KUGOMPO CITY, Eastern Cape — The stabilization of Eastern Cape municipal finances is facing significant roadblocks due to coalition infighting, Premier Oscar Mabuyane revealed, following the National Treasury’s decision to withhold the July 2026 equitable share. Speaking at a provincial local government accountability session in KuGompo City, Mabuyane highlighted that political friction and persistent non-compliance with the Municipal Finance Management Act (MFMA) are directly impeding the province’s ability to correct systemic fiscal mismanagement.
Provincial leadership stressed that losing access to these critical equitable share allocations could have a devastating impact on local residents unless proactive interventions are rapidly implemented. A key issue identified during the session was the historical failure to enforce consequence management for financial transgressors. However, corrective measures are reportedly gaining traction, with disciplinary proceedings already launched against 100 municipal employees within just one of the six affected local governments in the province.
Premier Mabuyane emphasized that political indiscipline directly disrupts the core functions of municipal councils. He questioned whether local authorities are adhering to strict deadlines, convening scheduled meetings promptly, and empowering functional municipal public accounts committees. Strengthening these oversight structures, he argued, is non-negotiable for ensuring comprehensive accountability and resolving the province’s governance challenges.
Although the provincial government supports the National Treasury’s strict enforcement of financial regulations, officials caution that extended funding freezes will trigger acute operational crises. Eastern Cape CoGTA MEC Zolile Williams pointed out that local governments rely heavily on self-generated revenue, which is currently crippled by massive outstanding debts owed by residents, private businesses, and other government departments to these same six municipalities.
Williams specifically warned that the Makana Local Municipality, alongside the other five affected areas, will inevitably confront severe cash flow constraints without the national fiscal equitable share. This financial bottleneck threatens to further aggravate the daily service delivery backlogs the province is already battling to resolve.
On a positive note, the provincial government confirmed that the Buffalo City Metro and Port St. John’s municipalities have successfully submitted their corrective action plans to the National Treasury. Having met all compliance requirements, these two municipalities are slated to have their suspended allocations reinstated shortly, setting a vital precedent for the remaining affected councils to follow.