The City of Windhoek (CoW) has maintained its contractual decision with Red Force debt collectors to collect an accumulated debt of N.dollars 255 million owed by 20 000 pensioners.
This follows a petition submitted by over 300 pensioners from Katutura on 27 June 2023 for the removal of Red Force.
Briefing the media on the matter here Tuesday, CoW Deputy Mayor, Magdelena Lombardt said the accumulated debt has placed a significant financial burden on the City, thus the appointment of Red Force to collect debt on behalf of it was deemed more financially viable.
In the petition, the pensioners have also demanded the removal of current debts stressing that they are unable to pay off their accumulated water bills after the COVID-19 pandemic, which has resulted in CoW cutting off their water and electricity as well as contracting Red Force debt collectors to recover debt from the pensioners.
Lombardt said CoW is owed N.dollars 1.2 billion in total by 58 000 defaulters in arrears of which 20 000 are pensioners, noting that CoW is currently considering various debt management modalities, including working on a proposal to write off debt for pensioners and interest for all residents.
“The City has the mandate to suspend prepaid services to recover outstanding debts for various services rendered,” she said.
She explained that the City charges 20 per cent per annum on arrears while Red Force only charges 10 per cent on actual payments received by the council, noting that the previous collection process by CoW proved to be costly with no surety of financial benefit to the city or client, thus the appointment of Red Force on behalf of CoW was deemed more financially viable.
Lombardt further noted that a principal decision was taken by the City to charge only a 15 per cent down payment for pensioners, instead of the 33.33 per cent requirement as per the City’s credit control policy.
She equally noted that they were concerned about residents who are not pensioners and who use situations to petition and rally support whilst having arrears themselves, noting that such defaulters will be thoroughly investigated and addressed.
Source: The Namibian Press Agency