Finally tea cess funds for tea re-planting, factory up-grading

By Bandula Sirimanna

The government is to release Rs 450 million from tea export cess fund totalling Rs 1.2 billion for replanting and factory upgrading to meet international food safety standards following representations made by the Planters Association of Ceylon.

Cabinet approval has been granted for this purpose. The cess on exports of tea was increased in April 2006 by Rs 1.50 to Rs 4 per kilo, meant specifically for re-planting and factory modernization, Secretary General of the Planters Association of Ceylon. Malin Goonethilake told The Sunday Times FT. He added that the Association welcomed the move to grant this cess increase for re-planting and factory modernization purposes.

A senior official of the Ministry of Plantation Industries said cess funds collected on tea exports which are meant to be disbursed exclusively for industry purposes, will be put to best use in the context of the needs and the benefit of the industry. Enhancing productivity, promoting Sri Lankan owned brands, stimulating value added exports, facilitating food hygiene initiatives and supplementing research and analysis programmes are some of the plans.

Goonethilake said that the legislative and institutional framework of the tea industry dates back to the time of public ownership of plantations and is not responsive to the needs of both smallholders and privatized plantations.

The boards of the tea-related institutions lack private sector representation, he said, adding that these institutions are subject to the same control and terms of employment as in public agencies. Legislative changes and rationalization of the administrative expenditure will ensure efficiency of the institutions and allow more cess funds to be directed to replanting, he said.