• Government

CoW sticks to RedForce guns

- 2023-09-13 08:05:00

The Windhoek municipality is steadfast in its decision to retain RedForce as its debt collector. Furthermore, no change will be made to RedForce's contract or its collection methods.
The deputy mayor of the capital, Magdalena Lombardt, made this clear yesterday at the city council's conference hall.
"No pensioner's municipal accounts are handed over to RedForce, and no interest is charged for accounts of any resident handed over to RedForce, apart from the collection fees of 10% of each overdue payment made," she insisted.
Lombardt added that the municipality even has the right to suspend the pre-paid supply of water and power in order to collect debts.
"The previous collection process was expensive and without certainty to offer any financial benefit to the city or the customer."
So, hiring RedForce to collect debt on behalf of the city is considered more financially viable, she said.
According to Lombardt, the capital previously used legal services where clients' accounts were handed over to law firms.
"Accounts handed over to outside attorneys for judicial collection have resulted in large amounts of debt, which represents a huge financial burden for the city and its clients, as the attorneys claim legal fees, even though they do not collect the debt from the defaulters ,” she said.
Lower interest charges
According to the deputy mayor, RedForce only demands 10% for every overdue payment that a defaulter remits to the Windhoek municipality, which is less than the 20% interest that the city itself charges annually on debt.
Lombardt's statement follows a protest march last week and the handing in of a complaint with proposed solutions for forced interruptions of power and water supply and apparently even seizure of houses for debt collection in central Katutura.
Residents demanded action and also marched to the Ministry of Urban and Rural Development's office to give the minister 72 hours to intervene.
The acting chief executive, Faniel Maanda, says the statement only reflects the municipality's view.
The municipality offers to install pre-paid power meters for pensioners free of charge, should they apply for it, Lombardt said.
Prepaid water meters can be paid off in five years at 11% interest, she added.
Residents are encouraged to send in meter readings themselves by SMS to avoid the use of estimates, to monitor consumption and to be able to detect leaks quickly, she advised.
Meanwhile, the city council is working on a proposal to write off senior citizens' debts, the deputy mayor said.
Still, the municipality cannot suspend interest on debt, although pensioners can make a repayment arrangement with a 15% deposit, rather than the 33% required by the municipality's credit control policy, she said.
Residents owe the municipality approximately N$1.2 billion from approximately 68 000 accounts.
According to officials from the financial management department, about 20 000 pensioners owe a total of about N$255 million.
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