By In an urgent bid to rescue Gauteng’s crumbling local government finances, Provincial Member of the Executive Council (MEC) for Finance, Honourable Nkululeko Dunga, convened the inaugural Finance Political Intergovernmental Relations (IGR) Forum.
The high-stakes meeting brought together Members of the Mayoral Committees (MMCs) responsible for Finance, Municipal Managers, Chief Financial Officers (CFOs), and senior provincial treasury officials to confront a mounting fiscal disaster across the province.
The gathering laid bare the severe operational paralysis and debt burdens overwhelming Gauteng’s municipalities. Local finance leaders presented a grim catalogue of systemic pressures driving their municipalities toward insolvency.
Chief among their concerns were the crippling financial strains imposed by unfunded mandates, spiralling infrastructure backlogs, and persistent capacity shortages within local administrations.
Municipalities also flagged intense financial friction caused by ongoing Eskom debt pressures and questioned the current 80/20 vehicle licensing revenue-allocation model, which local leaders argue unfairly deprives municipal coffers of much-needed revenue. Adding to the fiscal nightmare is inter-provincial debt; representatives highlighted substantial unpaid bills, including significant outstanding provincial debt owed to local councils and cross-border obligations owed by the North West Provincial Government to the City of Tshwane.
Acknowledging the severity of the crisis, MEC Dunga warned that the forum would not serve as another talking shop, insisting that the priority must shift entirely to rapid, measurable execution.
“The focus will be on implementation rather than discussion alone, with agreed actions and timelines for continuous follow-up,” Dunga asserted, promising strict consequence management and tighter intergovernmental oversight.
To turn the tide, the Gauteng Provincial Treasury committed to a swift, multi-pronged action plan:
- Unfunded Mandates: Treasury will calculate and quantify the true cost of unfunded mandates forced onto municipalities within one month to establish clear financial relief mechanisms.
- Infrastructure Backlog Audit: A digitised provincial assessment of infrastructure backlogs will be completed within three months to target interventions and allocate capital effectively.
- Inter-Provincial Debt Recovery: Treasury will formally intervene with the North West Provincial Government to recover unpaid debts owed to the City of Tshwane.
- Licensing Revenue Reform: Executive engagements will begin with the Department of Roads and Transport to re-evaluate the disputed 80/20 vehicle licensing funding formula.
- Smart Metering and Eskom Support: The province will directly assist struggling municipalities with grant applications for smart metering technology to curb electricity losses and mitigate bulk power debt.
- Governance Oversight: Treasury will deepen its operational collaboration with the Department of Cooperative Governance and Traditional Affairs (COGTA) to enforce stricter financial management practices.
While province-wide coordination will continue through the newly formed IGR Forum, Dunga confirmed that Provincial Treasury will simultaneously run bilateral, municipality-specific interventions to address localized balance-sheet failures.
With public service delivery deteriorating and municipal balance sheets under unprecedented strain, all eyes now turn to whether Dunga’s tight timelines and firm commitments can translate into financial stability for South Africa’s economic hub
