National Treasury has withheld R13.5 billion in equitable share transfers from 69 municipalities across South Africa, including Musina, Thabazimbi, Fetakgomo/Tubatse, and Mopani in Limpopo province, citing ongoing financial mismanagement and governance failures by local authorities.

Limpopo Municipalities Under Scrutiny For Persistent Financial Failures

The Democratic Alliance in Limpopo publicly criticised the ANC for what it described as the party’s entrenched poor leadership and governance in the province’s municipalities. Speaking after the Treasury decision, DA Limpopo chairperson Lindy Wilson said, “It is clear that the mandatory municipal Section 71 reports by the accounting officer and the quarterly Section 52(d) reports by mayors to set out the state of financial affairs of their municipalities, and which further act as an early warning system, is not worth the paper it is written on, either because of a lack of transparency on municipal balance sheets, or the lack of scrutiny by Makamu’s department, or both.”

The Special Investigating Unit (SIU) has previously reported procurement irregularities, poor record-keeping, and inadequate risk management in Limpopo municipalities. According to the SIU and local investigative media, Limpopo has faced recurring challenges related to financial mismanagement, with repeated allegations of wasteful expenditure and contract irregularities.

Governance Problems Linked To ANC Provincial Leadership History

The withholding of funds is the latest in a series of interventions prompted by governance failures. In 2013, the ANC dissolved its Limpopo provincial leadership following findings of factionalism and breakdowns in governance. The party also recalled the mayor of Thulamela Local Municipality in 2021 after the VBS Mutual Bank scandal, underscoring long-standing concerns about accountability.

Explaining the latest Treasury decision, a National Treasury official said, “Funds are withheld under section 216 of the Constitution when municipalities fail to comply with financial management rules. National Treasury does not punish communities, it responds to failed governance.” Official correspondence confirms that the decision affects core service delivery in several districts, raising concerns amongst residents and civil society organisations in Limpopo.

Limpopo municipalities now face urgent pressure to resolve outstanding issues with transparency and governance or risk further financial isolation from the National Treasury. The status of the withheld funds will depend on the affected municipalities’ compliance progress in the coming months.