Legal opinion stalls Rundu-Redforce split
Debt collector fails to meet targets
Despite being desperate to cut ties with Redforce Debt Management, the Rundu town council is still waiting for a legal opinion on whether it can terminate the contract without consequences.
It’s been five months since the Rundu town council sought a legal opinion from the Attorney-General’s Office on whether it can terminate a contract with Redforce Debt Management, but the local authority has yet to receive a response. This after the debt collecting company failed to meet its monthly targets.
As per the contract, Redforce is expected to collected a minimum of N$5 million a month, however, the company has been failing miserably in its task. The last time it managed to meet its target was February 2021, when it collected N$9 827 129.
Rundu mayor Gabriel Kanyanga said it is on this basis that a motion was tabled last November for council to seek a legal opinion on whether there would be legal setbacks if they terminate the three-year contract with Redforce, which is set to end next year.
“We are still waiting for the response. The Attorney-General has not responded to our letter yet,” Kanyanga said.
“We wanted to see if there is any legal obligation that will block us from terminating the contract, seeing that they are not reaching the targets.”
Several attempts to get comment from Redforce CEO Julius Nyamazana has proved futile - for weeks.
Tricky situation
The debt management company landed the contract in October 2020 to recover about N$450 million owed to the council by stakeholders.
Despite not meeting its monthly N$5 million target for over a year, Redforce has earned almost N$10 million in commission from the funds it has recovered.
While the local authority is desperate to cut ties with the debt collector, it last year attempted to engage councillors on how to work together to recover the owed monies successfully.
Its attempts fell on deaf ears. In fact, council invited Nyamazana to a meeting on 24 August, but it did not take place despite the CEO having travelled from Windhoek to Rundu.
This was confirmed by Nyamazana in a letter to council dated 31 August, in which he expressed disappointment regarding council’s conduct as far as the contract was concerned.
The letter, addressed to Rundu CEO Olavi Nathanael, took particular aim at the conduct of office-bearers whose public statements are allegedly putting Redforce’s reputation at risk.
Public outcry
Namibian Sun also reported that Redforce was troubled by actions of the council after the company tried to disconnect water at a shopping mall which was in arrears, but council reconnected the water again.
Beyond some councillors disagreeing with the contract between council and Redforce, the issue was also met with public outcry, with a number of protests - led by pressure groups – taking place at the riverside town this year.
Last month, the Swapo Party Youth League’s Kavango East leadership called for the termination of the contract.
[email protected]
As per the contract, Redforce is expected to collected a minimum of N$5 million a month, however, the company has been failing miserably in its task. The last time it managed to meet its target was February 2021, when it collected N$9 827 129.
Rundu mayor Gabriel Kanyanga said it is on this basis that a motion was tabled last November for council to seek a legal opinion on whether there would be legal setbacks if they terminate the three-year contract with Redforce, which is set to end next year.
“We are still waiting for the response. The Attorney-General has not responded to our letter yet,” Kanyanga said.
“We wanted to see if there is any legal obligation that will block us from terminating the contract, seeing that they are not reaching the targets.”
Several attempts to get comment from Redforce CEO Julius Nyamazana has proved futile - for weeks.
Tricky situation
The debt management company landed the contract in October 2020 to recover about N$450 million owed to the council by stakeholders.
Despite not meeting its monthly N$5 million target for over a year, Redforce has earned almost N$10 million in commission from the funds it has recovered.
While the local authority is desperate to cut ties with the debt collector, it last year attempted to engage councillors on how to work together to recover the owed monies successfully.
Its attempts fell on deaf ears. In fact, council invited Nyamazana to a meeting on 24 August, but it did not take place despite the CEO having travelled from Windhoek to Rundu.
This was confirmed by Nyamazana in a letter to council dated 31 August, in which he expressed disappointment regarding council’s conduct as far as the contract was concerned.
The letter, addressed to Rundu CEO Olavi Nathanael, took particular aim at the conduct of office-bearers whose public statements are allegedly putting Redforce’s reputation at risk.
Public outcry
Namibian Sun also reported that Redforce was troubled by actions of the council after the company tried to disconnect water at a shopping mall which was in arrears, but council reconnected the water again.
Beyond some councillors disagreeing with the contract between council and Redforce, the issue was also met with public outcry, with a number of protests - led by pressure groups – taking place at the riverside town this year.
Last month, the Swapo Party Youth League’s Kavango East leadership called for the termination of the contract.
[email protected]
Comments
Namibian Sun
No comments have been left on this article