The Redforce debt-collection company is not there to punish residents or create instability within municipalities countrywide.
Rather, they exist or are roped in as a last resort to assist with the rehabilitation and collection of
debts which are beyond the capacity and capabilities of municipalities to collect.
These were the observations of Grootfontein municipality’s acting CEO, Indileni Lungameni.
As things stand, the municipality is owed over N$215 million by residents, with unsettled rates and taxes making up the bulk of the inhabitants’ debt to the town.
“The bottomline here is that
the N$215 million needs to and must be collected with or without RedForce, and that is why I’m saying
the presence of RedForce here should [not] be our biggest concern, but the residents should rather engage us on how we can work together to ease the pressure on the town’s debt book,” the acting CEO stated at length.
He added: “Without collecting that money [N$215 million], it will be very difficult for us, as a municipality, to provide the expected services to the residents. The closing of potholes, collecting refuse, servicing new plots and providing basic services to the people comes with costs to the municipality – and that is why that money must be collected through mutual efforts”.
Lungameni shared with this publication that despite the residents’ continued outcry for the municipality to cut ties with RedForce, the town has decided that the debt-collectors must continue with collections, but in a more “softened manner”.
“That’s why we have not had any issues with our residents for the past months. Instead of going around and cutting off people’s water and electricity without offering any solutions, we told RedForce to rather sensitise the residents and allow them to come through, and decide on their accounts. We are doing things respectfully. So far, I’m happy with the response of the residents, and many are now coming through to make payments on their accounts, and plan on how to settle their debts. We are not enemies, and RedForce collectors are not here to create instability. They are here to help us with our internal capacity to collect the arrears,” he continued.
In April, about 400 residents took to the streets to demonstrate against the collectors, and denounce the municipality’s agreement with the entity to collect the arrears on its behalf.
Lungameni is of the firm opinion that the outstanding monies must be recuperated to allow the municipality to fulfil various strategic objectives such as the upgrading of roads, sewage systems and servicing of land.
Legal tussle
Meanwhile, the ongoing legal battle between the Walvis Bay Municipality and RedForce took a significant turn after the parties reached an in-principle settlement agreement.
However, High Court documents seen by this publication reveal that the settlement terms are yet to be finalised by the two parties.
In April, RedForce filed an urgent application in the Windhoek High Court to stop the termination of its contract to collect debt owed by ratepayers to the municipality.
The debt-collector was contracted for five years in September last year to collect over N$300 million owed by ratepayers.
However, the appointment resulted in an uproar from the community, who petitioned and called for the cancellation of the contract, while questioning the way it was awarded to RedForce.
As a result, councillor Ephraim Shozi tabled a motion to terminate the contract, leading to Metcalfe Beukes Attorneys being appointed to investigate the awarding of the contract.
This prompted RedForce in turn to approach the High Court to stop their contract from being terminated.
The motion, which was initially passed unopposed, was later withdrawn, resulting in Metcalfe Beukes Attorneys subsequently withdrawing from the ongoing court cases against RedForce.
“It is recorded that the parties report that they have, in principle, reached a settlement, and require time to conclude settlement terms. They request a postponement,” a court document dated 14 August states.
The matter has since been postponed to 25 September for a status hearing.
Both parties are now required to file a joint status report on or before 18 September 2024.
Contacted yesterday, Walvis Bay Mayor Trevino Forbes told New Era that he was in complete darkness about the latest twist.
“I am currently in Ethiopia. I do not know if we have reached an agreement… We have not been briefed yet,” he said.
Before his withdrawal from the case, Advocate Richard Metcalfe earlier revealed that the municipality had allegedly paid approximately N$17 million to RedForce within the first nine months of their agreement.
He also noted that on 22 September last year, RedForce allegedly received N$313 000, and over N$1 million on 13 October 2023, despite not having collected any penny on behalf of the council.
Metcalfe criticised the council’s decision to nullify the motion to terminate RedForce’s contract, arguing that it undermined the ongoing investigation.
He maintained that the appointment of RedForce was not in accordance with the law, and expressed concern that the council was condoning potential legislative contraventions.