7 May 2026
Finance Minister Enoch Godongwana has raised concerns about the “deterioration in the [City of Johannesburg’s] governance and overall financial health”. Photo: Seth Thorne
Civil society organisation JoburgCAN has welcomed a scathing letter from Minister of Finance Enoch Godongwana to Johannesburg Mayor Dada Morero, outlining his concerns with the metro’s finances.
The letter, dated 23 April, threatens to withhold the metro’s next tranche of the equitable share grant because of the “deterioration in the City’s governance and overall financial health”.
“This letter confirms what [we have] consistently said: Johannesburg is budgeting on hope, not cash,” said Julia Fish, managing director of JoburgCAN.
“The City’s budgets and adjustment budgets have repeatedly been built on revenue targets it is not able to meet,” said Fish. “Instead of using realistic collection data, the City keeps presenting residents with numbers it says it is working towards achieving. That is not sound budgeting, and it has left Johannesburg with a major cash-flow crisis.”
But Fish warned that withholding the grant would harm vulnerable residents. Fish suggested alternatives, including a recovery plan, administration, accountability for leadership, spending reviews, a wage freeze for senior staff, and protection of funds meant for poor people.
At the heart of Godongwana’s concern is that the 2025/26 adjustment budget, approved by council on 20 March, is unfunded.
CoJ’s revenue collection is failing to meet budgeted targets, the minister said, and expenditure has been understated. This will likely result in unauthorised expenditure.
Godongwana noted a R3.9-billion over-expenditure on employee-related costs and bulk services as of January 2026.
While the National Treasury sets a 95% revenue collection target, Johannesburg consistently falls short. Only about half of its water supply generates revenue, due partly to infrastructure failures, and nearly 30% of the electricity it purchases from Eskom is lost.
The City’s debt to creditors has surged from R17-billion in 2022/23 to R25.2-billion in 2024/25, Godongwana said. Its cash of R3.9-billion is insufficient to cover these growing obligations.
The letter also details several violations of the Municipal Finance Management Act. This includes the metro’s inability to transact or report fully through a compliant financial system, which has compromised data integrity and limited its ability to generate accurate financial statements.
In March, the Johannesburg Stock Exchange suspended trading of Johannesburg’s bonds because the metro failed to release audited financial statements for the year ended June 2025.
Godongwana directed the City to stop implementing an “illegally signed” R10.3-billion salary-increase agreement reached with the South African Municipal Workers Union (SAMWU) in November 2025, which “is not possible to fulfil”.
The wage agreement has the “potential to destroy the sustainability of the City of Johannesburg”, which will have a “negative impact on the national economy at large”, wrote Godongwana.
In a statement, Morero insisted that the municipality continues to exercise effective oversight and control over its financial responsibilities, saying that there is currently “no cause for concern”.
Morero said officials would be meeting with the finance ministry.
