National Treasury has confirmed it will release the remaining R7.1 billion in municipal equitable share funding that was previously withheld from financially distressed municipalities.
The funding forms part of the July equitable share allocation that was initially withheld from 69 municipalities due to serious financial management shortcomings.
These included unpaid debts owed to Eskom and water boards, unfunded budgets, as well as irregular, fruitless and wasteful expenditure.
R7.1 Billion Municipal Equitable Share To Be Released
Finance Minister Enoch Godongwana said the decision to release the funds was taken to ensure communities do not experience interruptions to essential municipal services, despite many municipalities still failing to meet financial management requirements.
The equitable share is a key source of revenue that municipalities rely on to provide essential services, particularly to low-income households.
Government Balances Service Delivery And Financial Accountability
Explaining the decision, Godongwana said National Treasury has to strike a balance between enforcing financial discipline and ensuring residents are not adversely affected by municipal failures.
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“The equitable share is an important source of funding for basic services, particularly services provided for poor households.
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“National Treasury must therefore balance its constitutional responsibility and enforce financial management requirements with the need to avoid communities carrying the immediate consequences of failure by municipalities.”
