Johannesburg’s Financial Struggles Persist as ESKOM Debt and Funding Threats Mount

Mayor Dada Morero has acknowledged that the City of Johannesburg was already confronting serious financial strain when he assumed office, compounded by a controversial wage agreement with the South African Municipal Workers’ Union. The remarks come amid warnings from Finance Minister Enoch Godongwana that the National Treasury may withhold funding, as the metro cannot afford the proposed salary increases.

In his recent State of the City address, Mayor Morero asserted the city’s financial stability despite owing more than R5 billion to ESKOM and facing other fiscal pressures. University of the Free State local government expert Dr Harlan Cloete offered a cautious assessment of the address and the city’s outlook.

“A speech is a speech. It is words. It’s how people experience the city tomorrow morning and the day after tomorrow that really matters,” Dr Cloete said. He highlighted residents’ lived experiences as the true measure of hope, noting ongoing concerns over the city’s mounting debt to ESKOM.

ESKOM has indicated it may reduce electricity supply to the city due to unpaid bills, despite some residents continuing to pay their accounts. Dr Cloete described this as a “huge concern,” expressing hope that political leadership would reach an agreement to prevent power cuts. He stressed the need for a sustainable plan to settle the debt, observing that Johannesburg is not alone—many South African municipalities owe billions to the power utility.

“Johannesburg is the economic hub of South Africa and we can ill afford for ESKOM to pull the plug,” Dr Cloete said, adding that he is confident a solution will be found through engagement with the Minister of Electricity.

Dr Cloete described the mayor’s address as a strong report card on the performance of the governing coalition and an effective election speech. Morero devoted time to comparing Johannesburg’s gains with those of Cape Town. With local government elections scheduled for 4 November and no party expected to secure an outright majority, the speech appears aimed at persuading voters to renew the coalition’s mandate.

Residents, however, will judge progress by tangible improvements in service delivery. “All people want to be safe. They want to make sure that the streets are clean… and that there’s economic opportunities,” Dr Cloete noted. He emphasised that local government should act as an enabler for economic development amid high poverty levels.

The expert pointed to a massive infrastructure backlog estimated at around R220 billion, worsened by rapid urbanisation, poor contract management, and inadequate long-term planning. On efforts to electrify informal settlements and integrate these communities into service delivery, Dr Cloete highlighted the dignity issues involved, illegal connections, and the broader challenge of addressing South Africa’s extreme inequality.

“Poor people in this country are playing catch-up,” he said, underscoring the need to prevent marginalised communities from being left behind. While education falls outside local government’s direct mandate, Dr Cloete argued municipalities have a role in collaborating with other spheres of government.

He advocated for evidence-based policymaking, professionalising the bureaucracy, appointing competent officials, and ensuring political stability. Research and the Auditor-General’s findings show that political stability correlates strongly with better service delivery, he added.

Dr Cloete concluded that while the mayor’s speech outlined promises and achievements, including action against illegal structures in the CBD, ultimate success depends on how citizens experience governance on a daily basis.

 

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