The National Treasury reinstated R3.6 billion in equitable share funding to the City of Johannesburg on 21 July 2026 after the city addressed governance concerns and committed to improved financial management following earlier non-compliance with the Municipal Finance Management Act (MFMA), according to official statements.

City Complies With Treasury Demands And Commits To Settling Debts

The reinstatement followed the Treasury’s decision to withhold a total of R13.5 billion from 69 municipalities, including R3.6 billion from Johannesburg, under Section 216(2) of the Constitution and Section 38 of the MFMA. The intervention was aimed at enforcing fiscal discipline and required affected municipalities to address shortcomings in financial governance. Johannesburg Mayor Dada Morero confirmed the city would settle all outstanding debts to Eskom and Rand Water by mid-July 2026.

“On our side, we will fully comply with the process,” Morero stated during a media appearance, underlining Johannesburg’s cooperation with national requirements for restoring funding. The Mayor added that the city was already in discussions to appoint transaction advisers and act swiftly to realign finances.

Treasury Intervention Highlights Financial Governance Challenges For Municipalities

The National Treasury’s intervention in July 2026 was prompted by widespread non-compliance across dozens of South African municipalities, reflecting ongoing challenges in local government financial stewardship. Treasury officials confirmed the withholding of funds was temporary and did not anticipate a major impact on essential public services. “The withholding of the funds will be for a short-term period, the National Treasury does not foresee any impact on service delivery,” Treasury said in an official communication.

This episode underscores the importance placed by national authorities on strict adherence to the MFMA and the effectiveness of direct financial measures to enforce compliance. The City of Johannesburg’s rapid response and the reinstatement of funding serve as a precedent for other municipalities under scrutiny to address financial risks and maintain critical budget flows.