Tshwane's 2025/2026 budget: A risky reliance on property tax revenue
The Freedom Front Plus expressed concerns about City of Tshwane's 2025/2026 budget, citing its dependence on property tax revenue and potential financial risks.
Image: Jacques Naude/Independent Newspapers
The Freedom Front Plus has warned that the City of Tshwane's fully-funded budget for the 2025/2026 financial year relies heavily on increased property tax revenue, making its funding status more of an assumption than a certainty.
Deputy Mayor Eugene Modise last week presented a R54.6 billion budget, comprising a R2.4 billion capital budget and a R52.2 billion operational budget, describing it as pro-poor and focused on service delivery.
The multiparty coalition partners in Tshwane, including the ANC, EFF, and ActionSA, praised him for presenting a fully funded budget that had been endorsed by National Treasury.
'This is the first fully funded budget since 2022 and represents a significant milestone in our turnaround strategy for Tshwane. It is a clear indication of our coalition commitment to responsible governance, sound financial management and inclusive service delivery to all communities in the City,' the parties said.
FF Plus councillor Peter Meijer criticised the funded budget, saying it is primarily based on increased property tax revenue, which has already drawn criticism from the party.
'At this stage, it can only be considered an assumption since the process surrounding the revision of the valuation roll, which determines the increase in property tax collection, has not yet been finalised,' he said.
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Meijer noted that the budget speech's mention of settling Eskom debt has been praised, but argued this is simply compliance with a court order, not an actual achievement.
'If the court order is not complied with, it could plunge Tshwane into a financial crisis,' he said.
He also said reducing the debtors' book from nearly R30 billion to R25 billion is being touted as a success, attributed to improved revenue recovery and a recent overdue debt write-off scheme.
'However, since no concrete figures have been provided, the question remains whether collection efforts have been successful in comparison to the debt write-off, and what impact this has on cash flow,' he said.
He warned that if creditor obligations are not settled, they could undermine any perceived financial progress and limit Tshwane's ability to allocate resources effectively.
"Persistent creditor liabilities can also affect investor confidence, as they signal potential liquidity challenges. Without clear strategies for settling these debts while maintaining financial stability, the risk of cash flow shortages increases—making budget sustainability a pressing concern,' he said.
Kholofelo Morodi, Member of the Mayoral Committee for Corporate and Shared Services, welcomed the fully-funded budget, highlighting its commitment to critical infrastructure projects that will improve electricity stability, connectivity, and public safety.
Morodi, who is a political head for Region 4, said the investment demonstrates a commitment to providing residents with reliable infrastructure that meets their needs.
'Key initiatives such as the Eldoraigne, Olievenhoutbosch, Noordwes, Claudius, and Cornwall Hill Substations, as well as the Louwlardia supply augmentation, play a crucial role in reinforcing our power network,' she said.
She added that installing remote terminal units and fibre will enable real-time monitoring and improve service responsiveness, while high-mast lighting will enhance community safety by illuminating public spaces.
The multiparty coalition parties said: 'We particularly commend the decision not to rely on borrowing. The positive revision of the City's credit outlook, and the transparent and consultative process followed in arriving at this credible financial plan.'
rapula.moatshe@inl.co.za
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