Mohloai Mpesi
MINISTER of Natural Resources, Mohlomi Moleko, has faced intense questioning from the Senate over M136 million linked to Phase II of the Lesotho Highlands Water Project (LHWP), which remains held in South Africa.
The funds have been earmarked to compensate communities affected by the ongoing Polihali Dam project.
The matter arose after Senator Seabata Motsamai asked the minister to confirm whether he had honoured a commitment made on 11 December 2025—that all outstanding compensation for affected individuals and communities would be fully paid by 31 March 2026.
Mr Motsamai said Mr Moleko had made the assurance during the Seinoli Legal Centre’s third Stakeholders Conference on Human Rights and Development, where he indicated that, together with his South African counterpart, all compensation under the LHWP would be settled by the deadline.
He challenged the minister to confirm whether the commitment had been fulfilled and, if not, to explain the delay and clarify who bears the full cost of compensation.
In response, Mr Moleko told the Senate that compensation under the Lesotho Highlands Development Authority (LHDA) covers both individual household property and community assets, and is administered in accordance with the Lesotho Highlands Water Treaty, national laws, and LHWP regulations.
He said of the 4315 families affected under Phase I, 2488 (58 percent) had opted for and received lump-sum payments, while the remaining 1827 (42 percent) chose annual payments.
During the 2025/2026 financial year, 1,713 families received annual payments totalling M13.8 million. However, 114 families – about 6.6 percent – were still owed M5.7 million.
Mr Moleko attributed the delays to issues such as disputes over heirs, absence of beneficiaries, lack of valid identity documents, and family conflicts over inheritance.
On community compensation, he said M136 million is still outstanding and is yet to be transferred from South Africa. The funds are currently held by the Trans-Caledon Tunnel Authority (TCTA).
He explained that under Article 8(a) of Protocol 6 of the LHWP agreement, a trust fund account must first be established to receive and manage the money on behalf of affected communities.
“The LHDA is in the process of opening a bank account that will earn interest for the benefit of the communities. Once that is done, the M136 million will be transferred into that account,” Mr Moleko said.
However, Mr Moleko revealed that he had instructed that the funds be transferred to Lesotho without delay, even as the process of establishing the trust account continues.
“I have been questioning why the M136 million has not yet come into Lesotho. I directed that the TCTA be formally requested to release the funds while the trust fund arrangements are being finalised,” he said.
He added that the LHDA board had last week instructed its management to proceed with requesting the funds while the account-opening process continues.
Mr Moleko said M34.6 million was spent in the 2025/2026 financial year on community compensation projects, including electrification in eight villages near the Mohale Dam.
Looking ahead, Mr Moleko said approximately 2283 families were expected to be affected by the Polihali Phase II project in Mokhotlong. So far, 1629 families have been compensated, with a further 654 families expected to be paid once the dam has been completed.
He said the LHDA was in the process of registering properties for the remaining families, who were expected to receive compensation between late 2026 and early 2027. To date, total compensation paid stands at M168 million, he said.
Mr Moleko reiterated that ongoing challenges include difficulties in identifying rightful heirs, intra-family disputes, and operational constraints involving external stakeholders.
The issue comes amid calls from His Majesty King Letsie III and South African President Cyril Ramaphosa for full and timely compensation of all affected communities. The two leaders made the appeal during the recent official opening of the Senqu Bridge in Mokhotlong, a key component of the Polihali Dam project.