PRETORIA — South Africa municipalities continue to battle severe governance and service delivery challenges, according to the latest Auditor-General of South Africa (AGSA) report, which highlights limited progress despite years of intervention. The findings reveal that many local governments are grappling with weak finances, poor accountability, and failing infrastructure, raising significant concerns about basic service delivery ahead of the local government elections.
According to the Auditor-General, while some municipalities have shown improvement, many in the Free State, North West, and Mpumalanga continue to struggle with weak financial controls, poor accountability, and deteriorating infrastructure. Mpumalanga remains plagued by financial problems, while some municipalities in Limpopo are moving into the yellow zone. Even traditionally well-performing municipalities, including those in Limpopo and the City of Cape Town, are showing signs of strain.
“We also started to see pressure in terms of quality of infrastructure, pressure in terms of even financial health,” the Auditor-General noted.
The report indicates that more than half of the municipalities received the exact same audit outcomes they had five years ago, with only 39 achieving clean audits. The Auditor-General warned that these systemic failures have real consequences for residents who rely on local authorities for basic services.
Financial health remains a critical concern. Many municipalities continue to flout procurement rules, spend money irregularly, and struggle to account for how public funds are utilized. Municipalities with recurring audit findings accounted for nearly half of all irregular expenditure across local governments.
“Financial distress is systemic and it is persistent,” the Auditor-General stated, adding that a large number of municipalities are facing significant financial health pressures.
The report also highlighted a continued reliance on consultants. Despite spending millions on outsourced expertise, many municipalities still receive poor audit outcomes, raising concerns about skills shortages, weak accountability, and poor value for money.
Addressing the scale of financial mismanagement, the Auditor-General commented on the irregular expenditure figures: “We are often very cautious to quote the number of 40,000 irregular expenditure because at least 14% of municipalities did not disclose the full extent of their irregular expenditure. So we know that the number is under-reported.” The Auditor-General emphasized that the data still reveals a high tendency to avoid dealing with irregular expenditure.
Weak leadership, poor oversight, and a lack of consequences for wrongdoing continue to undermine progress. Seven municipalities have received the worst possible audit outcome—a disclaimer—for between three and ten years. A disclaimer indicates that auditors could not obtain sufficient evidence to verify large parts of a municipality’s financial statements.
However, there are some signs of improvement. The number of disclaimer audits has fallen, more municipalities are submitting their financial statements on time, and the number of credible financial statements has increased.
Despite these incremental gains, Members of Parliament argue that progress remains far too slow. Criticizing the current approach to accountability, Members of Parliament stated, “We are too accommodating. We are too soft. And we are allowing these people to continue doing the wrong thing. And it’s not like they’re doing it without knowing on their license they’re doing wrong.”
The Auditor-General emphasized that turning municipalities around will require stronger leadership, better financial management, and decisive action against those responsible for repeated failures. This must start with “ensuring that the executive leaders that are deployed by political parties be people who have the capability and the integrity” required for the roles.
Without such interventions, the Auditor-General warned, conditions in local government will continue to deteriorate. For residents, the stakes are straightforward: when municipalities fail, communities are left with broken infrastructure, unreliable services, and stalled development.
