PRETORIA, Gauteng — Lawmakers have thrown their full support behind the National Treasury’s decision to withhold the 2026 equitable share funding for 69 municipalities, demanding that local authorities urgently rectify severe administrative and financial mismanagement. During a virtual briefing hosted by the governance cluster oversight committees of Parliament, legislative leaders emphasized that the funding freeze is a necessary intervention to force compliance and protect basic service delivery.
Dr. Zweli Mkhize, who chairs the Cooperative Governance and Traditional Affairs Portfolio Committee, expressed strong approval of the Treasury’s intervention but stressed that the affected municipalities must urgently align with national laws. He noted that while the equitable share is the financial lifeblood that enables communities to receive essential services, the continued governance failures leave the state with no choice.
Mkhize urged the 69 local councils to meet the required conditions expeditiously so the financial restrictions can be lifted, preventing further hardship for residents. The National Treasury has maintained that the intervention is carefully structured to avoid disrupting daily municipal operations, as these specific councils have been flagged for chronic issues over an extended period.
According to Mkhize, the current crisis mirrors long-standing audit findings and oversight reports. He detailed a litany of systemic failures prompting the freeze, including unfunded budgets, compromised internal controls, procurement irregularities, poor revenue collection, massive water and electricity losses, irregular expenditure, and a glaring lack of consequences for proven misconduct.
Push for Rigorous Public Sector Lifestyle Audits
The parliamentary oversight extended beyond local government to scrutinize the broader public service, specifically the execution of lifestyle audits for state employees. Jan de Villiers, Chairperson of the Public Service and Administration (PSA) committee, highlighted a pressing need to fast-track these audits, noting that current implementation is highly inconsistent across the country.
De Villiers pointed out that regions like the Western Cape, the Northern Cape, and specific departments in KwaZulu-Natal are leading the way by leveraging the Special Investigating Unit (SIU) for robust assessments. In contrast, other jurisdictions rely heavily on internal ethics officers, which merely produces superficial “lifestyle reviews” instead of thorough, comprehensive audits. He stressed that lawmakers recognize a critical distinction between basic financial disclosure and a true lifestyle audit.
R800 Million Drain from Disciplinary Backlogs
Furthermore, the PSA committee tackled the massive financial drain caused by unresolved disciplinary matters within the public service. Citing recent reports, de Villiers revealed that over 670 public servants remain suspended with full pay, draining the national budget by roughly R800 million annually.
He described the situation as a severe fiscal burden that diverts crucial resources away from essential service delivery and places immense pressure on an already stretched national budget. The committee is now pressing for immediate measures to clear the massive disciplinary backlog and drastically cut down on paid suspensions to relieve the fiscus.
Looking ahead, Finance Minister Enoch Godongwana is scheduled to hold a media briefing on Friday. He is expected to provide further details on the Treasury’s withholding of the municipal equitable share and outline the next steps for the affected councils.