JOHANNESBURG — The National Treasury has announced the resumption of the release of the remaining withheld municipal funding, totaling R13. 5 billion, from the end of July. This decision comes after the ongoing monitoring of 69 municipalities, whose funds were temporarily withheld due to concerns over compliance with municipal finance laws.
Last week, the Treasury confirmed that it had lifted the freeze for 42 of the 69 municipalities, with 10 having already received their full allocations, amounting to R1. 7 billion.
The release of the funds does not signify that the municipalities have fully addressed their financial issues. They are still required to comply with the requirements of the Municipal Finance Management Act (MFMA).
The Treasury’s intervention is in response to the growing issue of unauthorised, irregular, fruitless, and wasteful expenditure (UIFWE) in South African municipalities, which has reached R287. 46 billion since 2021/22. While critics argue that the withholding of funds has caused undue hardship for municipalities and their residents, proponents assert that it is necessary to ensure responsible management of public money and prompt addressing of financial mismanagement.
The phased resumption of funding will see the remaining municipalities continue to undergo monitoring, with the National Treasury working closely with local governments to implement corrective measures.
The Treasury has outlined the next steps, including requiring municipalities to pay off debts to creditors such as Eskom and water boards, in line with signed repayment agreements.
The resumption of funding for 42 municipalities is seen as a positive development but also underscores the ongoing challenges faced by South African local governments in managing their finances effectively.
As the process continues, the focus will be on whether these measures will lead to sustainable improvements in financial management and accountability.
The long — term impact of these interventions on South African municipalities remains unclear.
*Additional reporting by ImNews | Sources consulted: 5*
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This original article was produced by the ImNews editorial team
Source: enca
Source: Nokuthula Khanyile
