Mashaba urges Treasury to tighten grip on Johannesburg funds as financial crisis deepens

Herman Mashaba, leader of the ActionSA party and a mayoral candidate in Johannesburg, has called on the National Treasury to increase oversight of the city’s finances amid a deepening financial crisis. In a letter to Finance Minister Enoch Godongwana, Mashaba urged the department to deploy a technical support team to monitor how funds allocated to the City of Johannesburg are being managed and spent. He emphasized the need for stricter controls, particularly given the city’s dwindling cash reserves and its reliance on reinstating a large portion of its equitable share allocation. The city currently holds just nine days of cash reserves, according to Mashaba, placing it in a precarious financial position. To alleviate this strain, Johannesburg depends on the resumption of its R3.6 billion equitable share allocation, which was suspended by National Treasury on July 7, 2026. The suspension came after repeated failures by the city to uphold fiscal discipline and due to increasing instances of unauthorized, irregular, and wasteful spending. This move follows a prior warning issued by Godongwana regarding Johannesburg’s R10 billion wage agreement with labor unions. The minister deemed the agreement unlawful, arguing that the city could not afford such commitments. The dispute highlights broader tensions between local authorities and national policymakers over budgetary control and financial responsibility. Mashaba warned that the city’s financial instability threatens essential services, infrastructure projects, and investor confidence. He described the situation as one where Johannesburg has “reached its tether,” with millions of residents suffering from a government perceived as failing to protect their interests. The mayor, Dada Morero, and the city’s leadership have been accused of not meeting the governance and financial management standards outlined in the Municipal Finance Management Act. In his letter, Mashaba clarified that his call for increased oversight was not driven by political motives or aimed at undermining the constitutional authority of either the National Treasury or the city’s administration. Instead, he framed his request as a necessary step to ensure that residents receive leaders committed to lawful financial practices and the sustainable growth of Johannesburg, which he describes as Africa’s economic mecca. The situation underscores the growing complexity of managing municipal finances in South Africa, where local governments often struggle to balance competing demands while adhering to strict fiscal guidelines set by national authorities. The City of Johannesburg, as the country’s largest urban center, faces heightened scrutiny not only for its economic challenges but also for its role in shaping national policy and attracting investment. The outcome of Mashaba’s appeal will depend on how quickly National Treasury responds and whether it agrees to the proposed measures. If implemented, the technical support team could provide greater transparency and accountability in the city’s financial operations. However, the process may also lead to further delays in accessing critical funding, exacerbating the current crisis. As the city continues to navigate these challenges, the effectiveness of its leadership and the responsiveness of national institutions will remain key factors in determining its future stability.