The government has directed an immediate audit of loans taken by tea factories managed by the Kenya Tea Development Agency (KTDA) following widespread discontent among smallholder tea farmers over reduced bonus payments in the current financial year.
Principal Secretary in the State Department for Agriculture, Dr. Kipronoh Ronoh, confirmed that the Ministry had received numerous complaints from farmers dissatisfied with the low earnings. He said the review would seek to uncover the financial state of the factories and determine how the borrowed funds were utilised.
“These concerns have necessitated an in-depth review of the financial obligations and management practices within the factories,” Dr. Ronoh stated.
In a letter to Tea Board of Kenya Chief Executive Officer Willy Mutai, the PS instructed the board to conduct a comprehensive audit of all loans taken by KTDA-managed factories. The audit will establish the total amount borrowed by each factory, loan terms, utilisation of funds, and outstanding balances.
Dr. Ronoh emphasised that the audit findings will help the Ministry evaluate the financial sustainability of tea factories and formulate effective operational measures to address the challenges facing the tea sub-sector.
He further directed the Tea Board to commence the exercise immediately and submit a detailed report to the Ministry within 14 days. The directive was also copied to Agriculture Cabinet Secretary Mutahi Kagwe, Tea Board chairman Ndung’u Gathinji, and KTDA chairperson Chege Kirundi.
The order comes amid growing frustration among the over 680,000 smallholder tea farmers represented by KTDA, who have seen a significant drop in their annual bonus compared to previous years. The government hopes the audit will bring transparency and accountability to tea factory management and restore confidence among farmers.
