‘Barrelling towards collapse': Concerns mount as Godongwana puts pressure on Morero to fix Joburg's finances
Finance Minister Enoch Godongwana has given Johannesburg Mayor Dada Morero a two-week deadline to address the city's escalating financial troubles.
The City of Joburg continues to struggle financially, despite an increased budget of R89 billion for the 2025/2026 financial year.
Adding to the crisis, the metropolitan municipality has been without a Finance MMC since African Independent Congress (AIC) councillor Margaret Arnolds vacated the position a month ago following her re-election as council speaker.
Godongwana demands action from Morero over City of Joburg's finances
The situation has become so dire that Godongwana sent a strongly worded letter to Morero on 30 July, reprimanding the mayor for failure to address unnecessary spending and repeated non-compliance with the Municipal Finance Management Act (MFMA).
The municipality incurred R1.4 billion in unauthorised expenditure, R22 billion in irregular expenditure, and R705 million in fruitless and wasteful expenditure in the last fiscal year.
ALSO READ: Joburg mayor Dada Morero survives motion of no confidence
According to the Sunday Times, Godongwana has set a 14 day deadline for Morero to propose a plan addressing the financial issues and to hold accountable those responsible for the mismanagement.
The letter warns that failure to act may lead to National Treasury invoking Section 216(2) of the Constitution, which would allow the department to withhold grant funding from the city.
DA warns of collapse
The Democratic Alliance (DA) has expressed concern over the developments, emphasising that the minister's warning was 'no empty threat' and should not be taken lightly.
'Johannesburg's R89 billion budget is funded through a mix of grants, loans, revenue collection and conditional grants.
'Conditional grants, which form a significant portion of the city's funding, can only be spent on what they are intended for.
'If Treasury pulls back or suspends these funds, as the minister warns in his letter, the city's ability to deliver the little basic services it is currently able to deliver, will collapse entirely,' DA Joburg caucus leader Belinda Kayser-Echeozonjoku said in a statement on Sunday.
READ MORE: ActionSA-ANC slams Zille's plans for Joburg: 'They do not believe in black excellence'
Kayser-Echeozonjoku claimed that the DA had consistently warned both Morero and the national about the 'financial rot' in Joburg.
'The DA has sent letters to the National Treasury, outlining that those heading up key departments were not doing their jobs, and warning of a total lack of consequence management in Joburg.
'Leaving the ANC in Joburg to do as they please will now come back to bite residents. We are pleased, however, to see that the minister of finance agreed with the DA's summation of what's been going on,' she said.
She also warned that the city is 'barrelling towards collapse under the ANC, faster than ever before'.
'The ANC has proven, time and again, that it cannot govern Johannesburg responsibly.
'The city's finances are in freefall, service delivery is grinding to a halt, and now the very funding that keeps Johannesburg afloat is under threat.'
Auditor-General flags long-standing issues
Earlier this year, the Auditor-General raised red flags over Johannesburg's ongoing failure to improve its audit processes.
The official from the Auditor-General's Gauteng office revealed in Parliament that the city has faced long-standing issues related to financial health, including poor debt collection, declining revenue, and recurring compliance problems.
In addition, the Auditor-General expressed concern over inadequate investment in infrastructure, pointing out that the lack of funding for both maintenance and new projects has had a negative impact on service delivery.
City of Joburg's 'bomb squad'
Morero in June appointed a special 'bomb squad' team to address the city's ongoing service delivery issues.
The 12-member team, led by ANC veteran Snuki Zikalala, will serve for the next two years.
The unit's objectives include deployig rapid response teams to areas experiencing service delivery crises and provide oversight for the mayor.
NOW READ: Morero's vision to make Johannesburg a world-class African city
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