Full-bodied human capital pivotal for Lesotho’s economic agenda
By Moeketsi Mohapi
The National Strategic Development Plan II 2018/19 to 2022/23, an extended arm of NSDP I, is a brain child of Lesotho’s deep-seated ambitions to foster a lasting and foundational economic revolutionary climate for better employment and job creation spearheaded by the private sector in Lesotho.
The labour market in Lesotho cannot be understood without making reference to the unique geographical location of the country. Lesotho is completely surrounded by the Republic of South Africa, and both economies are linked not only through their membership of the Southern African Development Community (SADC), but also through institutions like the Southern African Customs Union (SACU) and the Common Monetary Area (CMA) as ascribed by The International Labour Organization, Paper Policy 2. (Shaping a Labour Market Based Training Policy for Lesotho Torkel Alfthan and Theo Sparreboom, 1997).
The World Bank economic review of year 2023-2024 paints a marginal economic growth of 1.8% in the 2022 fiscal year for Lesotho. The main growth drivers were construction, mining, manufacturing, business services, and public administration. Agriculture also contributed positively due to good seasonal rainfalls and input subsidies and, to a large degree, the wool and mohair and primarily due to higher imports of capital goods and services associated with the ongoing construction project of the Lesotho Highlands Water Project and limited export growth.
The Lesotho Highlands Water Project is a monumental hydro contractual and beneficiation project powered by two nations, Lesotho and The Republic of South Africa, founded on the treaty in October 1986.
The treaty provides for the establishment, implementation, operation and maintenance of the project, whose purpose is to enhance the use of the water of the Senqu/Orange River by storing, regulating, diverting and controlling its waters and affluent in order to effect the delivery of specified quantities of water to the designated outlet point in the Republic of South Africa and by utilizing such delivery system to generate hydro-electric power in the Kingdom of Lesotho.
Up to 85,000 people will benefit upon completion of the project, which is bound to impact positively on community development activities, private sector growth through improved infrastructure and contribute to Lesotho’s socio-economic development.
Leading this revolutionary water project is an amalgamation of a largely foreign international private sector giants contracted for the construction of both the Polihali Dam and the diversion tunnel, Kopano Ke Matla JV- SUN JV, to name a few.
Earmarked as a beacon of economic glimmer, ignition of the labour market and a strategic private sector enabler, the early implementation stages of the Polihali water project turned to parade a cloud of human rights, fragmented institutional muscles, timid monitoring and evaluation systems, blunt labour and employment frameworks and limping strategic skills acquisition and transfer gaps with the said water project.
Official reports of labour law violations, racial segregation, inhuman treatment, sexual assaults, alleged common assaults and renumerations inconsistencies were met by a stale and non-responsive system enabling the breed of multiple corrosive labour malpractices in this his historic water project.
The Lesotho workers association secretary general, Mr Seoholimo Hlalefang, lamented lack of enforcement from security agencies in the Mokhotlong jurisdiction wherein two cases of indecent assault have since been reported earlier on this year bearing a case number of 06 384/01/24.Seoholio said the workforce in these projects are subject to continued ill-treatment, victimization and inhuman conditions, including sub-standard nutrition programmes.
On March 15, 2023, the Government of Lesotho deposited the instruments of ratification of the Labour Relations (Public Service) Convention, 1978 (No. 151), the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187), and the Violence and Harassment Convention, 2019 (No. 190) in a bid to safeguard an efficient labour market and safer work environment in Lesotho.
The United States (US) had called for the passing of the labour laws that are in line with the stipulated international labour practices. This is one of the requirements that had been placed by the US for the government to satisfy so that it releases over US$300 million (approximately M5,6 billion) for the much-anticipated Millennium Challenge Corporation (MCC) Compact II.
The US had previously said in a statement “MCC and the Government will now continue to work together on the compact’s administrative requirement. Additionally, the Lesotho government must pass key legal reforms to improve women’s legal rights and protections, and to bring Lesotho in compliance with international labor standards.
In bid to mediate towards a lasting solution between the workers, labour unions and the employing contractors in the Lesotho highlands water project, the parliamentary committee of natural resource undertook the mandate to evaluate both the tendering document and contractual fine prints in an effort to trace the compensation gauge and standards as enshrined.
This after the labour unions lamented the inappropriate implementation of the Lesotho minimum wage rates and standard in what the labour unions called the lucrative international standard project which should give Basotho an acceptable compensation in line with the demands and current standards of living.
Seoholimo further stated the renumeration and contractual offers from the employers subject employees to an unstable fiscal position and shaky job security as the employer had previously offered a one year working contract on minimum wage rates.
The contractual arrangement the labour union lament is to the detriment of the working class. According to the minimum wage of Lesotho 2023-2024, an employee of less than a year in current employment is clustered in a minimum wage tier of M14.00 per hour, an accumulative sum of 2858.00 per month. Employees with over a year fall in the M3,147.00 per month cluster.
The Molibeli commission, commissioned in the Phase I of the Katse Dam Project had made a finding that in this manner of world class projects, the minimum wage is not applicable-the commission had recommended that the said standard wage should be of the Free-State labour market rates in SA.
The Parliamentary Chairperson of Natural Resource, Mr Moeketsi Mots’oane said his committee has been up in arms in mediation between LHDA, awarded contractors and the labour union in search for a lasting resolution to labour unions’ compensation dissatisfactions and a host of other matters arising. Mots’oane said his committee has asked for a week-long extension of their original two-week mandate on account of getting incomplete information from the relevant stakeholders such as the ministry and LHDA.
He said the committee sought to study the feasibility of the project, evaluation reports of the tendering process during the contract award and the Bill of quantities from the awarded contractors. Moeketsi said bizarrely, among other documents received was the bill of quantities which does not have labour rates but only material and other relatable rates.
Mots’oane said this information will inform the committee to establish the competitive edge of the awarded contractors and further establish what they had proposed to pay the workers in their technical proposal for tendering.
The Minister of Labour and Employment, Hon Tsiliso Mokhosi, said Lesotho’s appetite to learn and acquire clear policies to drive and inform matters of compensation, skills development and private sector empowerment from phase one of the project fuels some of the misfiring unfolding around the LHDA mega billions phase II water project.
The first phase of the ground-breaking projects was inaugurated by South African President Thabo Mbeki and King Letsie III of Lesotho in the year 1998.
The four-phase water transfer project involved diverting about half the water flowing down the Senqu river into the Vaal river system to meet the demand of South Africa’s rapidly expanding Gauteng province.
Gauteng, South Africa’s economic powerhouse, is home to 40 percent of the population. In return, Lesotho receives R200 million (almost US $30 million) from South Africa in annual royalties. The mountain kingdom’s recurrent budget is about R261 million (about US$39 million). Water, called “white gold” in Lesotho, is the country’s largest single source of foreign exchange.
Taking into account the investment and brain economy this manner of projects attracts, Mokhosi said there was no reason why Lesotho has not developed a fair and acceptable level of skills acquisition policy and programmes from which the country could develop and set up its small-scale dams for agricultural and tourism projects.
He was upbeat about the lack of compensatory policy frameworks which would inform and guide the compensation process and value assessment criterion of affected communities as this has affected the lives of Basotho around these projects on a long-term scale.
Communities affected by the construction developments are held at ransom by LHDA as scores of them are yet to see the light of day regarding their compensation grants. During the phase II inauguration, disgruntled members of the affected communities marred the phase II inauguration parading placards demanding their promised compensations. The members of the force allegedly confiscated the placards from the arriving international media and the President of South Africa, Mr Ramaphosa (See picture).
The project is one of the Southern Africa Development Community (SADC) priority water infrastructure projects for promoting regional integration. The project is estimated to cost ZAR 32.562 billion (UA 1.576 billion), net of taxes and duties. The AfDB loan of ZAR 1.3 billion and NDB loan of ZAR 3.2 billion will finance, on pari-pasu basis, part of component B – Main works covering Polihali Dam and Polihali Transfer Tunnel works.
