Moroke Sekoboto
A scathing inspection report by the Office of the Ombudsman has laid bare deepening social and economic distress linked to the multi-billion-maloti Lesotho Highlands Water Project (LHWP) Phase II, particularly the construction of the Polihali Dam in Mokhotlong.
In her report issued this week, Ombudsman, Advocate Tlotliso Polaki, found that financial insecurity remained the central flashpoint among communities displaced to make way for the project, amid mounting allegations that the Lesotho Highlands Development Authority (LHDA) has failed to provide adequate compensation and meaningful consultations on the general welfare of displaced communities.
The report paints a troubling picture of a project mired in social disruption, with affected communities accusing the LHDA of sidelining their voices and imposing decisions with far-reaching consequences on their livelihoods.
“The inspection established that consultative processes were perceived as deficient. Communities alleged that the LHDA failed to conduct meaningful, inclusive, and timely consultations,” Adv Polaki said.
“Information regarding compensation rates, formulas, and relocation sites was not adequately disclosed, preventing informed decision-making by affected persons.”
The Ombudsman further found that engagement with communities was often superficial, occurring only after key project decisions had already been made.
“Community consultation was treated as a procedural exercise rather than meaningful dialogue, with consultations occurring after project decisions had been finalised,” Adv Polaki said.
“This was evident where affected residents faced relocation with limited choice in resettlement sites and expressed dissatisfaction with replacement housing quality.”
As of 31 December 2025, compensation arrears under Phase I had ballooned to more than M142 million, while Phase II arrears stood at approximately M6.7 million—deepening financial strain for affected households.
She states that villagers have strongly criticised the current 50-year compensation framework, arguing it fails to secure long-term livelihoods. They are instead demanding 99-year or lifetime compensation entitlements to ensure intergenerational security.
“Compensation rates for lost arable land, fruit trees and communal assets were perceived as arbitrary and insufficient, falling below standards required to maintain pre-project living standards.
“Communities reported that compensation rates were inadequate to sustain long-term livelihoods.
“A central point of contention is the 50-year compensation period, which residents argue should be a lifetime or 99-year entitlement to ensure intergenerational security,” she added.
The report notes that current compensation rates, based on a 2017 policy, no longer reflect prevailing market values or account for future income losses, particularly for small-scale farmers.
“Compensation based on the 2017 Policy utilises land valuation rates that fail to reflect current market value or future income loss.
“Communities dependent on small-scale farming have lost productive agricultural land, leading to increased poverty.
“Compensation delays have caused financial distress and insecurity for many families,” she said.
The Ombudsman also documented significant delays in compensation disbursements, including payments for communal grazing land and individual crop losses.
“Significant delays in compensation disbursements were documented, including for communal assets (grazing land) and individual crop losses.
“Some households were forced to relocate without adequate compensation or livelihood restoration,” Adv Polaki said.
Beyond economic hardship, the report highlights the physical toll of the project on affected communities. Blasting and heavy machinery have caused structural damage to homes, with at least one house collapsing completely.
“Polihali Phase II construction has resulted in damage to existing dwellings through blasting and heavy machinery.
“Reports indicated indiscriminate blasting negatively impacted resident safety and causing property damage.
“The Ombudsman evidenced several houses with structural cracks, including one complete collapse,” she said.
Adv Polaki says although the LHDA reported that 48 houses had been repaired as of 19 March 2026, residents continue to raise concerns about ongoing blasting, noise and dust pollution.
The report recommends urgent mitigation measures, including the installation of professional-grade sound barriers in high-risk villages such as Masakong and Ha Tlhakola.
The relocation process has also been criticised for worsening poverty levels, with some resettlement sites lacking basic infrastructure such as water and electricity.
The Ombudsman further raises concerns about gender inequality in compensation distribution.
While LHDA policy requires dual-spouse consent during asset verification, the report found that compensation payments are largely controlled by male heads of households, marginalising women.
Meanwhile, the project’s grievance mechanism has been described as ineffective, with some complaints remaining unresolved for more than a year.
“The project’s grievance mechanism was described by many as ineffective. Some complaints remain unresolved for over a year.”
Adv Polaki said although the LHDA claims an 81.5 percent resolution rate for Ombudsman-related cases, 76 cases remain outstanding—75 of which are stalled due to legislative hurdles regarding changes of beneficiaries.
The Ombudsman therefore concludes that the LHDA had failed to adhere to international best practices, raising the risk of constitutional rights violations.
The report calls for an immediate review of compensation rates, expedited payment of arrears, and the implementation of sustainable livelihood restoration programmes to ensure that affected communities are “no worse off” than they were before the project began.
Adv Polaki’s report follows His Majesty King Letsie III’s call for the LHDA to effectively compensate the affected communities.
Speaking at the launch of the Senqu Bridge this past week, the King emphasised that livelihood restoration and environmental protection must remain priorities, noting that some people affected during the first phase more than 30 years ago were still awaiting compensation.
He acknowledged the significant sacrifices made by affected communities, including relocation, loss of grazing land and disruption of livelihoods.
“These sacrifices have not gone unnoticed. The governments must ensure that resettlement and support programmes are implemented fully, faithfully and on time,” he said.
He stressed that affected people should not be left worse off than before the project.
Contacted for comment, LHDA Public Relations Manager, Mpho Brown, said the LHDA was already addressing concerns raised by Adv Polaki.
“The Lesotho Highlands Development Authority acknowledges the Ombudsman’s report and welcomes the oversight role of independent institutions in strengthening accountability and improving implementation of projects of national significance.
“We note that the report recognizes both the importance of the LHWP Phase II and areas where improvements in community engagement, compensation processes and social support mechanisms are required.
“LHDA remains committed to ensuring that project-affected communities are treated fairly and with dignity, in line with the LHWP Treaty, applicable policies and our broader development obligations.
“Many of the matters raised are already being addressed through ongoing compensation administration, accelerated relocation measures, strengthened grievance handling and continued engagement with affected communities and other stakeholders. We view the report as a constructive contribution that will help inform further improvements as the project progresses.
“Our focus remains on working collaboratively with all stakeholders to ensure the project delivers long-term national and regional benefits while safeguarding the interests and wellbeing of affected communities,” Mr Brown said.
