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Godongwana warns he will again withhold funds from municipalities

Published

Finance Minister Enoch Godongwana told Parliament that municipalities which misuse public money or break their commitments could lose funding again. He said national and provincial departments that owe municipalities at least R27.6bn will be held to account.

Godongwana spoke in his medium-term budget policy statement speech on Wednesday. He said the step taken in June had changed the behaviour of municipalities that used the equitable share for unintended purposes. In June, the government suspended July equitable share transfers to 69 municipalities over continued mismanagement of public funds.

Godongwana said 38 municipalities concluded council-approved repayment plans with creditors. Their payments to creditors reached R4.2bn by 31 July. He said the government required these municipalities to negotiate payment plans and enforce consequence management for irregular, fruitless and wasteful expenditure.

Treasury is also clamping down on departments and public entities that owe municipalities money. Godongwana said municipalities that contract Eskom to manage, maintain and bill for electricity distribution safeguard their revenue. New municipal administrations are elected on 4 November.

Key facts

Who
Enoch Godongwana (Finance Minister); Treasury (National Treasury, clamping down on departments and public entities owing…); South African Revenue Service (creditor of municipalities); Eskom (utility that municipalities would be required to contract for electricity…)
What
Godongwana told Parliament in the MTBPS speech that municipalities which misuse funds could again lose funding, and that national and provincial departments owing municipalities at least R27.6bn will be held to account. He also said 38 municipalities concluded council-approved repayment plans, with payments to creditors reaching R4.2bn by July 31.
When
21 October 2026
Where
South Africa
Status
Reported

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