The City of Johannesburg is facing a significant dilemma as the National Treasury temporarily freezes a large portion of its funding, forcing the municipality to reassess its financial strategy amid increasing service delivery challenges.
The National Treasury's decision to withhold portions of the equitable share from several Gauteng municipalities, including the City of Johannesburg, Emfuleni, Lesedi, Sedibeng District Municipality, Merafong City and Rand West City, should not have come as a surprise. It is the predictable outcome of years of financial mismanagement, weak governance and a persistent failure to act on repeated findings by the Auditor-General (AG).
The Auditor-General's 2024/25 Consolidated General Report on Local Government Audit Outcomes, read together with the National Treasury Municipal Financial Management Act (MFMA) Compliance 2024/25 Report, paints a deeply concerning picture of local government in Gauteng. While a handful of municipalities improved their audit outcomes, the overall trend remains one of financial deterioration.
The City of Ekurhuleni, the City of Tshwane and Emfuleni Local Municipality all regressed to qualified audit opinions. Only one of Gauteng's eleven municipalities was assessed as being in good financial health. Six municipalities were classified as financially concerning, and four were considered financially unfavourable.
