The construction of the Polihali Dam and reservoir, water transfer tunnel and the associated access roads, bridges, and other associated infrastructure works have affected the communities causing for the relocation and resettlement of those to allow for construction of these major works.

Last month His Majesty King Letsie III and South Africa’s President Cyril Ramaphosa led the sod turning of major works of the Lesotho Highlands Water Project Phase II.

According to the Lesotho Highlands Development Authority (LHDA), the implementation of Phase II requires the acquisition of about 5 000 hectares of land from local communities for the construction of Polihali Dam and reservoir in the valleys and tributary catchments of the Senqu and Khubelu Rivers.

These construction will require that communities are relocated and make a way for these mega projects. This will in turn have an effect on livelihoods and socio-economic status of the local communities as their houses, land, and their properties. LHDA as the implementing agency of the Lesotho Highlands Water Project (LHWP) has the duty to ensure the well-being of communities affected by the construction of a new dam and associated works through compensating them and facilitating their relocation so that they are not worse off due to these major projects.

Meanwhile, the Treaty governing the LHWP and the Phase II Agreement commits both Parties to take “all reasonable measures to ensure that the implementation, operation and maintenance of the project are compatible with the protection and the existing quality of the environment and, in particular, shall pay due regard to the maintenance of the welfare of the persons and communities immediately affected by the Project”.

Our reporter Thoboloko Ntšonyane engages the LHDA’s Public Relations Manager Mpho Brown to take us through the processes involved in compensation of affected communities and families.

Below is the excerpt of the interview.

Can you describe the specific losses or damages that the affected individuals/communities get compensated for?

Households affected by the LHWP II can be compensated for various asset types such as: arable land (fields), gardens, residential plots and houses, business plots and structures, fruit trees, medicinal plants, kraals, sheds and thickets.

Communities get communal compensation for rangelands and useful community natural resources. Compensation for community assets is calculated based on the size of the loss and the number of affected households.

Which factors come into play when determining fair compensation for the affected families?

The Compensation Policy which was developed based on inputs from the affected communities and in line with the Constitution of Lesotho and the Land Act guides compensation payments to affected households and communities. 

Compensation rates for Phase II have been declared under the Compensation Regulations and are adjusted annually for price escalation based on Consumer Price Index. Compensation rates are determined for each asset type. The value of each compensation entitlement is determined by the type of asset that is affected, the size of that asset and the compensation rate for that particular asset type.

Does LHDA offer a lump sum or pay the affected parties on a monthly basis as a form of compensation for having to relocate from their original settlement to a new location in order to make a way for Polihali Dam construction and associated works?

All affected households are at liberty to choose the compensation method that suit their needs. These can include:  Land for land where land is available, lump sum cash compensation payment, grain and pulses compensation for 50 years, annual cash compensation for 50 years and also the option to combine all the methods listed above. In many cases a single household/individual can have multiple assets that may attract compensation.

Important to highlight is that the annual cash payment option is applicable for assets such as fields,  while other assets such as thickets and trees are paid lump sum payments only.

Households that are affected by relocation have a range of options to choose from. These include relocating to vicinity within their village, relocation to a Project designated site or to a place of their choice.

They are consulted on their compensation entitlements, relocation site options and replacement house designs. Loss of houses is compensated based on the principle of replacement cost in the form of replacement house, construction by the owner or lump sum payment.

Over and above the compensation entitlement, households affected by resettlement are paid disturbance allowance for the inconveniences that come with being relocated.

It is important to note that Lesotho laws provide for prompt payment of full compensation for property that has been expropriated (Constitution of Lesotho Section 17(1) c). Also, the Land Act states that where there has been compulsory acquisition of property, the person deprived of such property shall be entitled to compensation at market value. 

During the development of Phase II compensation policy, the LHDA held consultations with affected communities, and in some cases the communities themselves indicated that they prefer not to be given lump sums. They explained that past experience has taught them that the lump sums do not last long hence the option of paying compensation value over 50 years. This was viewed as the reasonable length of time to allow for various other livelihoods means to be developed and other livelihood improvement programmes to have had an impact on diversifying sustainable means of living.

Do the affected parties have a say on the decision-making process regarding the new place they will be required to relocate to?

Yes, affected parties have a say on where they relocate to. They are consulted on: identifying resettlement areas, village layout of their new area, as well as the design and construction of their replacement housing. This process was initiated years in advance as various communities were being consulted about the project’s impact in their areas; it is an ongoing process that is currently at differing stages for different communities affected by resettlement.

In a case where the new place the parties are about to relocate to does not have essential services such as schools, health facilities, police posts, what role if any does LHDA play to address those challenges?

The Project ensures that host communities are also consulted before welcoming resettled communities, and similarly are paid compensation for direct losses because of resettlement activities. For impacts on communal assets, measures are identified through the resettlement planning process and assessed in consultation with government and local authorities. Communal compensation for both the relocated community and the host communities can therefore play a role in financing development projects in this new host community. The decision of which development projects will be financed lies with the community itself and the LHDA facilitates payments for the development projects as they are conducted.

What role does the project play in ensuring a smooth transition and integration for the affected into the new community?

Consultations involving representatives of host and resettled communities are held extensively to ensure smooth integration. Relocation is a sensitive process that requires careful consideration by all those affected, and the project ensures that those affected understand fully, the pros and cons of their choices for relocation. It is worth noting in this process that moving too far away from one’s area of origin comes with many challenges, and during these consultations, we ensure to make impacted individuals aware of these before they make these life changing choices.

In a situation in which the project disrupts employment or business opportunities of a person, are there measures in place for reinstatement or alternative and continuous income generation arrangement that is put in place by the project?

According to the Compensation Policy, business owners are compensated for their structures, as a lump sum or through the provision of a replacement structure, based on replacement cost.

In the case where the business is forced to close and cannot be re-opened; the value of that business (distinct from the premises) will be established through a comprehensive impact assessment and compensation will be paid based on the assessment.

In the case where the business is temporarily affected during construction activities, the owner will be compensated for loss of profit during the period of impact. This is determined again through a comprehensive assessment together with the business owner and relevant experts.

Is there any training offered to the affected individuals to better their lives and improve their well-being while resettling to a new location?

Yes. There are multiple livelihoods improvement programmes for impacted individuals and communities under Phase II.

One of the key ones is the Financial Education and Literacy programme which is conducted through a series of workshops for project affected individuals who plan to use their compensation funds to start enterprise-based livelihoods. Because sometimes the amount due to each household is quite substantial and may not necessarily be fully allocated towards start-up entity or expansion of an existing one, the programme partners with Financial Institutions to provide trainings and product education on various investment vehicles and financial products that individuals and households can make use of to ensure sustained benefit from their compensation from assets or relocation. This is particularly useful for some impacted individuals that relocate from rural to urban areas where means of living can be vastly different from what they are used to. This is a crucial part of what the project does.

What other forms of support do you offer the affected communities?

LHDA recognises the need to restore the livelihoods of those people affected by the project. Now at an advanced stage of planning with demonstration projects in vegetable tunnels, village chickens and agiculture underway, the livelihoods restoration programme offers support to affected households through projects of their choice with advice from LHDA and external experts. These also include trainings: the above mentioned financial literacy programme, the skills testing and accreditation programme, enterprise, farm and off farm-based trainings and market linkages, all intended to support the restoration of sustainable livelihoods for those impacted by the project. These programmes also include livelihood restoration plans designed and tailored for specific characteristics and needs of individual households affected by resettlement.

What are the main economic and financial impacts on the part of the project resulting from the public demonstrations that hinder construction work?

The LHDA considers with extreme care, all issues, big and small, that can impact and lead to dissatisfaction of communities around the project. Thus, we attempt as much as possible to minimize any situation that can lead to demonstrations and public protests.

We have put in place community consultation structures in the form of Area Liaison Committees (ALC), made up of community representation, community leadership as well as LHDA representation to try and ensure continuous and smooth consultation between the community and the project at all times. We have also put in place a comprehensive complaints management system that ensures transparent and strict follow up on all complaints lodged by the communities, whether directly with LHDA, through the contractors, or through the ALCs.

That said, there are times when some disputes may escalate and in all those cases, we are committed to working with the communities to reach resolutions.

When there are stoppages, the biggest impact to us is to our relationship with the community and the reputation of trust and reliability we would like Basotho to have with the project. Economic impact to the project can include fees and fines for delayed delivery of the project milestones by the contractors, but more importantly, it is the economic impact to the communities caused by, delayed processing of payments for due compensation, delays to the completion of development works that are meant to benefit the communities themselves, including roads, health facilities, implementation of community development programs, and a host of others.