The UK Department for International Development (DfID) and USAid, the American aid agency, have been accused of ignoring evidence of human rights abuses allegedly linked to their support for a multibillion-dollar social services programme in Ethiopia.

A report published on Wednesday by the US-based thinktank the Oakland Institute details a long list of grievances presented to aid officials from the UK and US by communities in the Lower Omo Valley in southern Ethiopia. They claim they suffered intimidation, beatings, rape, forced evictions and other abuses as a result of the government's controversial "villagisation" resettlement programme, which seeks to clear land to make way for commercial investments.

"Donor agencies were given highly credible first-hand accounts of serious human rights violations during their field investigation, and they have chosen to steadfastly ignore these accounts," says the report, written by Will Hurd, an NGO worker who served as a translator for a team of DfID and USAid officials on a visit to the region in January 2012.

Transcripts of parts of these meetings, which have been made public alongside the report, show community members ignored aid officials' questions about the state of education, development and health clinics, and repeatedly tried to bring the conversation back to the subject of abuse.

According to the transcripts, one of the two DfID representatives present told community members: "[O]bviously we agree that it's unacceptable – beatings and rapes and lack of consultation and proper compensation … [I] would raise very strongly with the government as the wrong way to do this. It just simply is wrong. It simply is wrong. Obviously, we totally agree and it's worrying to hear about those things."

The allegations linking claims of abuse to aid funding centre around the relationship between Ethiopia's Protection of Basic Services (PBS) programme and the government's Voluntary Resettlement programme (villagisation).

PBS, which has the support of several large international donors, is a multibillion-dollar social services project described as "expanding access and improving the quality of basic services in education, health, agriculture, water supply and sanitation". Human rights campaigners have attacked donor support for PBS on the grounds that funds are also being used to plan and implement the villagisation programme as aid money is being spent on health, education and other services in the resettlement sites.

"The problem is that these services will not be provided unless the people accept resettlement," says the Oakland Institute report, which insists the two programmes are connected and cannot be neatly separated by donors who do not want their funding to appear tainted.

Leigh Day & Co, the London-based law firm that last September took up the case of an Ethiopian farmer, "Mr O", who claims he was forcibly evicted from his farm in Gambella, in the west of the country, argues that through its support for PBS, DfID helps finance the infrastructure and salaries required under villagisation.

Another report, also published by the Oakland Institute on Wednesday, adds: "It is difficult not to conclude that DfID and USAid have decided to support the current policy of the Ethiopian government, their strategic ally in the Horn of Africa, despite the major human rights abuses this government is perpetrating in the Lower Omo Valley.

"By doing so, they are willful accomplices and supporters of a development strategy that will have irreversible devastating impacts on the environment and natural resources and will destroy the livelihoods of hundreds of thousands of indigenous people."

The UK spent £261.5m on aid to Ethiopia in 2012-13. In DfID's annual report, it said: "Ethiopia has experienced impressive growth and development in recent years, but remains poor and vulnerable. The UK government continues to track and raise concerns about limitations on civil and political rights. The government of Ethiopia's approach to political governance presents challenges."

Last November, the development secretary, Justine Greening, said DfID had not been able to substantiate allegations of human rights abuse received during its visit to Lower Omo in January 2012, and that it would return to the area to examine these further. This has yet to happen, though there are plans for a visit this year.

A DfID spokesperson said on Wednesday: "It is completely wrong to suggest that British development money is used to force people from their homes. Our assistance has helped millions of people in Ethiopia, a country that has suffered famine and instability over many decades. We condemn all human rights abuses and, where we have evidence, we raise our concerns at the very highest level …

"To suggest that agencies like DfID should never work on the ground with people whose governments have been accused of human rights abuses would be to deal those people a double blow."

Meanwhile, the World Bank has decided to undertake a full investigation into allegations that its support for the PBS programme has financed human rights abuses in Ethiopia.

The bank has previously denied any connection between PBS and villagisation, but its internal watchdog, the Inspection Panel, argues that this is not a "tenable position", saying: "The two programmes depend on each other, and may mutually influence the results of the other."

The panel had recommended an investigation earlier this year after receiving a complaint from indigenous communities in Gambella describing incidents of intimidation, beatings, arrest and torture.