Joburg is a risk to the country’s fiscus, justifying the drastic step this week by the National Treasury to withhold this month’s equitable share.
The equitable share is an unconditional grant routinely provided by the national government to municipalities — Joburg’s is set at about R8.6bn for financial 2027 — aimed primarily at funding free basic services for poor households. The Treasury has not released its schedule of equitable share payments for this year, but in the last financial year it was paid out in three tranches, with the July payment standing at R3.3bn. To withhold it is a rare and drastic measure.
Yet the politicisation and capture of the city run so deep that there is little that can be done in the short term without deeply upsetting the extraction networks that have been carved into the municipal administration in the past decade and are under the protection of the current political leadership.
Ahead of the G20 summit in Joburg in September last year, a presidential working group was deployed to turn the ailing city around and save South Africa’s blushes in front of the world’s leaders. A couple of months later a “bomb squad” was appointed amid much fanfare to tackle service-delivery challenges; a crack 12-member team of former city managers, governance experts and politicians headed by ANC veteran Snuki Zikalala.
The summit has come and gone and both initiatives have come to naught. The city’s financial situation has deteriorated even further, and the usual flurry of boosts in service delivery ahead of an election has not materialised. The council now seems incapable even of selective window-dressing.
The threat to withhold the equitable share was first made formally by finance minister Enoch Godongwana in a letter in May. The minister asked the city to reverse its R10.3bn wage deal with unions, which he called illegal. He noted Joburg is insolvent — its revenue collection does not match its budgeted targets, and it has overspent by almost R4bn in staff-related costs, bulk electricity purchases and operational costs. The city did nothing.
In a normal world, the Treasury withholding the equitable share would spur a city into action; there would be urgent council meetings and immediate, independent investigations into accounting officers and their conduct. But this is highly unlikely.
The current council, anchored in a coalition between the ANC and the EFF, will not act against its point man in charge of finances, municipal manager Floyd Brink
The reason is the current council, anchored in a coalition between the ANC and the EFF, will not act against its point man in charge of finances, municipal manager Floyd Brink.
Brink — whom the EFF (and the ANC) fought tooth and nail to retain as city manager — has a long history with EFF party boss Julius Malema, as amaBhungane investigations revealed. Brink was arrested in 2013 and tried for tender corruption while he was a manager in the Limpopo roads & transport department. The same investigation implicated Malema and his company On Point Engineering.
Brink was acquitted and made a dramatic comeback in Joburg as COO under Herman Mashaba, the then DA mayor, in 2018. Mashaba quit the DA and founded ActionSA which, in 2022, backed Brink for the post of municipal manager (he also had the backing of the EFF) instead of the DA’s preferred candidate, Johann Mettler, who is now the Tshwane municipal manager.
The question is why the ANC and the EFF regard Brink so highly, if the city has descended into such complete disrepair under his watch — his eight-year tenure is far longer than that of any mayor since Amos Masondo, who ended his second term in 2010.
New South Institute director Ivor Chipkin has conducted a deep dive into Joburg’s administration and what he found is disturbing.
His report, due to be publicly released in the near future, indicates that for the most part, the city’s administration “does not exist”. He found that staff are largely appointed by politicians — the mayor, the mayoral committee and councillors — and not the city manager. Brink is either sitting on his hands or is complicit.
Chipkin says because the appointments are politically motivated and not linked to technical requirements, dysfunction has spread, especially in utilities, with entire teams having no reporting lines or managers to whom they must account.
Chipkin’s research ties in with observations by the team from the Presidency last year, indicating that across metros (the problem is not limited to Joburg, though it is most serious there), staff costs have risen 84% over the past 15 years in real terms. The problem, the FM understands, was not staff costs per se, but the inability of the metros to ensure “performance and basic service delivery”.
In effect, the metros have been repurposed as employment agencies for people who are not performing the tasks for which they were appointed.
Chipkin believes this state of affairs is partly a result of the Municipal Systems Act of 2000, which creates the need for municipal managers to have political protection — though they are supposed to be technocrats acting in the interests of residents and ratepayers, not political parties and their networks.
The ANC this week held interviews for its mayoral candidates in the November local government elections. In Joburg, struggle veteran Frank Chikane, businessman and former national deputy finance minister Jabu Moleketi, incumbent Dada Morero, and the ANC’s regional chair Loyiso Masuku (allied politically to Deputy President Paul Mashatile) are all in the running.
The key question voters should ask of any Joburg mayoral candidate — others include the DA’s Helen Zille, ActionSA’s Mashaba and Rise Mzansi’s Lukhona Mnguni — is whether they will have the stomach and political weight to target the corrupt, incompetent networks established over the past decade.
This should be the first task of any mayor taking over the seething mess that is the City of Joburg in November if they are to halt the decline of this “world-class African city” — the aspirational epithet the city gave itself, which is now mentioned only with bitter sarcasm and derision.
Marrian is a political analyst at the Bureau for Economic Research
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