Mpanzu initially joined on loan from the Hammers as a centre-back, going onto be a regular in the side that won promotion from the Conference in the 2013-14 campaign.
He has gone onto make 189 appearances in a Hatters shirt, scoring ten times, and Harford praised the impact Pelly still has.
"Pelly is vital – his strength and power in midfield," the interim boss explained. "I remember watching him when I was doing my scouting with Pelly playing centre-half for West Ham Under-23s, so my vision for him goes a long way back.
"Everyone knew he was going to have a bright future, but I thought that might be as a centre-half, but he's adapted to the role we have asked him to do and he's adapted very well. He's a real, real handful on his day, arguably one of the best midfielders in the league, without a doubt."
The Town have added to their squad this month, with George Moncur and George Thorne joining the Hatters' midfield, whilst the only exit at Kenilworth Road saw young defender Jack James joining Havant & Waterlooville on loan.
Harford said: "It's massive [that we haven't had to let go of a key player]. We've got a good squad, we've got good players, me in the interim position as we are, I'd like to win games and keep on winning. I wouldn't want to lose any of the players in all fairness, any of them.
"I think there has been a lot of attention on all of our players, even when we have been climbing the table. I think we have a good way of playing, have a good structure to the team and people like the way the team play and we've got some good footballers and some good players who will be big assets for other clubs. But we'll try and hang on to them and hopefully we can get where they want to be at the end of the season.
"The lads' attitude is spot on and they want to do well for the club they're at. They're not looking to move on, they're looking to be successful here and that's what we want."
The former England striker is also hopeful to bolster his squad with a player or two, but won't be acting until after the Portsmouth game tomorrow evening.
He said: "We are looking to bring one or two in, we're not going to do any business until after the game on Tuesday, then we'll have 48 hours to hopefully bring in some of our targets. We have got things in process in terms of offers for players that we'd like to try and acquire, so we are in the market so to speak.
"These things nowadays take a long, long time to get over the line you know, if it lingers on. We'll look to bring the right type in, that's the main thing. We want to bring the right type into the environment that we've got. It's a good environment around here and we need the right type of player, i.e. character, ability and obviously someone who's going to come in and help us try and achieve what we want."
