Treasury withholds July funds from 69 municipalities

The National Treasury has temporarily withheld a portion of July 2026 funding allocations to 69 municipalities across South Africa, citing persistent failures in financial management and compliance with the law. The decision, announced on Tuesday, July 7, 2026, affects municipalities in all nine provinces, including major metros such as Johannesburg, Nelson Mandela Bay, and Mangaung.

Finance Minister Enoch Godongwana confirmed the move, stating it was taken under constitutional provisions to instill fiscal discipline. The Treasury said the action is a corrective measure following months of engagement and written warnings to the municipalities, which were given an opportunity to explain why their equitable share transfers should not be withheld.

Officials said the affected municipalities have consistently failed to address serious governance issues, including the adoption of unfunded budgets, mounting unauthorized, irregular, fruitless, and wasteful expenditure, and a lack of accountability for financial misconduct. The Treasury stressed that non-compliance threatens the financial sustainability of bulk suppliers like Eskom and water boards, to which municipalities owe billions...