Embattled Johannesburg mayor Dada Morero. File photo: X
Johannesburg mayor Dada Morero is under growing pressure to fix the city’s finances and stabilise political leadership, as the treasury threatens to freeze critical funding over billions in irregular expenditure.
Finance Minister Enoch Godongwana has given Morero until mid-August to account for R24.4 billion in unauthorised, irregular, fruitless and wasteful spending. A letter dated 30 July accused the City of Johannesburg of taking “little to no action” on financial mismanagement and warned that a failure to submit a credible recovery plan would result in cuts to national grants.
The city’s budget depends heavily on these transfers, which make up roughly R13 billion, or 15%, of its total R89 billion budget. These funds are used to support basic services and indigent households. Officials warn that Johannesburg’s already limited capacity to deliver services could collapse if the funds are withheld.
Godongwana’s intervention has also reignited concerns about who is really running the city, which critics say is starting to resemble a municipality under soft administration, with key decisions influenced by unelected actors.
Former mayor Kabelo Gwamanda has also weighed in, questioning whether Johannesburg is being managed by its elected officials or rather by external advisers, including the presidential task team and a group dubbed the “bomb squad” appointed by Morero in June to advise on service delivery — whose role and impact however remains unclear.
Auditor general Tsakani Maluleke has flagged eight material irregularities in Johannesburg’s financial management, citing a persistent lack of consequence management. The treasury has warned that failure to submit a credible recovery plan could trigger deeper political and administrative instability.
Earlier this year, Maluke warned that the metro’s financial health threatened its ability to deliver services successfully in the future after it received an unqualified audit with findings.
Morero, who took over the finance portfolio temporarily after Margaret Arnolds was elected council speaker last month, gave the position to former deputy regional secretary Loyiso Masuku on Thursday. Incidentally, Morero and Masuku are expected to go head-to-head for the position of ANC Johannesburg regional chairperson before the end of the year.
Smaller parties such as Al Jama-ah, the United Democratic Movement and the African Independent Congress that form part of Johannesburg’s government of local unity had demanded that the position be given to former mayor Thapelo Amad or else they would withdraw their support for the ANC. Amad briefly served as mayor in 2023 but resigned ahead of a motion of no confidence.
The parties argued that this was part of the coalition agreement made when the ANC was handed the mayoralty. According to the agreement, if the ANC took the mayor position, the finance portfolio would go to one of the smaller coalition partners.
Gwamanda said the ANC needed to honour its commitments and treat its partners with respect. He warned that if Amad was not appointed, it would be viewed as a betrayal of the coalition agreement and could prompt parties to reconsider their support for Morero.
“The minority parties voted for the ANC’s Morero because of political pressure and a misguided framework on coalition government,” read a letter from Gwamanda to Morero’s office dated 5 August.
ANC regional coordinator Sasabona Manganye confirmed the tension, saying the original deal with the minority parties was that they would get two MMC posts in exchange for their votes.
But arrangement changed when Arnolds of the African Independent Congress, a minority party, was made speaker, Manganye added. He said the speaker role is more influential and that the coalition agreement had therefore effectively been met, and also questioned the loyalty of some minority partners, pointing to allegations that Al Jama-ah had been in discussions with opposition parties.
Despite the small parties’ threats to withdraw their support, Morero chose Masuku to run the most powerful position in the metro — keeping the power within the ANC.
The Mail & Guardian understands that Morero had held on to the finance MCC position, hoping to give to one of his political supporters who would help in his fight to retain power in the upcoming ANC regional conference.
“Morero had been trying to delay the decision [before the pressure from treasury to maintain control over the portfolio while navigating internal and external pressures,” one source said.
The Democratic Alliance, which is the largest opposition party in council, said the letter from the treasury confirmed concerns it has raised for some time.
DA caucus leader Belinda Kayser-Echeozonjoku said in a statement that conditional grants must be used strictly for their intended purpose and that treasury’s action was justified. She warned that if the grants are suspended, the city’s ability to deliver even the most basic services will be compromised.
“The minister’s letter is no empty threat. Johannesburg’s R89 billion budget is funded through a mix of grants, loans, revenue collection and conditional grants. Conditional grants, which form a significant portion of the city’s funding, can only be spent on what they are intended for,” Kayser-Echeozonjoku said.
“If the treasury pulls back or suspends these funds, as the minister warns in his letter, the city’s ability to deliver the little basic services it is currently able to deliver, will collapse entirely.”
Several insiders said the treasury’s letter had created a sense of urgency that is politically impossible to ignore.
The deadline for the recovery plan falls before Johannesburg hosts the G20 summit of heads of state later this year. President Cyril Ramaphosa, who visited the city in March, publicly criticised its condition as dismal, with poor service delivery across the board and many roads full of potholes.
Morero’s office had not responded to questions from the M&G at the time of publishing.