One thing I have noted about our new president is how he manages the various aspects of state governance. Many news article have come out about consultants being hired for various important aspects of state such as tax programs, metro planning and now debt collection. To me this is a sign of good business practice. In past administrations local groups would be hired to assess various aspects and their knowledge and scope was fairly limited. This administration is managed in a more professional manner where hiring the best minds from proven consulting firms is the practice. Although the cost may be higher initially, in the long term a solid foundation is put in place and built on. I would imagine in the case of debt collection, the companies will be rewarded with a percentage of what they collect. With over $590 million in collections expected, these could be very lucrative contracts.
From La Prensa;
The government seeks to cover about $590 million in unpaid bills with the aid of three private companies that specialize in debt collection management.
The measure was announced by the Director of Revenue at the Ministry of Economy and Finance, Luis Cucalón, who demonstrated enthusiasm for the decision to hire 300 auditors to streamline collection processes.
Ruben Bustamante, partner and tax specialist at Bustamante & Bustamante, said the initiative could provide for a more efficient system of tax collection, which would in turn assist the government's cash flow.
He commented that Chile, Puerto Rico and several countries in Europe have employed similar collection services with positive results.
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