Godongwana threatens to suspend funding to failing municipalities again
By the AFREEQUE newsroom, based on Sowetan
South African Finance Minister Enoch Godongwana warns the Treasury could again suspend transfers to municipalities that misuse public funds or fail to meet their commitments. After payments to 69 municipalities were suspended in June, 38 had agreed repayment plans and paid creditors 4.2 billion rand by 31 July, Godongwana said.
South African Finance Minister Enoch Godongwana has warned that transfers to municipalities that misuse public funds or fail to meet their commitments could be suspended again, according to the Sowetan. He made the warning on Wednesday, 21 October, while presenting the medium-term budget policy statement to Parliament.
In June, the Treasury suspended July transfers to 69 municipalities under their equitable share of national revenue. Godongwana said the measure had led to a change in behaviour. Thirty-eight municipalities had entered into repayment plans approved by their councils, and payments to creditors had reached 4.2 billion rand by 31 July.
The failures included non-payment of bulk electricity and water suppliers, the South African Revenue Service, the Auditor-General and pension fund contributions. The minister also said national and provincial administrations, as well as other public entities, owe municipalities at least 27.6 billion rand. In the medium term, grants may be withheld or reallocated if conditions are not met.
The warning elaborates on the budget response outlined by Godongwana on 20 October, when he said he would address concerns over municipal funding in his South African budget.
Summary produced with the help of artificial intelligence tools, under AFREEQUE’s editorial responsibility.
