Financial turmoil has deepened at the embattled Maluti-a-Phofung Local Municipality, which has informed its staff that it will be unable to pay July salaries due to an ongoing and seemingly intractable deadlock with National Treasury. The municipality, already struggling under a heavy burden of debt and governance challenges, issued an internal memo this week notifying employees of the delay and offering a terse apology for the inconvenience caused.
The memo, seen by local media, attributed the cash flow crisis to a freeze on municipal accounts imposed by National Treasury as part of a broader intervention aimed at stabilising the financially distressed municipality in the eastern Free State. Officials have been locked in discussions with Treasury for weeks, attempting to unlock the funds necessary to meet the payroll, but those negotiations have yet to yield a breakthrough. “We are doing everything in our power to resolve this matter urgently,” the memo reads. “Management is engaging at the highest levels to ensure that our employees receive their rightful compensation.”
The news has sparked anxiety and frustration among municipal workers, many of whom rely on their monthly salaries to support their families and meet basic obligations such as rent, school fees, and utility bills. Labour unions representing municipal employees have threatened to escalate the matter, warning that they cannot afford to wait indefinitely. “This is not acceptable,” said a union representative. “Workers cannot be held hostage by administrative failures.”
The Maluti-a-Phofung municipality, which includes the towns of Phuthaditjhaba, QwaQwa, and surrounding areas, has a long history of financial distress, including multimillion-rand debts to Eskom and water boards. The latest salary delay is the most immediate symptom of a deeper systemic crisis that has left the municipality on the brink of collapse. Residents fear that if the impasse continues, essential services such as waste collection and water supply could also be affected. National Treasury has yet to comment publicly on the deadlock.
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