Auditor-General Tsakani Maluleke.
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The Auditor-General’s report emphasises persistent governance issues in metros, as none achieve a clean audit. Although metros account for 54% of local government expenses and serve millions, Joburg is specifically noted as requiring continuous oversight from both authorities and the executive.
Auditor-General Tsakani Maluleke warned that Gauteng's municipalities face declines in audits, financial stability, and services.
The Organisation Undoing Tax Abuse (OUTA) states the 2024/25 local government audit shows South Africa’s municipal crisis remains deep-rooted, despite slight improvements in some indicators.
“Residents are paying more every year for rates, taxes, electricity, water, sanitation, and refuse collection, yet many continue to face failing infrastructure, sewage spills, water losses, potholes, electricity outages, and declining municipal services,” said Julius Kleynhans, Executive Manager at OUTA.
“The people are tired of paying for failure. Only 39 municipalities achieved clean audits. That is just 15% of local government. Anything short of a clean audit, including an unqualified audit with findings, points to weaknesses in governance, compliance, financial management, or performance reporting.”
Maluleke has reported that the City of Johannesburg received a qualified audit opinion this year, a decline from its previous unqualified status. She emphasized that the city requires urgent attention from both executive and oversight bodies to address its institutional arrangements.
Additionally, following MPAC recommendations, the city has written off approximately R918 million in historical irregular and unauthorized expenditure—specifically R877 million and R41 million respectively—due to missing supporting documentation.
On Wednesday, the council approved the writing off of the amount. ActionSA councillor Phiwokuhle Xulu said the party supported the move but did not celebrate the regularisation of irregular and unauthorised expenditure.
He said the Municipal Finance Management Act (MFMA) requires council to deal decisively with these matters after a thorough investigation by MPAC.
“This report (tabled before council) is the culmination of investigations into 42 reports with recommendations dealing with over R876m in historical irregular expenditure and more than R41m in unauthorised expenditure,” Xulu explained.
He said these were not insignificant amounts and reminded councillors of the devastating costs of weak governance and poor financial discipline.
“The reports also make it clear that in many of these historical matters supporting documentation could not be found, forcing the committee to rely on sworn statements after guidance from the National Treasury. That is an indictment of past administrations,” said Xulu, adding that regularising expenditure did not mean excusing wrongdoing.
He said ActionSA has always been clear that every rand of public money must be accounted for, consequence management must be implemented and where there is evidence of misconduct or criminality those responsible must face disciplinary and criminal processes.
“This current administration will leave office having allowed hollowed-out governance, weakened internal controls, and normalised irregular expenditure. When ActionSA returns to government under the leadership of Herman Mashaba, we are going to rebuild a capable administration founded on clean governance, professional public service, and zero tolerance for corruption,” added Xulu.
DA councillor Julie Suddaby told the council that the writing off of the irregular and unauthorised expenditure comes just days before the deadline set by the National Treasury for the City of Johannesburg to reduce its unauthorised, irregular, fruitless and wasteful expenditure (UIFW) by 86% by next Tuesday, June 30, or otherwise the July 2026 equitable share tranche will be at risk.
She said Treasury set a similar deadline for a document retention policy to be in place by next week; otherwise, the equitable share tranche will be at risk.
Suddaby described the writing off as gross and indicated that the DA opposed it.
She said the almost R877m in irregular expenditure was for the 2010/11 to 2015/16 financial years and that it included R8.73 for 2010/11 to 2015/16. According to Suddaby, the balance comes from years 2022 to 2026.
Suddaby continued: “The request to regularise, condone, and write off the ten to 16-year-old identified by the Auditor-General comes from the inability of the investigators to access the supporting documentation required to determine the recoverability of the irregular expenditure”.
She said that, according to the relevant department heads and executive directors, the minutes of all procurement committees and related records cannot be located. This includes awarded contracts, service-level agreements, digital and physical communications, proof of delivery, invoices, and payment records.
“The only indication that money was spent and that it was irregular is the Auditor-General’s notification of the UIFW register for group forensic investigations,” said Suddaby.
She said this was just one example highlighting the city’s dysfunction in protecting documents.
ANC ward 33 councillor Nompumelelo Mazibuko said the MPAC received guidance from the National Treasury during a workshop, as the supporting documents could not be located despite reasonable efforts by management.
“The National Treasury advised in such instances the relevant accounting officers and finance executives should be disposed to sworn affidavits confirming that all reasonable steps have been taken to locate the missing records,” she said.
Mazibuko said the committee noted that the Treasury guidelines do not absolve the city of its responsibility to maintain proper records and ensure compliance with the MFMA but rather provide a mechanism for dealing with exceptional, historical cases where records can no longer be retrieved despite efforts.
EFF councillor Johannes Mosethla said the party also supported writing off.
“However, this is not blind support, but it’s accompanied by a firm demand for accountability, consequence management, and decisive action against corruption and financial misconduct,” he said.
Mosethla added that the figures contained in the report were alarming and should concern every councillor who genuinely care about the future of the City of Johannesburg.