Rundu gets green light to end Redforce contract
Company says it is not getting the necessary support
Redforce was expected to rake in a minimum of N$5 million a month from Rundu's defaulters, however, the last time the company managed to meet this target was in February 2021.
The Office of the Attorney-General (AG) in April gave the Rundu town council the green light to terminate its contract with Redforce Debt Management, which stands accused of failing to meet its N$5 million monthly target since March 2021.
The debt collector is also facing the axe because it allegedly breached the agreement as far as data collection is concerned.
The town council - through the urban and rural development ministry - sought a legal opinion from the AG’s office last November following Redforce’s poor performance for March to October in hopes of terminating the contract.
Redforce was expected to rake in a minimum of N$5 million a month from Rundu’s defaulters, however, the last time the company managed to meet this target was in February 2021.
According to a letter dated 19 April, AG Festus Mbandeka advised urban and rural development minister Erastus Uutoni that the debt collector indeed breached the contract it entered into with the town council.
“Redforce did not meet the target amount of N$5 million as provided in annexure A from March 2021 to October 2021 and furthermore. Redforce did not collect the data as provided for in terms of Clause 6.9 and 6.10, therefore this amounts to material breach of contract,” Mbandeka wrote.
“We therefore wish to advise that council may terminate the memorandum of agreement.”
Sub judice
When contacted for comment, Rundu CEO Nathaneal Olavi said the matter is sub judice as the council has yet to meet to discuss it.
He, however, indicated that a meeting might take place this month.
“We cannot discuss that now as council did not take a decision on the matter. We need to first have a meeting where we discuss this issue and then only a formal submission will be tabled to the management committee to make a recommendation to the full council.
“For now, the matter is sub judice, [so] as for now there is no direction.”
Missing targets
Meanwhile, during a council meeting last week, office-bearers were furnished with a report on Redforce’s performance by the town’s finance department, which showed that the debt collector has continued to fail to meet its target.
According to the document, dated 28 June and seen by Namibian Sun, Redforce has not made its target once this year.
The highest amount was collected in March when N$3 802 942.81 was received from the town council’s defaulters, while in January, it collected the lowest amount of N$2 555 022.08.
However, the document on Redforce’s performance indicated that the company has submitted a number of reports suggesting that it is not getting the necessary support from the local authority.
“Redforce has submitted multiple reports lamenting the lack of support from council as one of the reasons why they have not been able to meet their monthly target. There has always been pushback from community members in protest of Redforce’s appointment and activities,” the report read.
“Notwithstanding the foregoing, one can conclude that if Redforce had the necessary support from all parties involved, collections would be higher.
“It is therefore our considered opinion that the issues raised in the reports are indicative of the challenges currently on the ground and unless those challenges are addressed by council, we will never be able to recover all the monies owed to us, much less improve service delivery.”
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The debt collector is also facing the axe because it allegedly breached the agreement as far as data collection is concerned.
The town council - through the urban and rural development ministry - sought a legal opinion from the AG’s office last November following Redforce’s poor performance for March to October in hopes of terminating the contract.
Redforce was expected to rake in a minimum of N$5 million a month from Rundu’s defaulters, however, the last time the company managed to meet this target was in February 2021.
According to a letter dated 19 April, AG Festus Mbandeka advised urban and rural development minister Erastus Uutoni that the debt collector indeed breached the contract it entered into with the town council.
“Redforce did not meet the target amount of N$5 million as provided in annexure A from March 2021 to October 2021 and furthermore. Redforce did not collect the data as provided for in terms of Clause 6.9 and 6.10, therefore this amounts to material breach of contract,” Mbandeka wrote.
“We therefore wish to advise that council may terminate the memorandum of agreement.”
Sub judice
When contacted for comment, Rundu CEO Nathaneal Olavi said the matter is sub judice as the council has yet to meet to discuss it.
He, however, indicated that a meeting might take place this month.
“We cannot discuss that now as council did not take a decision on the matter. We need to first have a meeting where we discuss this issue and then only a formal submission will be tabled to the management committee to make a recommendation to the full council.
“For now, the matter is sub judice, [so] as for now there is no direction.”
Missing targets
Meanwhile, during a council meeting last week, office-bearers were furnished with a report on Redforce’s performance by the town’s finance department, which showed that the debt collector has continued to fail to meet its target.
According to the document, dated 28 June and seen by Namibian Sun, Redforce has not made its target once this year.
The highest amount was collected in March when N$3 802 942.81 was received from the town council’s defaulters, while in January, it collected the lowest amount of N$2 555 022.08.
However, the document on Redforce’s performance indicated that the company has submitted a number of reports suggesting that it is not getting the necessary support from the local authority.
“Redforce has submitted multiple reports lamenting the lack of support from council as one of the reasons why they have not been able to meet their monthly target. There has always been pushback from community members in protest of Redforce’s appointment and activities,” the report read.
“Notwithstanding the foregoing, one can conclude that if Redforce had the necessary support from all parties involved, collections would be higher.
“It is therefore our considered opinion that the issues raised in the reports are indicative of the challenges currently on the ground and unless those challenges are addressed by council, we will never be able to recover all the monies owed to us, much less improve service delivery.”
[email protected]
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