Cash-strapped LEC hikes staff salaries

The cash-strapped Lesotho Electricity Company (LEC) has announced a three percent salary increase for its employees.

LEC acting managing director, Nathaniel Maphathe, told members of staff in a memorandum dated June 23, 2025 that the LEC Board of Directors had resolved that there should be an upward salary adjustment to cushion them against the rising cost of living.

“This method was adopted temporarily to manage the prevailing gaps amongst salary grades and also to ensure a fair and equitable distribution of the adjustment rate.

“Employees are encouraged to contact supervisors or human resources office for more details,” the memorandum read.

The salary adjustment comes as the company reels under a staggering M800 million debt and a loss of M290 million for the 2024/25 financial year.

In addition to owing over M700 million to power suppliers Eskom of South Africa and EDM of Mozambique, LEC is facing significant debt challenges. Specifically, they are owed a total of M265 million, with M175 million owed by post-paid consumers (including the government, embassies, and the industrial sector) and M90 million by sundry debtors. 

In an interview with this publication yesterday, the administration manager of LEC, Makhetha Motšoari explained that the salary percentage increase was influenced by factors affecting the company’s operations, including operating costs covering vehicles and equipment, amongst others.

The national power utility then sought approval from the Lesotho Electricity and Water Authority (LEWA), which gives the final say after ensuring the percentage hike does not cripple the company, he said.

Motšoari noted that while financial sustainability is crucial, employee welfare cannot be overlooked.

According to Motŝoari, LEWA approved an increase of three percent as follows:

• Gardeners and cleaners (3%)
• Clerks and assistants (2%)
• Managers (1%)
• Executive management and the Managing Director (0%)

He added that the decision was reasonable, especially considering that civil servants were only given a two-percent increase, while clothing and textile factory workers also received salary adjustments, in line with inflation.

LEC employees, however, did not receive any bonusesthis year due to the company’s financial constraints, Motŝoari pointed out.

Motŝoari’s sentiments were endorsed by a member of the Public Accounts Committee (PAC), Tŝeliso Moroke, whoacknowledged longstanding structural issues within LEC, especially between executive management and general staff.

Moroke said the three percent increase is a step towards addressing those problems. “PAC had already recommended that the LEC Board take action on these concerns,” he told theReporter yesterday.

He noted that the acting LEC executive management continues to be paid under a 2015 policy, which stipulates that any employee appointed to act in a higher position is entitled to be paid the difference between their substantive salary and that of the acting position.

This small salary increment is not a major issue, especially since bonuses were declined due to the company’s challenges, he indicated.

Moroke added that the government’s decision to raise civil servant salaries by two percent also underscores the need to support workers, even in difficult financial times.

Meanwhile, the PAC recently urged the LEC to do the right thing and uphold financial accountability, particularly in response to concerns surrounding the travel and accommodation expenses of its board chairperson, Thabo Khasipe.

Khasipe, who is currently based in Namibia, reportedly had his air tickets and lodging paid for by LEC whenever the board of directors meets in Lesotho, a move PAC believes goes against the company’s own governance rules.