Gender and social inclusion in Nepals tea sector

Kristie Drucza Gender and social inclusion adviser

June 2009

Background SNV Nepal has been working on developing the orthodox tea value chain since 2006. SNV has assisted to build the capacity of a number of actors associated with the orthodox tea value chain in four districts: Ilam, Panchthar, Dhankuta and Terhathum. SNV has a policy to mainstream gender and social inclusion in all its operations in all countries. SNVs gender and social inclusion (GSI) adviser for business development was requested to explore ways SNVs operations in tea could be more inclusive. To this end, field work was undertaken from 9 June 12 June in Ilam and Panchthar. A Questionnaire was developed for cooperative leaders, members and the Farmer Federation. A separate questionnaire was developed for factory owners and managers. A mix of focus group discussions and in depth interviews were undertaken. Purpose To ascertain how SNV could implement more inclusive working practices that promote governance for empowerment.1 Paying particular attention to: Landless seasonal Pluckers; Permanent farm workers; Pluckers with their own land; Existing groups (federations, cooperatives and informal groups); and Factories. Introduction Development interventions have a tendency to benefit the most educated because the costs of targeting the poorest and marginalized are deemed too high. SNV as a pro-poor organisation that mainstreams governance, gender and social inclusion (GSI) is committed to targeting the most excluded and vulnerable groups so that all people enjoy the freedom to pursue their own sustainable development. It is important for women and men and all ethnic and excluded groups to benefit equitably from development interventions. In some cases this may mean that it will be necessary to focus particularly on one section of society such as women or Dalits, in order to ensure that overall assistance benefits women and men equally. It may mean that capacity building efforts are required for marginalized groups before they are able to participate in mainstream development assistance. It may also mean that behavior change programs are required for men or upper caste members of society so they can create space for, and allow, traditionally marginalised2 groups to equally participate in development. In a nation, such as Nepal with low gender and social inclusion indicators 3, it is not sufficient to target men and women in the same ways or even to the same degrees in pursuit of equitable pro-poor development objectives. Women, men and excluded groups have unique needs. They are not a homogenous group. Equality does not always mean treating men and women and other excluded groups the same. Gender is not synonymous with women; everyone has a gender. Gender involves social and cultural relationships that are changed and formed over time. Gender is a social construct; sex
1

Governance for empowerment (GfE) is SNVs approach to mainstreaming governance and has 5 principles: effectiveness & efficiency; Equity & inclusiveness; Rule of law; Participation & responsiveness; Accountability & transparency. 2 Traditionally marginalised groups are defined as: the poor, women, ethnic groups, and lower castes . 3 Nepal ranked 86th out of 93 countries in the 2007 Gender Empowerment Measure (GEM), with a value of 0.351. In terms of the four districts associated with SNVs assistance in tea, Dhankuta ranks 16 th on the GEM out of 75 Districts. Terhathum is 33rd, Ilam is 34th and Panchthar ranks the lowest at 43. See Appendix 1 for more information. For inclusion statistics see 2008 Village Development committee Profile of Nepal: A socio-economic development database of Nepal.

is a biological function. Nepal experiences group violence, riots and regular bundas (strikes) that disproportionately involve (young) men. This is also a gender issue. While womens empowerment and gender equality are inextricably linked, gender is more than the common assumptions associated with the concept of woman. Gender equality relates to equality of outcomes which are not based upon ones sex but rather the equal treatment of men and women. Promoting equality involves recognition that men and women have different roles and needs and these are factored into development programming and planning. Discrimination based upon gender affects both women and men adversely. Men when prompted will sometimes discuss their secret stress and the burden they feel from being the main bread winner. In Nepal all statistical indicators (See Appendix 1) suggest that women are overwhelmingly more disadvantaged than men and therefore prioritizing strategies that advantage women is justified until these statistics change. Gender inequalities can and should be changed. Equality of opportunity is a basic human right established by international agreements and conventions such as the ILOs convention 111 and 100 and the 1979 Convention on Elimination of Discrimination Against Women. What these conventions illustrate is that gender inequalities cannot be justified by reference to cultural norms.4 Additionally the 1990 constitution of Nepal says that there shall be no discrimination against any citizen in the application of laws, or on the grounds of religion, caste, race or sex. It also requires that employers pay women equal wages with men and give women equal access to property. Other laws have also been passed to provide special provisions for women's education, health and employment.5 Gender mainstreaming is a globally accepted strategy for promoting gender equality. Mainstreaming is not an end in itself but an approach to achieve the goal of gender equality. Mainstreaming involves ensuring that gender perspectives and attention to the goal of gender equality are central to all development related activities. A combination of approaches are needed to effectively mainstream. For example, targeted programs, gender analysis, gendered strategies, gender indicators, sex disaggregated data, etc. SNV Nepal also mainstreams social inclusion and governance. Nepal has some unique development challenges as a post conflict society with the Hindu caste system and a newly emerging democracy. Governance for empowerment (GfE) According to SNVs website; Governance is at the heart of our work and cuts across all that we do. Good governance principles like participation, transparency and accountability, guide our work. Governance for empowerment is the concept we use to underscore the value we place on gender equity and social inclusion of poor and marginalised groups as the basis of sustainable development. SNV focuses on 5 dimensions to mainstream governance: Effectiveness & efficiency Equity & inclusiveness Rule of law Participation & responsiveness Accountability & transparency Nepal has been a feudalistic state the only Hindu kingdom until recently. The process of parliamentary politics was reintroduced in 1991 after years of monarchical rule. Since 1996 violent unrest has plagued Nepal. In 2008 a coalition was formed with Maoists at the helm as a result of democratic elections. This changed again in May 2009 when the Maoists stepped
4

Mayoux and Mackie 2007. Making the Strongest Links: A practical guide to Mainstreaming Gender analysis in VCD. ILO. 5 http://www.nepaldemocracy.org/civic_education/civics/civicedu_chap6.html#place

down from power. Regular changes of government are common in post conflict countries struggling to understand concepts of good governance and democracy. Aside from at the central level, it is also beneficial to promote good governance at the local level within local institutions that people see and encounter daily. When people understand the principles of good governance and put them into practice, then they are more likely to hold their central government to account and demand stability. They are also more likely to practice good governance in their everyday encounters. Social exclusion is a process and a state that prevents individuals or groups from full participation in social, economic and political life and from asserting their rights. It derives from exclusionary relationships based on power.6 Nepals ten years of conflict can be regarded as a result of social exclusion. For this reason inclusive activities and targeting can be regarded as addressing the root causes of Nepals conflict and promoting peace, and should consequently be a mandatory requirement for all development assistance in the country. Social inclusion is a strategy that actively seeks to ensure development outcomes consider the unique needs of the poor, ethnic groups, lower caste groups and women. Generally men and upper castes are dominant in Nepal and require different levels of assistance from excluded groups. Empowerment builds peoples assets and capacity to gain understanding and control over personal, social, economic and political forces to act individually as well as collectively to make choices about the way they want to be and do things in their best interest to improve their life situation.7 Discussion and main findings Empowerment of poor producers in the tea value chain is a key objective of SNVs work. According to SNVs website, we are in a chain not for the product but to help poor people increase production, employment and income. SNVs assistance is based on the knowledge that successful poverty reduction depends upon the eradication of economic and social disadvantage, and the promotion of pro-poor solutions. 8 So the main beneficiaries of SNVs capacity building assistance are the poor and disadvantaged involved in the tea sector. In tea the poor and disadvantaged are those who are landless and often work as seasonal labours and pluckers on other peoples land. These people are often lower caste, women and sometimes from ethnic groups. Tea is not an untouchable crop. This means even Dalits can be involved in the growing, harvesting and processing of tea. The next poorest groups are pluckers and farm labourers who have small plots of land and then factory workers, small holder farmers, larger landholding farmers and then factory managers and factory owners. Within these categories there is also inequality associated with the caste system, gender, age and ethnicity. Some of SNVs targeted beneficiaries are missing out on assistance. This is a result of unequal social relations that are replicated within the tea industry. In tea districts (and Nepal) upper caste males are more likely to hold management positions in cooperatives and factories and own larger plots of land than Dalits, female headed households and ethnic groups, although some upper caste families can also be poor. It is difficult for SNV to rectify this situation as it does not work directly with the poor and because upper caste males are more likely to effectively negotiate better terms and conditions of employment and higher prices for tea due to language and ease of building rapport with other upper caste males. Nonetheless, SNV has made some commendable attempts to include GSI in its programs and assignments. For example one of SNV advisers ensured that the recent recruitment of social
6 7

DFID 2005 DFID Social Exclusion Review. UNDP HDR 8 www.snvworld.org

mobilisers for client Teasec had equitable representation of marginalized groups, including women. The approach of encouraging equitable representation, participation and access for marginalized groups and women should be done across all programs and assignments as a core mainstreaming strategy. Collecting sex, caste and ethnicity disaggregated data is another effective way to mainstream. The capabilities of women and marginalized groups often lag behind their opportunities. Enabling women and marginalized groups to realize their full potential requires removing inequalities and discrimination which constrain them at every level of the value chain. They often require additional encouragement and opportunities (known as affirmative action) to enable them to rise above internalized and external subordination. They will not just take opportunities or benefit from value chain development to the same degree as more advantaged and empowered groups. It is easier to target more empowered and higher educated groups. However, if information and new technology associated with SNVs assistance continues to disproportionately target upper caste men then the tea value chain will perpetuate inequalities. Men will increase their knowledge, power and advantage in markets and employment and women and other groups will increasingly be marginalized and disadvantaged. This has implications not only for equality and the marginalized groups but also reduces value chain effectiveness, economic growth and perpetuates cycles of poverty. Until recently people thought only men were heads of household and women did not need to worry about income. However, in modern Nepal there is a lot of migration for employment and this involves more men than women resulting in a number of female headed households. While a number of migrants send remittances this creates dependency that may not always be fulfilled. Women need to be economically independent if they are to prosper in a globalised economy. Creating space for marginalized groups to benefit equitably from value chains requires an improvement in governance practices. Transparency and accountability lead to greater information flows. Democratic leadership leads to power sharing and capacity building of marginalized groups. The below sections discuss some entry points for SNV to consider in future programming from a GfE perspective. FARMER, PLUCKER AND LABOUER CONCERNS The fieldwork found three main concerns for farmers, Pluckers and factory workers: Health Access to finance Income in the tea off-season (Dec March) Key informants report that Pluckers, factory workers and farmers who use pesticides have poor health as a result of their working conditions. The number one reason farmers miss cooperative meetings are due to illness. Factory workers also expressed concern over their health and requested any assistance possible. Some form of micro health insurance could be explored as poor health and absenteeism reduces tea productivity and pushes the poor into destitution. SNV could undertake research on micro health insurance and what options exist for tea labourers. This could be a potential Inclusive Business opportunity. Factory workers specifically asked for small business training so they can still earn money when the factory is closed. Linking or promoting entrepreneurial skills development in tea districts will help micro entrepreneurs in the off-season, enhance the business acumen of tea actors and offer more services to the tea industry. It will also assist farmers to access finance as discussed below. All the farmers interviewed complained about the lack of finance available for them to improve their tea farm. Farmers wanted money to build new sheds, inputs, improve their production and invest in organic conversion. They feel that finance is a barrier to the growth of their tea

farm and the tea sector. In my experience it is not often access to finance that is the real problem however. The problem is that farmers do not want to pay high interest rates and they lack the business acumen to be given finance by commercial banks. Greater access to finance could be achieved by partnering with financial institutions, understanding their concerns about lending to farmers and informing them of farmer needs. When cooperative farmers are informed and linked with finance institutions, they will have a greater opportunity to access a cooperative loan for more investments in their business. Some form of Inclusive Business with a financial institution that includes business skills training for farmers including business plan development and financial management would be beneficial. Women workers (Pluckers, factory workers, labourers) are only paid USD1 per day during the tea season. The minimum wage (110NRP USD1.44) is a component of the code of conduct (CoC) which brings labourers over the poverty line of USD1.25 - a tremendous impact if only more factories had signed CoC. However, these figures do not account for the nonemployment during the tea off season. If combined with an additional income source in the off season, women Pluckers and factory workers have the potential to reach USD2 per day. This has the potential to bring around 15,000 Nepalis (the estimated number of labourers involved in orthodox tea) out of poverty - a very significant pro-poor development impact directly relevant to MDG1. MONITORING AND INCENTIVES A number of SNVs clients and tea actors have a lack of awareness about monitoring and evaluation. They plan with little reflection on achievement and lessons learnt. When asked how the Farmer Federation monitors performance according to their strategic plan, the given answer was through observation. There was no formal monitoring or performance appraisal process in place. During the research, statements from clients included I think or we try to without substantial evidence or reports available. The culture of reporting and the ability to demonstrate effectiveness is illusive, especially from a GSI perspective. People often need to see the results or benefits of mainstreaming GfE for them to embrace the issues whole heartedly. This is not currently possible as there is a lack of focus on results and collecting disaggregated data. Measuring results will demonstrate areas where the client could improve. SNVs capacity building assistance would be well placed to address this issue. It was apparent from the researchers questioning that some of SNVs clients do not understand mainstreaming as a strategy. There was a difference of opinion between clients with some not agreeing with the approach; in the last 45 years women have changed so much. When I was at high school there werent any girls. Now there are lots. Things are changing but it should be slowed down. Things are moving too fast. Women want too much. Another person who worked for the same client asked cooperatives to re-nominate their representatives to the Farmer Federation and to consider their female members as representatives. This led to 6 females being nominated which is a great result especially considering the first round of nominations only had male nominees. Assisting clients to understand mainstreaming and collecting and promoting good practice examples of GfE would be advantageous. This could be done by training, closer capacity building and specifying GfE in assignment agreements. Additionally, SNV could structure its support around incentives. SNV is working with a number of organizations to develop business plans and yet SNV practices are not aligned with the private sector. SNV dispenses funds to clients regardless of performance. SNV could consider using its assistance to leverage more effective and accountable behaviour change with GfE results. Performance based payments could be implemented and a proposal to this effect is with SNVs management team. OUTREACH SNV and Agriterra have done some great work in mobilizing farmers into cooperatives. The cooperatives have empowered farmers to secure better prices and transportation for their tea. In some cases cooperatives also have better access to services. For example a number of

cooperatives sighted receiving training from the Ilam Farmer Federation, Teasec, factories or NGOs (NCDC in Ilam is currently giving organic farming skills training). However, there are cooperatives that do not receive any assistance. One farmer explained that he didnt know where to go for help and there was no management that gives training to farmers. He mainly gets information from his friends. He said sometimes people come back from India with new knowledge. Another cooperative didnt know there was a Farmer Federation but wanted to know how his cooperative could join. There are also farmers who are not in cooperatives and who do not receive assistance. There are currently 44 VDCs in Ilam who process tea and only 28 of these have tea cooperatives formed. 16 VDCs with farmers not in registered cooperatives and these VDCs are more remote. It is difficult to mobilise groups that are geographically dispersed, remote, poor and uneducated. Yet geography constitutes a critical part of many peoples experience of poverty. SNV, as a pro poor organisation, could encourage clients to have greater outreach and to prioritise the needs of the poor. FARMER FEDERATIONS Ilam is the only district with a Farmer Federation and SNV is working to establish federations in other districts. Federations represent farmer needs and offer more bargaining and lobbying power at policy levels. They also offer an opportunity for networking and information dissemination and should be supported. Lessons from the Ilam Farmer Federation suggest the need for more capacity building support to federations so they can more effectively lobbying government, bargain with buyers and offer different training programs for farmers. A representative of the Ilam Farmer Federation commented, the Federation is in its early stage and isn't strong but tea farmers expectation is high. The Federation can't full fill their expectation that is the biggest challenge. We need help with market access, information and industrializing professional tea farming. Some lessons can be learnt from the Ilam Farmer Federation: Greater networking and information dissemination. Most of the cooperatives the researcher met with were hungry to be involved in consultations and strengthen their knowledge networks. The Farmer Federation could promote more networking between cooperatives and not just the representative members of the Farmer Federation. Widely disseminating market information and trends could be encouraged. Strengthen service delivery. The Farmer Federation could offer more services to members by collaborating with Chamber of Commerce, other businesses and NGOs who offer training. They are trying to do everything themselves rather than facilitating and coordinating with other service providers. COOPERATIVES Cooperatives are beneficial in securing more income for farmers by increasing their bargaining power. One cooperative chairperson explained, we started a cooperative because one of our friends was in one and he said they got a better price for tea. So we copied their idea and formed our own cooperative. We immediately got 16NRP more per kilo. This cooperative was formed without assistance from SNVs clients and illustrates the ripple effect capacity building can have. SNV could capitalize on formed cooperatives for greater development gains. SNVs clients could assist to organize more formal networking opportunities for cooperatives where lessons learnt, challenges and market information is shared. It would also be advantageous to invite NGOs and researchers to these networking meetings. Some agricultural research sits in universities without dissemination to those who would most benefit and a number of NGOs deliver training programs on a wide variety of development topics. 9
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NGOs that discuss how to address discrimination through affirmative action and how this reduces household and community poverty or discusses development losses due to domestic violence would maximize development gains from cooperative formation.

The governance and formation of cooperatives could be strengthened. During the research there was no evidence of anonymous voting for executive committee members and information dissemination to non leaders appeared poor. Transparency and accountability could be strengthened as one informant could not tell me how the treasury is spent or who determines this. Another member thought people were punished if they didnt attend meetings but didnt know what that punishment was. In one cooperative group only 2 of the executive members had read the cooperative ACT and the other members were unsure what it was. This illustrates the need to strengthen the governance and leadership of cooperatives. Cooperatives are prone to elite capture. Some cooperatives hire people to sell their tea and manage the treasury. These employees are often from executive member families. Members who were politicians or village leaders were reported as the most challenging cooperative members as they always wanted their opinions or ideas implemented. Some cooperatives discussed strategies to mitigate these big personalities by encouraging a broader range of members to speak but some cooperative chairs were unsure of what to do about this inequity. Facilitation and leadership skills are required. The Farmer Federation and Teasec would benefit from understanding the multi layered power relations that poor and excluded groups confront in their daily lives and how these power relations play out in cooperatives. A train the trainer leadership for change program would assist but this will not occur before 2010; meanwhile Rudra Sapkota (SNV governance adviser) could give power analysis training and offer techniques on facilitation skills to encourage others to speak. Cooperatives could also benefit from more bargaining and negotiation training. As one farmer explains, Our buyers are the most difficult people to deal with. Sometimes they dont pay on time or pay what they promised. Bargaining and negotiations skills are key entry points for womens empowerment. Women often lack experience in negotiating favourable outcomes, especially associated with their caring responsibilities. Women work triple roles as paid employees (productive), caring (household chores, firewood collection) and reproductive (childcare, maternity). Learning to negotiate ways to have these duties more evenly distributed (where feasible) among household members would go some way to increasing womens life expectancy.10 Cooperative groups are generally formed around market access. As one cooperative member explains, A factory will send a vehicle to collect a bulk amount of tea and so we formed a cooperative for this purpose. So farmers who are in close proximity, selling to the same factory or have committed to the code of conduct for tea (CoC) or organic agriculture form a cooperative. According to one key informant, some farmers are not in groups. Especially those that sell at the local market, or who live close to a factory, or who are planning their own factory and those who are in remote areas. While this makes sense, cooperatives serve a larger purpose than just market access. They also provide information, technical support and a networking opportunity to farmers. The same informant articulated that the farmers outside cooperatives are poorer to a certain extent than those in cooperatives because they have little bargaining power over price. A targeted program in 2010 could be to research the poorest farmers and assist them with cooperative formation. Sometimes farmers excluded from cooperatives request training from Teasec. Teasec explains to farmers that they need to be in a cooperative to receive training and Teasec suggests that they start a cooperative and then Teasec will help them. For many farmers forming their own cooperative is unrealistic. Perhaps they do not live near farmers with similar size plots or cannot afford certification. Or perhaps they do not know other farmers not already in a cooperative and they cannot join the one closest to them. This policy of Teasecs could be
10

Nepal is one of the few countries in the world where womens life expectancy is lower than mens. See UNFPA Gender Equality and Womens Empowerment 2007.

changed so that all farmers, especially the poor, can benefit from Teasec and other forms of service delivery. MARGINALISED GROUPS AND WOMEN IN COOPERTAIVES AND FEDERATION There appeared to be a lack of understanding about cooperative practices and participation by female members. One member of the Farmer Federations said it is difficult to get women to be active because they are too busy with the household or childcare. None of the cooperatives talked about organizing meetings at times appropriate to women, shifting the meeting venue closer, or allowing children to be brought to the meetings. Some of the women interviewed had never read the Cooperative Act and many could not explain the cooperatives governance arrangements and management practices. GoN has mandated 30% female members in order to register a cooperative which is commendable. Most cooperatives meet the bear minimum number of females required for registration. However, many females are token members and infrequently attend meetings. One informant explained that most of the female members were farmer wives or teachers who were not fully engaged in tea. Their name was on the list for the purpose of cooperative membership requirements only. SNV could assist Teasec to promote meaningful and active female participation in cooperatives. Currently only one cooperative has a female chair. This cooperative has the highest number of active female members at 48%. The women in this cooperative are not just token figures like in other cooperatives. They are actually empowered to speak out and attend more meetings, illustrating the impact a female chair can have as a role model and motivator for other women. Promoting female leadership is crucial for equality and participation of other women. The same arguments apply for promoting marginalized groups into leadership positions. It was reassuring to discover that most cooperatives had some ethnic groups and Dalits as members. However, closer inspection revealed that very few of these marginalized groups were elected to be executive committee members. For example the Farmer Federation has 5 Brahmins, 2 Chetri, 2 Rai, I Newar, 1 Gurung and 1 Magar and no Dalits. Only 2 of the 13 members are women and only 3 of the 13 members are from marginalized groups. These members are nominated by cooperatives. Evidence shows a critical mass of one third is needed for marginalized groups to find their voice and feel empowered to be active members. More encouragement and promotion of marginalized groups and capacity support to ensure they are active participants is needed in cooperatives. YOUTH Very few young people or people with a disability are involved in Farmer Federations or cooperatives. Young people and those with a disability are often excluded from cooperatives because they do not own land. Interested local youth could be given intern opportunities at the Farmer Federation, HIMCOOP, HOTPA and Teasec. Their assistance to cooperatives could also be invaluable as the younger generation is more educated than their parents. The promotion of youth internships, especially if connected to university degrees in agriculture, will assist Teasec, HIMCOOP, HOTPA, federations and cooperatives with their outreach and effectiveness. The role of people with a disability in the tea industry requires further study. FARM LABOUR Pluckers require more training on plucking according to farmers and factory owners who are increasingly concerned by the slow, poor quality plucking. One farmer explained that I dont know what makes a good Plucker so I cant teach my Pluckers. The factory always complains about the quality of the leaf so I know its a problem but what to do? No one trains Pluckers they teach each other and some are slower than others. Pluckers also do other farm work such as weeding and pruning. The farmer did not know how to motivate Pluckers to be more productive or more reliable as frequent sick days were a problem. The farmer was unaware of where to go for training in plucking techniques. There appears to be little attention to this sector of the value chain.

Many stories were heard about the challenges and demand of plucking. Unfortunately the researcher was unable to interview Pluckers directly. Plucking is a difficult job and apparently normally done by poor lower castes. People pluck to survive. Factories with gardens and farmers confessed that they do not pay Pluckers the minimum wage. Pluckers have regular sick days and suffer a number of health consequences from working in tea such as strain on the neck and cervical spine from carrying the tea basket, abrasions to the hands and prolapsed uterus. One factory manager told me Pluckers bring political problems to work. The social issues associated with bundas can be brought to the field and cause problems between workers. It is estimated that 10% of the total labour force on Nepal tea farms is composed of children between 8 -15 years of age.11 While this is discouraged in the code of conduct it is not enough as many factories will not commit to the code. There is a shortage of labour available for tea and many youth 18 24 appear disinterested in working on farms according to farmers and factories interviewed. It would be beneficial to explore the feasibility of an association for Pluckers. Currently farmers have problems sourcing good reliable Pluckers and training for Pluckers. A Pluckers association could be a service provider to farmers that trains and maintains a database of potential high quality Pluckers. Additionally, the association could lobby for better worker rights and promote better occupational health and safety practices for Pluckers. There is need for more research into the lives of Pluckers and what is required to increase productivity and cooperation. The average amount of tea plucked per day in India ranges from 20-28 kilograms.12 According to one farmer his pluckers pluck between 15 20 kilograms per day and this is decreasing with organic conversion. Further discussion about these issues occurs in the productivity section. FACTORYS Factories appear to have a diverse workforce, although there are clear gender roles. Women work in low paid, repetitive labour intensive tasks, while men hold leadership positions. Factory owners and farmers admitted that women are not often offered higher paying jobs in the factory or on the tea estate so their access to more lucrative employment is limited. This is the same for lower castes. Most factory and garden supervisors and managers are upper caste males although there are exceptions. Factories say this is because women and lower castes are illiterate and cannot keep the records required of a supervisor. 13 The governance and human resource management within factories could be improved. Factory workers and owners reported that there were no options or provisions for women when they became pregnant. Women just quit at some point during their pregnancy. Holiday and sick pay appeared to be paid although not all workers have formal contracts outlining terms and conditions. Everyone receives the same Hindu public holidays regardless of religion and a Hindu temple is on sight at most factories. Consideration of other religions could be strengthened. The minimum wage is not paid in all tea factories but apparently men and women receive equal pay for equal work. This is surprising given women earn about four fifths of what men earn in the agriculture sector (NLSS, 1995/96). Perhaps equal pay for equal work is more of an issue with informal employment on farms. There is varying degrees of informal social dialogue between workers and managers but no formal feedback or grievance processes in place. Some union negotiation has occurred but unions are regarded as over politicized and trouble makers by some of the factory owners interviewed. A number of factories have had their doors closed due to worker protests. Workers maybe confused or unsure of their rights because factories comment that they make unrealistic demands but this requires further exploration. Putting the code of conduct on the
11 12

See ILO 2002. Labour and Social Issues in Plantations in south Asia: Role of Social Dialogue, p58. See ILO 2002. Labour and Social Issues in Plantations in south Asia: Role of Social Dialogue.

13

The overall literacy rate of Nepal is 52.74 percent but the female literacy rate is only 42.49 percent (CBS, 2001).

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wall of factories and outlining the labour laws would be a useful accountability mechanism. Factories appear to offer little incentives or consideration of workers or suppliers. One farmer said all factories do is complain about the tea they bring and try and get the cheapest price. The relationship between farmers and factories was acknowledged by most interviewees, including Teasec, as a problem. Some factory owners even alluded to these tensions. Better communication and multi stakeholder dialogue along with more formalized staff and management feedback mechanisms could assist to improve these tensions. Heath and safety is another issue requiring focus by factory owners. There were reports of open defecation and access to clean drinking water is doubtful although it requires closer inspection. The use of protective clothing especially when using pesticides is another area for concern, especially on smaller farms. During interview a number of factory owners had to ask what are health and safety issues? their reply was along the lines of Im sure we do whatever the government says we should do. Some factories have terrific practices in place. Kanchanjangha Tea Estate has on sight accommodation which is largely taken by the landless or those who live far away. They have a committee that discusses the welfare of workers and they have a small fund to manage for community development activities. They pay the salary of a school teacher and the school fees of all their staff. They offer 45 days paid maternity leave and allow the husband or child (if older than 16) to work in her place if she needs extended leave. This factory has fair trade certification and consequently has the best labour standards. Jun Chiyabari Tea Estate gives scholarships to female students at the local school. They also actively encourage and train women into leadership positions and have discovered ways to mitigate illiteracy challenges. However, neither Tea Estate pays the minimum wage. SNV is well placed to document some of the good practices of orthodox factories and include them as minimum standards in the code of conduct manual. A lesson from India is that successful companies with high proportion of labour owe their success to the level of recognition and motivation they have given to their workers by providing them with enhanced responsibilities, participation in profit sharing and opportunities for promotion.14 SNV could do more to enhance the labour standards and human resource practices within factories. CODE OF CONDUCT Only a couple of factories are CoC certified. According to one factory owner, I refuse to pay for CoC because the audit process is not well established and there is no ownership by HOTPA. If you want my honest opinion it is donor driven and I can think of better ways to spend my money. In an African study on codes of conduct the best auditing process was a participatory multi stakeholder review.15 A participatory approach puts greater emphasis on involvement of workers and workers organisations in the process of code implementation and assessment. It is based on developing partnerships between different actors (companies, trade unions, NGOs and preferably government) in developing a locally sustainable approach to the improvement of working conditions. This approach is sensitive to uncovering and thus addressing more complex issues such as gender discrimination and sexual harassment. These are issues more likely to be experienced by insecure non-permanent workers, who are often women, whose voices snapshot audits usually fail to pick up. 16 This would be a useful approach for SNV to explore with CoC auditing given the low capacity in HOTPA to adequately audit CoC. LANDLESS Anecdotal evidence during the research suggested that landlessness is an issue for the most impoverished in the tea sector. They have no ability to improve their assets and little
14 15

See ILO 2002. Labour and Social Issues in Plantations in south Asia: Role of Social Dialogue, p20. Smith et al 2004. Ethical trade in African Horticulture: gender, rights and participation. IDS UK. 16 For more information see Auret 2004. Participatory social auditing: a practical guide to developing a gender-sensitive approach. IDS, UK.

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employment options to acquire wealth. They cannot live subsistence lifestyles without land and are often forced to trade work for food. They travel from farm to farm in search of employment and this means they may have to travel great distances for a little cash. Farmers exploit their poverty by offering them less food than an equivalent monetary payment. The landless have a lot of knowledge in tea as they have often worked on tea farms. With land they would be able to grow tea and support their basic consumption needs. How can SNV help the landless benefit more from the tea value chain? SNV may not be able to allocate land; but it can try to mobilize the landless into groups so that they have access to information and services. This appears to be working well with landless forest groups which have a landless lease sharing program worth replicating if possible. If SNV creates an association for Pluckers then the landless will also benefit from the training offered and the database created. Women also often lack formal land title.17 According to one informant 80% of the land in Ilam is registered in male names, so it is not surprising that most cooperative members are men. The government is offering a 25% discount on land title registered in womens name which is proving to be a successful affirmative action initiative. SNV could promote and mirror this initiative by offering incentives to farmers with female land title or other incentives such as discounted membership to the Farmer Federation for all cooperatives with 1/3 Dalit members. Forming the landless into cooperatives and other initiatives that include further exploration into land title could be considered. ORGANIC Many factory owners reported seeing organic teas as the way of the future for Nepals tea industry. They feel that the market is demanding pesticide free tea. Because there is a very strong demand for organic training and capacity building, this provides SNV with a unique opportunity to also push for more inclusive and pro-poor tea industry practices. For example factories who pay minimum wage receive organic training only. If SNV plans on supporting the tea industry to implement organic practices then the enabling environment will be critical. Farmers would benefit more if they are sensitized on the available opportunities in organic agriculture. Farmers will also stand a better chance of acquiring and purchasing organic farm inputs from input-suppliers at affordable prices if they are in cooperatives, sensitised and collectively share costs of transportation. Many farmers who have tried to go organic have dropped out of their cooperatives due to low crop yields, poor understanding of the organic agricultural inputs required and increased labour costs. This is a risk requiring management if SNV is to adopt an organic tea strategy. Many farmers who try and fail at something do not revisit the issue.

17

Nepali Females own only 8.1 percent of total land holdings and only 4% of households have female ownership of both houses and land (UNDP, 2004).

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Case study organic farmer in convergence Tilak Yonjon from the Bodour Dam Tea Producer Cooperative Ltd. Used fertilizer but it wasnt good for his health and it was costly so he and his cooperative decided to try organic tea farming. His problems now include, more diseases and plants have become dry. There is less tea coming now. I currently get 27RP per kilo but I need to get 50-60RP per kilo or it isnt worthwhile being organic. Mr Yonjon saves NRP 15 16000 per year on fertilizer but his labour costs have increased. Pluckers use to pluck up to 20 kilos per day for 80RP. Now there is less tea so they only pluck about 7kilos but I still have to pay them the same. He sells his tea to CTC factories even though it is orthodox tea. He explains, orthodox only buy young leaf but CTC will buy the older longer leaf and pay more for it. Mr Yonjon has never had training in organic. He has learnt some tips from friends and would really like to learn how to make organic fertilizer so he can make it himself and grow more tea. Orthodox factories may want to convert to organic tea but unless there is proper support and adequate service delivery for organic practices, their intentions may be unsustainable. Factorys should be able to afford to train their associated farmers and offer incentives to go organic such as distribution of cows for organic fertilizer and increased price of green tea leaf in the conversion years or organic tea farming is unlikely to be sustainable. One factory owner said, It doesnt reduce your yields if you know how to do it properly. Yet he appeared disinterested in assisting farmers with understanding what is required to convert to organics or offering any incentive to do so. There are some factories that have converted to organic and give very intensive training to their associated farmers as well as free cows and micro loans. SNV would be well placed to undertake research on farmer requirements for going organic, associated costs, coping strategies and lessons learned. This research would assist factories understand the demand organic conversion places on farmers and provide SNV with some solid information for which to base future market support. SNV could ensure all training and assistance associated with organic tea involves at least 30% women and the associated caste and ethnic population representation. For example if the population of Ilam has 8% Dalits then 8% of trainees should be Dalit. 18 If the future of the orthodox tea industry is to be organic then this will place marginalized groups in more powerful positions, enabling them to benefit upfront from market demand rather than later. SNV could assist organic tea by offering some training in veterinary skills. Farmers will need more cows to generate manure for organic fertilizer and without access to vets and affordable medicines; a significant financial blow could reduce the income increases associated with organic.19 If SNV chooses to train vets then SNV could insist on the trainees being female Dalits. In some instances affirmative action or positive discrimination is the most effective way to bring about social change and inclusion. The shared vision of HOTPA and HIMCOOP is undeveloped and this has caused delays in SNV programming. Whether going organic or code of conduct the members of HOTPA and HIMCOOP would benefit from the leadership for change program and its direction setting, strategic planning components. PRODUCTIVITY
18

For this type of information see 2008 Village Development committee Profile of Nepal: A socio-economic development database of Nepal. 19 Organic agriculture offers a 15 20% premium.

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It is clear from farmers and factories that productivity is a big issue. Factories do not operate at capacity because they cannot get enough green leaf and both discuss poor work ethic and absenteeism as problems. Productivity issues are a problem for the sustainability and competitiveness of the Nepal tea industry. Some lessons can be learnt from other countries grappling with similar issues. A plucking incentive scheme was introduced in Tamil Nadu with endorsement by state government. A payment was made for every kilogram over and above the base output. Its introduction brought about a 36% improvement in the plucker intake in their first 5 years and earnings increased by up to 25% - impact. Plantations reported that the scheme brought the cost of harvesting back to profitable levels.20 A 1992 study done on tea pluckers in South India showed that domestic demands on working women with children below 6 years of age were detrimental to their productivity. When the children reached school age their mothers productivity increased highlighting the need for childcare facilities and adequate schooling. In Sri Lanka more evidence is available. A one percent increase in childcare attendance puts up worker out turn (that is the converse of absenteeism) by 0.22 percentage points and daily productivity (intake) by 0.07 kilograms of green leaf.21 Another interesting link established in the 1992 South India study was between anemia and productivity. Productivity increased by 20% when a course of 100 iron tablets was administered to a cross section of tea pluckers. There are two tools available that could assist farmers and factories understand the economic benefits of welfare programs. Both are designed with large tea estates in mind but they will still serve a useful purpose if adapted to the Nepali context. One is a health and welfare audit which assesses the actual health and welfare situation for workers. A pro forma has been developed by the ILO which assists to objectively arrive at the welfare status of workers through a process of quantification. The pro forma assist factories and farmers to plan future strategies and priorities to upgrade their standards. The other tool is the Estate Social Development Index (ESDI) which is an off-shoot of the UNs Human Development Index (HDI).22 The ESDI incorporates human development (survival of workforce, adult literacy and earnings), gender development (male-female disparities as well as gender empowerment issues), basic services (housing, water supply, sanitation, electricity, health care and access to education), child development (survival, immunization, childcare facilities), community mobilization (political empowerment, access to recreational, cultural and religious activities, households with savings accounts and vocational training), and career development (earnings, proportion of permanent and casual workers, technical training and promotion opportunities). These tools could become a component of code of conduct compliance but could also be taught to all factories and farmers. Further research in south Asia concluded that aside from problems associated with fertilization and organic conversion, low productivity is primarily due to: a) High average age of tea bushes and slow pace or replantation 23 b) Inadequate attention to human resource development c) And above all productivity is a function of sound industrial relations. 24 In Nepal there are a huge issues associated with industrial relations. A number of new unions have emerged since the Maoist insurgency. These unions do not function effectively and are highly politicized causing problems for factories. Some donors have shied away from tackling
20 21

See ILO 2002. Labour and Social Issues in Plantations in South Asia: Role of Social Dialogue, p67. See ILO 2002, p66-7. 22 See ILO 2002 p69. 23 Tea bushes achieve optimum output of green leaves from age 5-30 years. Many bushes on small farms are found to be unto 50 years old See ILO 2002. 24 See ILO p32.

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the challenges of unionization but there are good lessons from India that can be applied to Nepal. Factories may initially resent SNV building the capacity of unions but exploring this issue could prove fruitful in the long term. What the lessons from India clearly illustrate is that GfE affects the productivity of the tea value chain. When GfE issues are mainstreamed and given adequate attention the value chain will function more effectively. Recommendations It is important for SNV to think more strategically about GfE issues if it wants to effectively mainstream in cash crops and improve the productivity of the sector. Mainstreaming can be difficult to do well, as participants often regard it as something outside or different to their normal work. Value chain development requires identifying strategies to change existing power relations within the chain for these cause inefficiencies, bottlenecks and monopolies. GfE analysis provides a starting point for more accurate poverty analysis and integration of key dimensions of extra market factors such as power relations and motivations that all effect value chain development and economic growth. This paper has illustrated how GfE can enhance value chain development. It is not possible to have one simple gender tool or GfE approach that can be effortlessly tacked onto a value chain development process. At different stages of the value chain and at different levels there will be different GfE needs. This paper was the result of a quick GfE analysis. To be more effective a thorough GfE analysis is required. Best practice suggests that undertaking a GfE analysis at the time of the value chain analysis can improve effectiveness. 25 Many of the complex issues highlighted by a GfE analysis are often not confined to GfE itself but are reflection of value chain bottlenecks. The below recommendations read like a set of aspirations for SNV to adopt depending on how effectively SNV wishes to focus on these aspects of value chain development.

25

See Mayoux and Mackie 2007. Making the Strongest Links: A practical guide to Mainstreaming Gender analysis in VCD. ILO.

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Issue

Recommendation

Responsible client/ LCB/partner

Comments

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2009 GSI mainstreaming requires strengthening Governance of producer groups is weak Encourage equitable representation, participation and access for marginalized groups and women across all programs and assignments Producer Group Strengthening There has been a lot of group formation but little group strengthening. It is time to focus on the governance of these groups.26 All clients, advisers and LCBs TEASEC and other NGOs Advisers to encourage equitable representation, participation and access for marginalized in training and other assignments. There is a need for leadership, GfE, financial literacy, gender (especially for men), change management, facilitation, power relations, assertiveness, marketing, bargaining and negotiation skills training.27 It is important that this training be given to all members of the cooperative, especially marginalized groups and women. Some of this training can be given by SNVs GfE advisers immediately. LCBs could deliver the rest in 2010. An LCB could be contracted for this work and the information widely disseminated with factory owners and farmers. A lot of research has been completed internationally about successful organic fertilizers and pest control methods that could be brought to Nepal.

High cost of organic conversion, lack of organic inputs and lack of understanding by factory owners of the effects of organic conversion on farmers.

Organic research Research farmers needs, service delivery short falls, opportunities and challenges from converting to organic tea. Inclusive Business Explore Inclusive Business opportunities with organic fertilizer/input supply companies. Tax incentives for organic farmers and factories Lobby the government to give factories and farmers tax breaks for organic agriculture. Improve effectiveness Work with clients to develop some key GfE indicators to evaluate their performance. For example: number of women on cooperative executive boards, sex disaggregated data, number of landless cooperatives established, outreach, etc.

OCN, HOTPA, NTCDB

FNCCI Ministry of Agriculture, NTCDB, DADO, clients All clients

Poor performance by clients, LCBs and contractors

Link AAs, contracts and payment to performance across SNV Nepal.

26

A lot of lessons have been learnt from Forestry User groups and how poor governance can lead to group conflict, destruction and elite capture that could be drawn upon. 27 Most of this training is covered in the leadership for change program but will need to be adapted to the tea industry. A ToT leadership for change training program is envisaged for many LCBs in Nepal in Dec/Jan 2010. SNVs advisers will then assist an LCB to adapt the leadership for change program for farmer groups. A roll out of this training program will hopefully occur in 2010.

HOTPA

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2010 Poor access to accurate information about market trends Improve market information dissemination Establish tea newsletter, seek sponsorship and sell advertising rights and widely disseminate. HIMCOOP Develop linkages with a national university offering journalism. Establish a rolling journalism intern program in 2010. These interns will be responsible for developing a tea newsletter covering tea trends (farmers, international markets), update on the India tea industry, standards, new technologies, new products as researched on the internet and acquired through interviewing farmers and other tea actors. The newsletter could be largely pictorial so illiterate farmers and laborers can still benefit. The platform could have the objective to organize an annual tea fair in Ilam that displays new technologies, inputs and products and seeks sponsorship and advertising for the event. This group could also be responsible for auditing the CoC but financial sustainability issues require further exploration. Contract LCB, or include as a component of an Inclusive Business with a financial institution, to provide SME training to Pluckers, labour, factory workers, farmers and their wives. Include how to use the internet for market research. Undertake a feasibility study that explores the concerns of farmers in terms of labour and the livelihood strategies of Pluckers. It could consider where to house a plucker/farm laborer association. Link with WASH sector to ensure farms and factories have access to latrines and clean drinking water. Explore HR issues with factories and health and safety issues such as protective clothing during pesticide use and regular rest breaks.

Poor communication and a lack of understanding about different actors in the tea value chain

Establish a Multi Stakeholder Platform Improve networking between clients, research and agricultural organizations, government, the private sector and tea labourers.

All tea actors

Poor business acumen, access to finance and income during the tea offseason There is a shortage of good quality, reliable Pluckers and farm labourers. Poor health of farmers, labourers, factory workers and pluckers and low productivity

SME training Inclusive Business with financial institution

Financial service provider and chamber of commerce ILO, LCB

Establish a Plucker/ farm laborer association that trains and records pluckers and farm labourers on a database. This association will become a service provider to factories and farmers. Explore Inclusive Business opportunities with a health insurance provider.

FNCCI Factories

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Clients lack a coherent vision and consensus for the future. Landless farm laborers live in poverty and have limited means at their disposal to improve their situation. Youth unemployment

Deliver Leadership for Change training

LCB and all clients

SNV to contract a LCB to deliver the leadership for change training program. This program will need to be adapted to different clients.

Improve access to land for pluckers and farm labourers in tea districts. The productivity of the tea industry would be improved if these experienced tea labourers had access to land.

LCB

Contract LCB to undertake research into landless labourers and explore avenues to increase their bargaining power and access to land and market information.

Youth internship program Explore the idea and potential of a youth internship program

Factories and clients

On the job skills training would be advantageous to youth and employees. It would provide meaningful alternatives to politicized youth and entice the younger generations interest in tea. This could be done in a number of ways and a combination is required: Coordinate with the wash sector to provide greater access to water in tea districts. Give men training on changing gender roles and the need for them to assist more with housework Give women training on bargaining and negotiation within the household Encourage cooperative meetings to be held at times suitable for women with full time employment, household chores and childcare responsibilities Explore childcare options for workers.

Women are often too busy to attend cooperative meetings and are frequently absent from work.

Free up womens time burdens

Clients and factories

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APPENDIX 1 The Gender Empowerment Measure The gender empowerment measure (GEM) is one of the five indicators used by the United Nations Development Programme in its annual Human Development Report. GEM reveals whether women take an active part in economic and political life. It tracks the share of seats in parliament held by women; of female legislators, senior officials and managers; and of female professional and technical workers- and the gender disparity in earned income, reflecting economic independence. The GEM exposes inequality in opportunities in selected areas. Nepal ranked 86th out of 93 countries in the 2007 GEM, with a value of 0.351. Below is the 2001 GEM ranking for each district in Nepal taken from the census.

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