Grootfontein defends Redforce marriage
Municipality 'exhausted all other avenues'
Despite residents' misgivings, the Grootfontein municipality will not end its contract with a debt-collection agency.
In the wake of communities across the country revolting against local authorities enlisting the services of debt-collecting companies, the Grootfontein municipality says it will not terminate its contract with one. The municipality, which signed a contract with Redforce Debt Management on 5 April, said it has had enough of residents defaulting on their monthly municipal accounts.
The cash-strapped local authority also revealed that it is owed N$213 million.
This is contained in a media release issued last Friday by mayor Talitha Garises in response to various demonstrations and petitions by disgruntled residents who feel that Redforce will make life difficult for those who will be handed over to the debt-collecting company.
In their petition, the residents argued that the local authority should make use of the debt-collecting department within municipal structures instead of a third party.
They went on to accuse the local authority of not consulting the community prior to appointing Redforce.
“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.”
Exhausted all avenues
In its statement, the Grootfontein council said it had exhausted all possible avenues to get defaulting clients to pay their dues.
“Council encouraged and pleaded with residents, businesses and institutions to engage the finance department with the purpose of making financial arrangements towards settling outstanding debt as well as to avoid disconnection of municipal services. This humble request [has] seemingly fallen on deaf ears, while the disconnection of services resulted in another demonstration and petition. The current internal debt-management strategy has not yielded the desired results and, consequently, the debt has risen to N$213 million by March,” Garises wrote.
“It is against this background that the council resolved to procure the services of a debt collector,” she said.
Garises further explained that only accounts that are in arrears for 60 days 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 account handed over to Redforce. No houses and properties shall be repossessed [and] no disconnection of municipal services shall be effected on senior citizens and vulnerable community members,” she said.
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The cash-strapped local authority also revealed that it is owed N$213 million.
This is contained in a media release issued last Friday by mayor Talitha Garises in response to various demonstrations and petitions by disgruntled residents who feel that Redforce will make life difficult for those who will be handed over to the debt-collecting company.
In their petition, the residents argued that the local authority should make use of the debt-collecting department within municipal structures instead of a third party.
They went on to accuse the local authority of not consulting the community prior to appointing Redforce.
“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.”
Exhausted all avenues
In its statement, the Grootfontein council said it had exhausted all possible avenues to get defaulting clients to pay their dues.
“Council encouraged and pleaded with residents, businesses and institutions to engage the finance department with the purpose of making financial arrangements towards settling outstanding debt as well as to avoid disconnection of municipal services. This humble request [has] seemingly fallen on deaf ears, while the disconnection of services resulted in another demonstration and petition. The current internal debt-management strategy has not yielded the desired results and, consequently, the debt has risen to N$213 million by March,” Garises wrote.
“It is against this background that the council resolved to procure the services of a debt collector,” she said.
Garises further explained that only accounts that are in arrears for 60 days 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 account handed over to Redforce. No houses and properties shall be repossessed [and] no disconnection of municipal services shall be effected on senior citizens and vulnerable community members,” she said.
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