Compensation Framework as a Necessary Structural Socio-Economic Tool in Expropriation Processes

Part 2

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Photo by Daniel Jacobs on Unsplash

COVID-19 has clearly demonstrated the vulnerability of Lesotho’s economy and the livelihood of her citizens. One of the most pressing needs to reduce the vulnerability of the disadvantaged is to adopt structural frameworks to ensure that development projects do not marginalise and impoverish the poor. In this instance, well thought out structural tools aimed at guaranteeing livelihoods should be a key focus.

Compensation and expropriation reform laws and policies come as essential structural reforms with a potential to tackle structural and institutional deficiencies in practice. It is quite urgent to ensure that developmental projects are not degenerative to the livelihoods of individuals they should be benefiting. Post COVID-19, compensation policies and laws are one of those frameworks with a high potential to address structural problems central to vulnerability of the rural population affected by development projects.

It is trite that the highlands harbour the most vulnerable and this imperatively places a duty of guarantee upon the Executive and the Legislature to adopt frameworks intended to enhance and safeguard their livelihoods. The compulsory land acquisition and expropriation processes have hit hard on the rural population.

As a result, bringing to life equitable compensation and mechanisms are key thrusts to reduce the vulnerability, emotional and financial distress on those affected. What is always worth noting for the powers that be is that profit making organisations are not charitable organisation. In essence, their primary objective is profit. Sounds cliché but there can never be any denying that mining companies extract minerals for profits and when the resources are depleted would look for better places for extraction.

Compensation policy is necessary in post COVID-19 Lesotho in order to address even historical injustices resulting from land dispossessions of the marginalised. Experience has shown and demonstrated unequivocally that expropriation is a game with players intending to maximise their outcomes.  In such games, equilibria is very essential. If the payoffs in a game correspond to how fit the players are, then expropriation processes favour the more fit at the expense of the less fit whereby at that point equilibrium collapses and unfairness reigns supreme.

Fairness in a social contract is very essential to the stability and efficiency of the same setting otherwise it will not survive. Financially, psychologically and legally, individuals do not have equal negotiating muscles with the expropriating authorities. The existing legal frameworks give the expropriating agencies and authorities too much latitude. The disparity in the negotiating powers between the expropriating agencies and authorities and the vulnerable places a positive duty on the government to have structural tools to engender fairness and a level playing field for selfless cooperation in the human game of life.

An equitable compensation policy essentially entails fairness and justice as its core founding values principles in order to achieve stability and efficiency. Historically, restitution, either financially and/ or land placements, has bred more socio-economic and cultural burdens on the vulnerable. There has always been a pressing need to address these burdens with sufficient and adequate structural frameworks. A compensation policy would comprehensively secure the rights of the citizens prior to and during the expropriation process. Such a legal structural and institutional framework would create a more generous, general and ascertainable process as well as creating a more equitable pattern of compensation.

Since the inception of the engagement of developmental projects, compensation has been quite problematic and there has been little progress. There has never been reciprocity in the negotiating capacity of the players in this strategic game. Unevenness in this capacity has been detrimental to the vulnerable. The result has been demoralising as the vulnerable are prone to poverty and their standard of living is negatively impacted.

Interviews conducted and published on international media platforms Bloomberg and Business Live in June 2020 reflect that villagers have accused LHDA of paying pittance for land. In the interview, an elderly citizen, Mapuso Lengoasa from around the site close to the site of the planned Polihali Dam was is reported to have been paid M2,114 maloti (Two Thousand, One Hundred and Fourteen Maloti) for a field from which she used to earn M15,000 (Fifteen Thousand Maloti) a year by growing sorghum at the base of the Thaba-Sephara Mountain.

One other developmental aspect that has been problematic has been the potential contribution the projects have in raising the standard of living of the individuals and in the development of the places the concerned corporate entities reside in. Adoption of a comprehensive compensation framework in conjunction with other laws would set up the necessary structural and institutional mechanism to ensure that the utility of the places in which development projects are undertaken are not degenerated. Further, it is of vital importance to ensure that livelihoods are secured.

Climate change has also had a debilitating impact of a very huge magnitude on agriculture and the worst part is that its duration is uncertain. This has called into action many policy responses on compensation and allocation of land to the dispossessed. Further, this calls for further action to ensure the existence of structural frameworks to support with effectiveness, the concerns of the vulnerable. This is where comprehensive compensation policies and laws come into play. With a firm consolidated framework in place, it would be easier to conceive complimentary policies and laws to provide support for the agricultural settings, water and essential services accessibility and proper environmental management.

A comprehensive compensation framework involves a trade-off between capital intensity oriented development and individual rights to property, shelter, livelihood and basic needs. This paradigm has to be carefully weighed to avoid the current economic trend where prosperity and growth undermine the rights and well-being of the vulnerable. Striking a balance between the two seemingly competing interests promotes societal stability. A comprehensive structural reform of the compensation frameworks would assist in striking a balance between societal well-being and the broader economic need to avoid the trending economic paradigm where people and the ecosystem do not seem to matter.

Adoption of a comprehensive structural compensation policy and the consequent legal framework will not be a grand vaccine to all the ailments pertaining to land acquisitions and compensations. However, such frameworks will play a significant role in uplifting the vulnerable and demonstrating the government’s willingness to chart an integrated economy based on the principles of the restoration, rather than the exploitation, of natural and human resources. This would be a crucial step in addressing the current problems facing the social capital and the social impact of a seemingly non responsive, disastrous and destructive economic system.

Post COVID-19, a comprehensive consolidated compensation policy and binding legal frameworks should be high on the political agenda in order to chart people oriented and centred development. This would ensure that Lesotho aligns her policies and regulatory frameworks are aligned to the Sustainable Development Goals (Agenda 2030) by building an economy, where people and the ecosystem truly matter.  

As always, the most decisive factor is the political willingness of the policy makers and the legislature. The country is in dire need to engender and realign an economy centred on the wellbeing of the people who are its greatest social capital and whose authority the state exists. This would be aligned to Sustainable Development Goals (Agenda 2030) which demand the global development policy discourse be human centred.


Under the Department of Social Justice, the Transformation Resource Centre (TRC) identified a problem with the compensation after expropriation scheme and it is advocating for structural reforms in that regard. That is to say, TRC is promoting and advocating for designing and adoption of policies and regulatory framework to ensure that the compensation schemes for expropriation are fit and able to realise the need to balance the economic need to improve the infrastructure or to engage in development projects without leaving the most vulnerable worse off. To this extent, the TRC has a draft National Compensation Policy ready to assist the government. The current essay is one of the 5 essays to be published as a series for 5 consecutive weeks. The purpose of these essays is to analyse and explain how expropriation of land and property are undertaken in an effort to clarify the dire need for formulation of a uniform comprehensive framework to influence stable, efficient and fair compensation practices. 

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