Connect with us

Business News

Why farmers are skeptical about revive of the moribund KFA : The Standard



In July, when President Uhuru Kenyatta directed Industry, Trade and Cooperative Cabinet Secretary Peter Munya (pictured) to restructure Kenya Farmers Association (KFA), farmers across the country were excited.
They hailed the move, hoping it would change their fortunes in the face of the high cost of farm inputs.
With 55 branches, and stockists spread across the country, the association was a leading distributor of farm inputs before it collapsed.

SEE ALSO :Blackface and tribalism: The demons that haunt modern politics

The association procured seeds, agro-chemicals and fertiliser in bulk and packaged them in affordable quantities for small-scale farmers.
Besides, farmers were allowed to take the inputs on credit and the money was recovered from companies and organisations that bought their produce.
Unfortunately, the association collapsed after years of mismanagement.

For More of This and Other Stories, Grab Your Copy of the Standard Newspaper.

Accumulated loans
Most of the debts KFA accumulated were loans that were advanced to organisations and individuals, not on the basis of creditworthiness but according to who they knew in the ruling class.
But farmers are now backing the government’s plan to revive the association.
Mr Kipkorir Menjo, one of the directors of KFA, captured the mood of farmers when he said the revival was long-overdue.
But five months down the line, the revival plan that started with the appointment of an interim board of nine to jump-start the process is not working.
The KFA caretaker board comprising Richard Mibei, Kipkorir Menjo, Simon Cherogony, Kinoti Kariithi, Benjamin Onkoba, Kirengei Kamau, Stella Karanja and Willis Oluoch has failed to agree on key issues that are crucial to revamping the association that collapsed more than 30 years ago. The Sunday Standard has established that even the composition of the board has been contentious since its inauguration in September.
A section of farmers are now questioning the legality of the caretaker board claiming that the association was still a private entity as par the last resolution of the Annual General Meeting in 2006.
According to some members appointed to sit in the interim board, KFA was to pick five members while the government four.
But the Cabinet Secretary through the Commissioner for Cooperatives picked five instead of four and went ahead to appoint an interim chairman to the board without consulting the KFA directors.
Five members of the board were made chairmen of various committees formed to look into issues outlined in the revival plan.
“The intention of the president to restructure KFA and revive it was good and meant well for farmers, but the imbalance in the appointment of board members is suspect,” said a member of the board who spoke on condition of anonymity.
Another bone of contention is the decision by the commission of cooperatives to remove signatories of KFA bank accounts and replace them with some board members.
Only the Managing Director Simon Cherongony was left as a signatory.
During appointment of the new board, Mr Munya directed them to clean-up the KFA members register, audit books of accounts after which farmers will elect new officials to fully take charge.
The CS maintained that the government’s intentions are good as KFA played a major role of providing inputs to farmers.
He, however, accused the current management of inefficiency.
contravention of rules
“The management of KFA failed to convene a general meeting contrary to Section 27 of the Cooperative Societies Act, failed to present audited accounts to the members, could not file annual returns with the commissioner of cooperative development.” Mr Munya told the Sunday Standard.
He claimed that the current management borrowed in contravention of the rule 34 of the Cooperative Act, disposed of assets without approval of members and incurred expenditure without approved budget.
The CS defended the appointment of the board saying it will restore sanity at KFA and put it back on track.
The interim board is mandated to conduct the affairs of KFA in accordance with the laws and regulations.
It is expected to verify assets and liabilities of the association, clean up the members’ register, review and amend the KFA laws and convene a general meeting to receive, consider and approve accounts and elect substantive board of directors.
But farmers are skeptical about the government’s intentions saying KFA was a limited liability company and not a cooperative.
Already two cases have been filed in court to challenge the government’s decision to restructure KFA.
In one of the cases that was filed at the High Court in Nakuru last week, members of the Trusted Society of Human Rights Alliance, Mr George Narok and Mr Paul Maina argue that KFA was a private entity and the government cannot influence the operations.
“We are seeking court’s assistance because the government’s action is illegal. KFA members should be allowed to elect leaders,” read their application filed in court.
A gazette notice issued on October 24 by the CS removed the organisation’s board and appointed a caretaker team.
In the suit, Mr Narok argues that the government removed the board of directors and appointed a caretaker one without prior notice and without consultations with the members.
This not the first attempt to revive KFA.
In June 27, 2003 the then Minister of Cooperative Development removed the KFA board of directors. The court later quashed the decision.
The association was incorporated in 1923 and was the distributor of farm inputs.
Wound it up
However, in 1984 the government wound it up and put in its place, the Kenya Grain Growers Co-operative Union (KGGCU), against the wishes of members. However, KGGCU failed miserably to meet farmers expectations.
The Kanu government changed tack and wound up KGGCU in 1996, reverting it to KFA which was a shell of its former self.
Mr Cherogony supported the government’s decision but said the intention of the Commissioner of Cooperatives has not gone down well with farmers.
“There are two cases already filed in court over the same issue. There was an order issued in a third case, which no one wants to obey,” he said, adding that they were  in the process of reviving KFA before the government came in and appointed an interim board.
“Members of the board of directors and I welcomed the government’s decision to restructure KFA but some of the issues have not pleased the farmers,” he said.
Mr Cherogony, who took over in 2006, said he has managed  to repay most of the Sh2 billion debt owed to creditors and they now have a debt of Sh800 million.
“Part of our revival plan was to repay KFA debts that had accumulated over the years,” he said.
He noted that they have updated the members register and they were in the process of working on the legal status.
Mr Menjo regretted that the collapse of KFA subjected farmers to untold suffering.
Mr David Korir, a member of KFA and a farmer in Nakuru, said over time the cost of farm inputs has sharply risen after unscrupulous businessmen took advantage of the gap that was left behind with the collapse of the association.
“When KFA was vibrant, farm inputs were available at affordable prices and it even extended credit facilities to farmers,” he said.
He is optimistic that plans to turn around KFA will greatly benefit farmers.
Korir noted that the association’s assets, including land and warehouses, are valued at more than Sh10 billion, unfortunately most of the assets were sold to repay debts amounting to more than Sh2 billion.

Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.

KFAUhuru KenyattaPeter MunyaFarmers

Source link