The Nelson Mandela Bay Municipality has sought to reassure residents, businesses and investors that National Treasury's decision to temporarily withhold its July 2026 equitable share allocation does not constitute a declaration that the metro is financially insolvent or incapable of delivering services.
The assurance follows National Treasury's announcement that it is temporarily withholding the July 2026 equitable share transfers to several municipalities, including Nelson Mandela Bay, to enforce compliance with the Municipal Finance Management Act (MFMA) and strengthen financial governance.
In a statement issued on Tuesday, Treasury said the intervention was prompted by what it described as "persistent and serious non-compliance" with the MFMA.
Responding to the decision, the municipality acknowledged the temporary withholding of the allocation, saying it is currently implementing corrective measures to address Treasury's concerns.
“The municipality respects the constitutional and legislative oversight role of National Treasury and remains fully committed to working collaboratively with both National Treasury and the Provincial Treasury to satisfy all conditions required for the release of the temporarily withheld allocation,” the municipality said.
The metro said it has already commenced a comprehensive programme of financial governance reforms aimed at strengthening compliance with the MFMA, improving financial oversight, enhancing consequence management, and ensuring that all matters relating to unauthorised, irregular, fruitless and wasteful expenditure are dealt with in accordance with applicable legislation.
Efforts are also underway to improve the municipality's long-term financial sustainability through strengthened revenue management, tighter expenditure controls, enhanced governance systems and improved oversight by the Municipal Council and its oversight structures.
The municipality stressed that the temporary withholding of the equitable share would not disrupt the delivery of essential municipal services.
“Every effort is being made to minimise any potential impact on municipal operations and service delivery. Essential services, including water, sanitation, electricity, waste management, emergency services and other frontline municipal services, remain the municipality's highest priority.
“Residents should be assured that the municipality has activated the necessary internal governance processes to address the matters raised by National Treasury. A dedicated multidisciplinary team is engaging directly with National Treasury to ensure that all outstanding requirements are addressed as expeditiously as possible,” the municipality said.
The municipality said the Executive Mayor, together with the Municipal Council and administration, remains committed to restoring full compliance with the applicable legislative framework, strengthening institutional governance and ensuring prudent stewardship of public resources.
The municipality also described the intervention as an opportunity to further strengthen its financial management systems and reinforce public confidence in the institution.
It reaffirmed its commitment to transparency, accountability, good governance, and responsible financial management in the interests of all residents. – SAnews.gov.za
