Plantation sector tea out-grower system

ABEYNANDA Dias

TEA: The Tea Plantations in Sri Lanka is categorised under two types of management systems namely estates (Large plantations) and smallholders.

Out of a total of 181,000 hectares, 58% comes under the management of large plantations whilst the remaining 42% falls into the smallholder category.

A study of the statistics of the national production level of tea reveal that the large plantation sector contributes 38% (1,370 kilos made tea per Hectare), whereas the smallholder contribution is 62% (2,607 kilos made tea per hectare).

From this, it is seen that the Large Plantation Sector is fast heading into a severe crisis due to their high cost of production, which results in their inability to invest no development programmes for the future sustainability of their sector.

This in turn will create very drastic effects on the massive work force of approximately 300,000 and their dependents numbering to as many as 1.2 million in the not too distant future.

Tea out-grower concept

The large plantation sector in Sri Lanka requires novelty and modifications develop and maintain its productivity in the current socio-economic context.

The introduction of the tea out-grower system to the tea industry is such a concept that will move beyond the traditional management system in tea plantations.

In order to develop this concept in to a result oriented one, the improvement of the livelihood of the worker is paramount and vital.

The writer has designed the out-grower concept for the first time where it was implemented in the plantations sector on 400 Ha. of tea lands on Pitakanda, Ratwatte, Elkaduwa, Hunugala and Selagama estates under the management of Elkaduwa Plantations Limited from January, 2005.

This initial programme involved the services of 400 families.

Proposed out-grower system

* The estate management will decide on the sections of land to be used for implementation of the model.

* All estate worker families (Tamils and Sinhalese) presently on the payroll will be given first preference to participate in the model.

* Land to be allocated only on long lease terms, subject to the balance lease period available to the company.

* Other than tea, on crops will be cultivated on lands identified under this model. The construction of buildings temporary or otherwise will not be permitted.

* Until such time as the land is sufficiently developed to earn its optimal income, the workers should be provided with a minimum umber of days of work per month to secure a minimum income.

* Estates will provide extension services to the communities, including material supplies, on a cost recovery basis.

* The green leaf harvested by the out-growers will be purchased by the Estate at price based on the Tea Commissioner's formula.

* The management will recover Rs. 1/- per kilo from the green leaf harvested as a royalty for the land ownership.

* out-grower will be provided with fertiliser and chemicals on a monthly instalment basis.

* All accounts pertaining to each individual out-grower will be maintained by the estate office.

* The allocation of land for each out-grower will be on the basis of either 01 Ha. or 5,000 to 6,000 tea bushes so as to enable him to obtain a reasonable harvest in order to sustain this concept.

This concept will encourage the community to take over the responsibility of developing and managing their given plot of tea land. This strategy will on one hand lessen their dependency on the estate for their livelihood whilst on the other it will develop their skills in managing tea lands.

This will result in an increase in the productivity of the estate that will in turn churn up enough profit to enable the company to transfer due benefits to the worker in reality, thus improving his living conditions.

(The current low financial status on plantations does not permit development or improvement of living and working conditions of the worker).

The aim of this project is to develop the institutional capacity of out-growers, where the worker as an individual will gather knowledge and experience in financial and resource management, thereby gaining dignity and self esteem among his fellow workers that will in turn improve his self confidence and motivate him towards self reliance.

Advantages

The extra income they earn will enable them to improve their standard of living. it is estimated that an individual will earn between Rs. 2,500 and Rs. 3,500 per month during the first four years.

From the fifth year onwards, their earning capacity will increase to between Rs. 4,500 and Rs. 5,000 per month.

This income will be in addition to what they earn by way of regular work on the estate.

The out-grower system will enable them to acquire the status and dignity of being a lessee of the land where they are able to resource and manage this land on their own. The additional income will help to improve the "material quality" of life.

(The writer is CEO, Elkaduwa Plantations)