Grootfontein sends Redforce contract to AG for scrutiny
Residents bemoan ‘predatory’ debt collector
While the contract has been submitted to the Office of the Attorney-General for scrutiny, the debt-collection company will kick off operations at the town on 1 July.
Following petitions from residents and the Swapo Party Youth League’s (SPYL) condemnation of the appointment of Redforce Debt Management, the Grootfontein municipality has sent a contract between the two parties to the Office of the Attorney-General for scrutiny.
This was confirmed by acting CEO Indileni Lungameni, who this week told Namibian Sun that the contract as well as the council’s motivation for appointing Redforce was submitted.
This follows recent demonstrations and petitions by disgruntled residents who want the contract terminated.
The cash-strapped municipality signed a contract with Redforce on 5 April after all avenues to recover over N$213 million owed by residents had been exhausted. The debt-collection company was expected to commence operations in May, but due to backlash, the local authority placed the contract on hold.
However, according to Lungameni, Redforce will commence operations on 1 July.
‘Predatory’ Redforce
In a petition, residents raised concerns of their properties being repossessed and their lives being made miserable by Redforce. There are also allegations that residents were not consulted regarding the company’s appointment.
“Redforce has the potential to prey on individuals in dire financial circumstances, charging exorbitant fees for services that are often available for free or at a much lower cost through normal municipal debt-collection channels,” the petition read.
“Instead of offering sustainable solutions to debt problems, the Grootfontein municipality is pushing the community into repayment plans that will prolong their financial hardship or even worsen their debt burden in the long-run.”
No extra interest
In a recent communique, Grootfontein mayor Talitha Garises said only accounts that have been in arrears for 60 days or more will be handed over to Redforce. “Residents with outstanding debts and who have signed a written agreement with the finance department shall not be handed over to Redforce,” she said.
“No additional interest shall be added on the outstanding debt accounts handed over. No houses and properties shall be repossessed [and] no disconnection of municipal services shall be effected on senior citizens and vulnerable community members.”
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This was confirmed by acting CEO Indileni Lungameni, who this week told Namibian Sun that the contract as well as the council’s motivation for appointing Redforce was submitted.
This follows recent demonstrations and petitions by disgruntled residents who want the contract terminated.
The cash-strapped municipality signed a contract with Redforce on 5 April after all avenues to recover over N$213 million owed by residents had been exhausted. The debt-collection company was expected to commence operations in May, but due to backlash, the local authority placed the contract on hold.
However, according to Lungameni, Redforce will commence operations on 1 July.
‘Predatory’ Redforce
In a petition, residents raised concerns of their properties being repossessed and their lives being made miserable by Redforce. There are also allegations that residents were not consulted regarding the company’s appointment.
“Redforce has the potential to prey on individuals in dire financial circumstances, charging exorbitant fees for services that are often available for free or at a much lower cost through normal municipal debt-collection channels,” the petition read.
“Instead of offering sustainable solutions to debt problems, the Grootfontein municipality is pushing the community into repayment plans that will prolong their financial hardship or even worsen their debt burden in the long-run.”
No extra interest
In a recent communique, Grootfontein mayor Talitha Garises said only accounts that have been in arrears for 60 days or more will be handed over to Redforce. “Residents with outstanding debts and who have signed a written agreement with the finance department shall not be handed over to Redforce,” she said.
“No additional interest shall be added on the outstanding debt accounts handed over. No houses and properties shall be repossessed [and] no disconnection of municipal services shall be effected on senior citizens and vulnerable community members.”
[email protected]
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