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Treasury freezes funds for Johannesburg and three other Gauteng councils

Zuko Komisa

National Treasury
Image | @TreasuryRSA/ Twitter
  • Four major Gauteng councils, including the City of Johannesburg, have had their national funding frozen by the National Treasury.
  • The freeze targets severe financial misconduct and non-compliance with the Municipal Finance Management Act to stop wasteful spending.
  • Despite major metros losing their fiscal lifelines, the government claims local service delivery will not be disrupted during the temporary suspension.

Gauteng’s local government finances have suffered a severe blow after the National Treasury temporarily froze funding to four of the province’s prominent councils.

The City of Johannesburg, Emfuleni, Lesedi, and the Sedibeng District Municipality have all been blacklisted alongside 65 other municipalities nationwide.

The drastic intervention follows a damning report from the Auditor-General revealing that only 15% of municipalities across South Africa achieved clean audits.

Before pulling the plug, the Treasury issued formal warnings to the Gauteng councils, allowing them to submit representations to defend their financial management.

Officials emphasise that the intervention is a corrective mechanism rather than a permanent punishment, designed to force accountability and halt unauthorised, irregular, and wasteful expenditure.

While the freeze puts immense pressure on the economic hub’s local leadership, national government insists that residents will not bear the brunt of the fallout. In an official press release, the department stated:

“The decision follows persistent and serious non-compliance with the Municipal Finance Management Act and its supporting regulations… The National Treasury does not foresee any impact on service delivery.”

Funding will remain suspended until the affected Gauteng municipalities can prove they have cleaned up their accounting practices and complied with statutory regulations.

Kaya Biz host Gugulethu Mfuphi spoke to DJ Fresh and Thato on what to make of City of Joburg finances being reviewed by Moodys.

READ NEXT: Johannesburg buried in trash as Pikitup battles R1.3 billion debt and fresh labour protests

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