The City of Johannesburg is “technically bankrupt” and lacks any viable financial solution, according to Wayne Duvenhage, CEO of the Organisation Undoing Tax Abuse (OUTA), who warned that the economic hub of South Africa has spiraled far beyond the brink of crisis.
Duvenhage’s remarks come after Finance Minister Enoch Godongwana warned Mayor Dada Morero that national funding to Johannesburg will be cut off from July unless the city scraps a R10.3 billion wage deal with municipal workers—a three-year pact signed in April with the South African Municipal Workers’ Union (SAMWU) that Godongwana has labelled both illegal and unaffordable.
The city is already carrying R25.2 billion in debt and holds only R3.9 billion in reserves. Duvenhage noted that the Johannesburg Stock Exchange (JSE) has already blocked the city’s fundraising efforts from finance houses. “When you cannot borrow, you’re in a bigger bind and a bigger pickle,” he said.
Duvenhage said the Gauteng provincial government should have placed the city under administration two years ago, as it has done in Emfuleni and other areas. “This is where politics gets in the way,” he said. “These close relationships with the political players prevent this from happening.”
He was highly critical of Mayor Morero’s leadership, responding to a recent interview in which Morero downplayed service delivery failures—suggesting that residents without daytime water could simply access it at night. “He has failed completely,” Duvenhage said. “When you’re an executive mayor and you see the deterioration… he’s walking around the city with his eyes closed. The potholes are getting bigger. There are more and more of them. Traffic lights don’t work.”
Duvenhage rated Morero’s performance as “minus 10 out of 10” and said he should be removed from office immediately. “He is totally blinkered and he needs to go sooner rather than later. I don’t even know if we can wait till the November elections.”
On the wage agreement, Duvenhage acknowledged that overturning the deal would likely require court intervention. While SAMWU has insisted the agreement is binding and cannot be illegal, Duvenhage argued the city was “out of line” in entering into commitments under a potentially unfunded budget.
Asked whether the city’s financial violations amount to criminal misconduct, Duvenhage responded: “If you dig deep enough, if you do the forensic audits, I think you will find sufficient to raise criminal charges against officials in the city… I think you’ll find a lot of inefficient and irregular and possibly criminal money flows.”
He warned that the crisis extends beyond Johannesburg’s borders. “If Joburg goes down, the country goes down. Nobody is safe here. There are too many assets and companies and lives invested in the city.”
Duvenhage called on the finance minister to place the city under administration immediately, conduct forensic investigations, and hold all responsible officials accountable. “They are creating a crisis in this country,” he said.