The Lesotho Highlands Development Authority (LHDA) is building a third major dam, despite concerns about the welfare of thousands of villagers who lost their homes or land after the first dams were built in return for what many feel is inadequate compensation.
"Lesotho continues to sell natural resources that their own people need," said Mabusetsa Lenka, head of the water, justice and environmental programmes at Transformation Resource Centre (TRC) a human rights and social justice NGO based in the capital, Maseru.
"These people lived off the water and land by the river for a long time until suddenly the LHDA took it away from them and gave them a small amount of cash. Now [contrary to promises made] they lack running water and electricity and they aren't even allowed to touch the water in the man-made lakes that are right next to their villages."
The agreement to build Polihali Dam, signed in August 2011 by the Lesotho and South African governments, formally kicks off the second phase of the Lesotho Highlands Water Project.
It is an ambitious 30-year, US$16 billion bilateral venture that envisions building five or six large dams in Lesotho to supply neighbouring South Africa's rapidly increasing industrial demand for water and electricity. The largest water infrastructure project on the African continent, when completed it will transfer over 70 cubic metres of water per second to South Africa.
The first two dams - Katse, completed in 1998, followed by Mohale in 2002 - yielded a profit of $64 million to Lesotho's government in the past year, and $340 million between 1998 and 2009, but civil society organizations point out that the over 27,000 villagers directly affected by construction of the dams have experienced more losses than benefits.
"No more dams should even be on the drawing board until the social and environmental problems created by the first dams are resolved," said Lori Pottinger, an African specialist at International Rivers (IR), an environmental and human rights NGO based in Berkeley, California.
Several villages were partially or completely submerged when the Katse and Mohale dams were built on the Senqunyane River in southern Lesotho's Thabaputsoa mountain range, forcing the resettlement of 467 households.
However, many more households were affected by the damage or loss of arable and grazing lands. Villagers within a two to five kilometre radius of the dams were given new houses, a communal water tap, pit latrines, and annual compensation averaging $650 per household, which they are supposed to receive for the next 50 years.
But the villagers IRIN spoke to said the soil of the land where they were resettled, higher up in the mountains, is much poorer than where they farmed before, the plots they were given are much smaller, and the compensation money is not enough to live on. Although they were given some choice about where to resettle, Lenka said the options were limited and ill-informed “and in some instances, the choice was influenced by LHDA officials”.
The LHDA Chief Executive Officer, Peter Makuta, insists that the compensation has been more than fair, and claims that the bigger problems are the dependency the payments have created among the farmers, and their inability to adapt.
"The rates that we've compensated them are some of the best in the world, I promise you. The big problem is that our policy replaces their livestock and land with hard cash, and these farmers are not used to living off money. We've introduced these people to a completely different way of life," he told IRIN.
Phakiso Hlotsi, 34, who lived in Haralifate, a village that now lies beneath the water of the Mohale dam, said he would prefer good land to an insufficient handout.
"Life is more difficult now than it used to be when we were along the river," he told IRIN. "I used to be able to support my whole family farming maize, wheat and vegetables on a plot of land three times the size of what we have now."
Hlotsi, his wife and two children were resettled in 1996 at Ha-Tsiu, a village on the side of a mountain.
Hlotsi's sister has since passed away, so they now care for her three children as well. “If I had good land then I would be able to feed my family and sell my extra produce for cash...I can't last the entire year on 5,000 maloti ($650)."
A community leader from Likalaneng village, a few kilometres from the dam, who gave her name only as Mpeoane, agreed that the resettlement package had not been enough to compensate villagers for the loss of their land.
"The houses are good quality and the sanitation and communal water source have been positive, but just getting money that isn’t enough to live off, while not having land to produce food isn’t a good situation," she said.
The LHDA did not reveal the total amount it has spent on compensation, but its annual report shows that in 2006, the most recent year for which figures are available $859,000 was paid to 2,237 affected households as cash compensation and $950,000 went on lump sum payments for the loss of arable land.
Allegations of corruption and embezzlement have dogged the compensation process.
Villages receive communal compensation annually, based on how many households have resettled there as a result of the dams. Locally selected committees are supposed to invest the money in projects that benefit the whole community, but many villagers said they have never seen any of the money
The latest report by the LHWP Panel of Experts examining the communities affected by the Katse Dam, notes that there has been an "increasing rate of embezzlement of communal compensation" by local committees.
"We were supposed to buy medicinal plants, like aloe, that everyone in the village could use. But the committee just pocketed that money," said Hlotsi. "Every time we confront the committees there are fights but there's nothing we can do."
Many villagers also say that the individual annual compensation they received was "inconsistent and often delayed", while others say they have never received compensation from the LHDA for land they lost during the resettlement.
"The agreement we signed was for 50 years, but sometimes the money doesn't come, so a lot of us don't really trust them," said one of the resettled villagers.
The TRC is planning to take several cases of non-payment of compensation to court. "We hope to have our first case in court next month," said Lerato Rabatho, a TRC lawyer. "Our expectation is that a positive ruling in this case would have an effect on all the other compensation cases that we have waiting."
A 2010 paper published in African Study Monographs that examined the success of resettlement caused by the Mohale Dam concluded that while support to resettlers for income-generating and agricultural activities was well-intentioned and well-funded, “with few exceptions it was ineffectual”.
“The majority of the project-affected people who were resettled or relocated have had a portion of their livelihoods restored through compensation but from their own perspectives largely are worse off they were before the project began,” write the authors.
Phase II of the Lesotho Highlands Water Project, which is expected to be completed by 2018 at an estimated total cost of $1.9 billion, will displace 17 villages and affect the grazing land of 72 more, impacting the livelihoods of roughly 4,000 households.
Construction of the road system, a 38km underground tunnel, and telecommunications infrastructure needed to build the 163.5m wall of the Polihali Dam are already underway, but water experts and rights activists are questioning whether lessons have been learned from Phase I, and whether building more dams will benefit Lesotho's economic development.
The completed project will divert 40 percent of the water in the Senqunyane River Basin to South Africa's Ash River. International Rivers warns that the long-term effects of such a drastic environmental shift are not yet fully understood.
"The impacts of the dams, socially and environmentally, are much more far-reaching than the 60 kilometres downstream that they [LHDA] look at," said Pottinger.
Opposition to the Polihali project has emerged during community consultations, but the Lesotho Highlands Water Commission argues that it will benefit the local economy by creating thousands of jobs for local communities and generating profits from tourism.
"The way we are implementing Phase II will be different from previous approaches," Makuta said, although he did not specify how.