The City of Windhoek is set to write off N$524 million in interest accrued by residents’ debts, providing much-needed relief for individuals struggling to keep up with their obligations.
The municipality plan includes a 100% write-off on both the capital and interest on debt for pensioners, benefiting 26,118 individuals with a monetary value of N$223 million. In addition to the pensioners’ relief, other residents will benefit from a 50% write-off on interest, while businesses will also enjoy a 50% reduction.
City of Windhoek Spokesperson Harold Akwenye said although the conditions of the amnesty are still being drawn up, the development will not impact the municipality’s finances.
“Despite the substantial debt, the City’s assets, valued at more than N$15 billion, provide a solid financial foundation,” he told The Brief. Quizzed on the current state of the municipality’s finances, currently standing at N$1.2 billion as of 31 October 2023, with N$963 million in arrears, Akwenye emphasised Windhoek’s commitment to responsible financial management.
“We feel good about our finances, and we’re paying our creditors on time. So yes, we have a healthy balance sheet,” he said.
This includes addressing debts such as free water debt, which amounted to N$60 million on 30 June 2022, and N$105 million on 30 June 2023. To address its ballooning debt, the City of Windhoek enlisted the services of a debt collector, a development that has, however, drawn anger from residents amid concerns that the City charges 20% per year on arrears while the debt collector charges 10% on amounts paid in debt.
The City has, however, maintained that despite objections from the public, it will continue with its current debt collection. The City of Windhoek maintains that it has been vigilant in controlling tariff increases, keeping them in line with the previous year, despite the challenges posed by high inflation.
To manage debts, the City is working towards transitioning to a fully prepaid business model, particularly for electricity services.
