A letter from South Africa’s National Treasury to the Executive Mayor of Johannesburg has intensified concerns over the City’s worsening financial condition, with ActionSA saying the warning validates concerns it has raised for months about unsustainable financial commitments and governance failures.
In a media statement released recently, ActionSA said the Treasury letter highlighted serious problems within the City of Johannesburg, including possible violations of the Municipal Finance Management Act (MFMA), deteriorating governance, severe liquidity pressures, and growing creditor obligations.
According to ActionSA, one of the most significant issues raised by Treasury was the instruction for the City to halt implementation of a salary agreement linked to the Politically Facilitated Agreement. Treasury reportedly warned that Johannesburg cannot afford the commitment in its current financial state.
ActionSA argued that this confirms the party’s long-standing position that while municipal workers deserve fair wages and dignity, any salary agreements must be lawful, financially sustainable, and properly authorised.
The party stated that it had consistently warned against making promises that could place both workers and the City at financial risk. It emphasised that its approach was not politically motivated, but rooted in governance and accountability.
ActionSA further outlined several steps it had taken regarding the issue, including engagements with organised labour, the South African Local Government Bargaining Council (SALGBC), the Gauteng MEC for Cooperative Governance and Traditional Affairs (CoGTA), the Speaker of Council, and the City Manager. The party also communicated directly with workers and explored possible legal interventions.
ActionSA criticised the Gauteng MEC for CoGTA for recently informing the Provincial Legislature that the matter had been resolved, arguing that the Treasury letter proves the crisis remains unresolved.
The party warned that Johannesburg residents are already experiencing the effects of financial instability through deteriorating infrastructure, unreliable service delivery, governance failures, and declining public confidence in the City’s administration.
ActionSA has now called on the City of Johannesburg, the Gauteng Provincial Government, and all relevant stakeholders to act urgently and transparently to stabilise the City’s finances and protect both residents and workers from further harm.
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