CoW handles 90% of debt internally
Public questions need for RedForce outsourcing
The City of Windhoek (CoW) maintains that more than 90% of its debt collection is handled internally, with under 10% outsourced to RedForce Debt Management, which has so far recovered over N$300 million on the municipality’s behalf.In a statement, the City sought to correct what it called “misleading” claims of over-reliance on external agencies. “Less than 10% of arrears, mostly in the 90 to 120-day category, are handed over to external collectors such as RedForce,” the municipality said. “Pensioner accounts, especially those under the debt relief programme, are rarely handed over.”
RedForce has previously disclosed that it has recovered more than N$1 billion from ten local authorities nationwide since 2014, with over N$300 million collected for Windhoek. The City states that the arrangement is cost-effective because RedForce is paid only for the actual amounts recovered, thereby avoiding the fixed legal costs incurred under previous collection models.
During the 2023/24 financial year, the municipality wrote off more than N$524 million in debt to ease the burden on residents, mainly pensioners and other qualifying customers. However, the CoW said that some pensioners whose debts were previously cancelled have again fallen into arrears, collectively owing about N$20 million.
Procurement law compliance
The City stressed that all contracts, including those with RedForce, are subject to the Public Procurement Act and cannot be terminated arbitrarily. “It is important to stress that contracts, including that of RedForce, cannot be terminated without legal cause. Doing so would... expose Council to costly legal challenges, but also undermine institutional stability,” it stated.
This position follows an August directive from Urban and Rural Development Minister James Sankwasa, instructing all local authorities not to renew or sign agreements with RedForce. The minister cited “economic and political challenges and problems” caused to residents, saying the company’s collection methods had “a very negative effect” on citizens.
Similarly, Katima Mulilo CEO Raphael Liswaniso has emphasised that all procurement-related matters, including debt collection contracts, fall under the Public Procurement Act, and that any directive conflicting with the Act would be unlawful.
Public pushback
Despite the City’s defence, some residents remain unconvinced. Concerned citizens have questioned the logic of outsourcing such a small fraction of debts, arguing: “If the City of Windhoek’s internal debt recovery department is handling 90% of debtors, what is the use of sourcing the services of external debt collectors for merely 10%? Just remove RedForce and take over the remaining 10%.”
The debate has now evolved beyond numbers into a governance and legal compliance issue, with the City seeking to protect its contractual obligations under procurement law, while public pressure mounts for it to reclaim full control over debt collection and do away with the middleman that has been under scrutiny from the public over its debt retrieval methods, which citizens view as further trapping them in debt.