RedForce fallout: Sankwasa’s directive stirs tension at local authorities

Various local authorities have raised concerns over a government directive to discontinue its contracts with RedForce Debt Management.

This comes after minister of urban and rural development James Sankwasa directed all municipalities and town councils not to renew their contracts with the debt-collecting agency.

The minister cited economic and political issues caused by the company’s operations.

In a directive issued on 4 August, the minister instructed local authorities which have not yet entered into agreements with RedForce to refrain from doing so.

Several state-owned enterprises and local authorities have contracted RedForce to collect outstanding debt of more than N$2 billion.

‘NO BASIS’

Deputy Okahandja mayor Asker Aupindi says Sankwasa’s directive for town councils to discontinue their contracts with RedForce is confusing.

Speaking to Desert FM yesterday, Aupindi said the written directive does not feature the minister’s signature.

“In the culture we are coming from and as we understand corporate governance, the ministry is not the one who has to sign whatever he is sending to local authorities,” he said.

He said the town can therefore not adhere to the directive.

“There is no basis or power that allows the minister to do so, unless he comes out saying he is writing the letter based on which article,” Aupindi said.

He said the minister’s directive will not get the blessing of any local authority in the country, adding that Sankwasa is using his directive to campaign for Swapo.

‘OVERREACH’

Affirmative Reposit-ioning (AR) spokesperson George Kambala yesterday said Sankwasa has no power to get involved in local authority operations, calling it over-reach.

“Sankwasa may have powers to fire councillors, but he cannot dictate who local authorities should hire or fire. I don’t think there is anywhere where it says a minister can get involved in local authorities’ day-to-day operations,” he said.

Kambala said Sankwasa seems to be in “revenge mode” for failing to become a chief at Katima Mulilo.

He said local authorities need to make money to provide services.

Kambala added that the City of Windhoek has a debt-collection department which perhaps requires reform.

In response to the directive recently published in Namibian Sun, Katima Mulilo chief executive Raphael Liswaniso said: “It is not lawful.”

He referred to the Public Procurement Act’s objectives which should take precedence.

“This implies that if a ministerial directive contradicts the provisions of the Public Procurement Act, the act prevails, thereby rendering such a directive unlawful,” he said.

Ondangwa Town Council chief executive Ismael Namugongo this week said the council will engage the minister to seek further clarification on the scope and intent of his directive.

“He is the minister, and part of his role is to issue directives. However, the decisions we make at the council level are institutional,” he said.

“If the directive simply states that we should not renew, we need to discuss it thoroughly and consult with the minister to understand whether he is referring specifically to RedForce, or to debt collection as a whole,” he said.

Namugongo said debt collection in Namibia is not exclusive to RedForce.

“Ondangwa’s policy includes a clause that outlines steps to be taken against those who owe the council money. If the minister’s directive affects that clause, we need clarity. Is he asking us to stop using RedForce specifically, or is he instructing us to remove the legal action clause entirely?

“Our role is to implement policy, but we must do so with the proper understanding,” he said.

Oshakati mayor Leonard Hango said the town’s debts are no longer collected by RedForce after its contract with the debt collector came to an end last June.

“We don’t have a contract with RedForce, we have a debt-collection department under finance,” he said.

Grootfontein mayor Talitha Garises this week said the council would decide on the minister’s directive.

Outapi Town Council spokesperson Joolokeni Haidula said the town had a contract with RedForce from 1 January 2020, which ended in December 2021.

Rundu mayor Gabriel Kanyanga said the council has attempted to end its contract with RedForce but the agency took the town council to court, citing it had breached their contract.

“We are fighting with RedForce. We are trying to push them away. As we speak, the court is yet to pronounce itself on that,” he said.

WELCOME, BUT PREMATURE

Walvis Bay mayor Trevino Forbes says the municipality welcomes the directive, citing it has been a long time coming, but calls for internal revamping of all local authorities’ debt-collection departments.

“We do not have a problem with the directive, however, if we just prematurely end the RedForce contract without revamping the internal debt-collection department within the municipalities, residents will continue to misbehave in not paying their debts.

“Hence, we should reform these departments to take over and also learn from the positives and negative impacts of RedForce in collecting debts,” he said.

Forbes says local authorities need to collect debts to provide services to the masses and to keep the municipality up and running.

CAPACITY

Lüderitz Town Council mayor Phil Balhao says although the council does not make use of RedForce, there is no need for a middleman and that local authorities should be in charge.

Middlemen often do not understand the plight of residents, he says.

“This middleman often brings hate towards municipalities from the residents, and I strongly do not believe in RedForce as a middleman,” he says.

Balhao further says debt collection should be handled by municipalities or town councils because they have the capacity to do so.

“With a little training and resources they can do a great job and offer residents affordable services.”

ASSESSING DIRECTIVE

City of Windhoek mayor Ndeshihafela Larandja yesterday said the RedForce matter is part of the council’s meeting agenda slated for 7 August. The council will provide an update on the outcomes of the meeting at a later stage, she said.

Meanwhile, Mariental chief executive Paul Nghiwilepo said the town council does its own debt collection.

He said the planned installation of prepaid water meters would help to collect debt in a more affordable and effective way.

“This system is programmed to not only help us collect debts, but also help residents avoid accumulating debts. Because once your water finishes, you are then required to refill again,” he said.

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