 per cent of the 25 million kilogrammes of tea produced by Kiru annually.
Githiga said Kirundi and his followers are only aggrieved because they are not recognised in the new contract.
He told those against the contract to seek legal redress insisting that his board is legitimate.
Githiga said farmers benefit more from the KTDA contract as they access subsidised farm inputs and short-term loans.
“The tea is also insured through a sister company of KTDA and any loss incurred during the transportation is catered for,” he said.
Farmers, he said, receive their monthly payments even before their tea is auctioned and that through the agency, tea factories access a centralised warehouse, marketing and administration which reduce the cost of production per kilogramme.
Edited by R.Wamochie
