North West — Finance Minister Enoch Godongwana has delivered a revised financial recovery plan to the Ditsobotla Local Municipality, marking a critical intervention in a council that has faced severe governance collapse and service delivery failures.
According to local government expert Dr. Thina Nzo of the Public Affairs Research Institute, Ditsobotla’s dysfunction stems from deep-rooted political factions and institutional breakdowns. The municipality gained notoriety for having two individuals simultaneously claiming the mayoral position, creating confusion over political authority and administrative leadership.
Dr. Nzo explained that the situation mirrors challenges previously seen in the Thabazimbi Local Municipality in Limpopo and the Phokwane Municipality in the Northern Cape, where political divisions directly contributed to institutional failure and financial insolvency.
Approximately eight months ago, National Treasury, in consultation with Parliament’s Cooperative Governance committee and the National Council of Provinces, placed Ditsobotla under administration in terms of Section 139 of the Constitution. While there were discussions about dissolving the council entirely, the decision was made to pursue a structured recovery process.
An administrator has since conducted diagnostic reviews and worked to stabilise municipal operations, paving the way for the adoption of the Treasury-backed financial recovery plan. However, Dr. Nzo cautioned that success remains uncertain, particularly as the country enters a local government election campaigning period, which may affect political cooperation.
“The administrator does have jurisdictional authority to compel council to adopt the recovery plan,” Dr. Nzo stated. “It is there to ensure stability, financial management, and cost recovery—including addressing alleged payments to ghost workers and the employment of unqualified personnel.”
A significant challenge lies in the municipality’s bloated workforce. Minister Godongwana noted that while the council should employ approximately 450 staff, it currently has over 700. Dr. Nzo highlighted the complexity of addressing this issue, as many employees are permanent staff in lower-level positions such as cleaners and public facility workers, often hired through public works programmes with expectations of permanent absorption.
National Treasury mandates that municipalities cap wage bills at 35–38% of total expenditure and adhere to strict competency frameworks and organisational structures. However, resistance to reviewing organograms and aligning staff with service delivery units has historically hindered compliance.
Further complications arise from the need to engage with trade unions and bargaining councils when considering staff adjustments. Senior managers implicated in irregular appointments may also face scrutiny, with investigation reports to be submitted to COGTA, National Treasury, and relevant provincial and national oversight committees.
Dr. Nzo emphasised that while the process requires negotiation and time, urgency is heightened by the upcoming local government elections. “Which councillor would want to enter into a council that is not at the best position it should be in when it comes to governance matters?” she asked.
The Minister’s concerns extend beyond Ditsobotla. He has also expressed strong dissatisfaction with the City of Johannesburg’s financial management, citing an underfunded budget, poor revenue collection, and non-compliance with Treasury regulations.
Dr. Nzo noted that National Treasury holds significant leverage, including the ability to withhold grants—a measure that could prove disastrous for Johannesburg, which reportedly faces a R200 million budget shortfall and owes service providers approximately R25 million dating back to 2023.
“Johannesburg will have to negotiate with National Treasury on how to put systems in place to circumvent these adverse findings,” Dr. Nzo said. “Otherwise, National Treasury is going to close the tap.”
As Ditsobotla embarks on its recovery journey, the broader implications for municipal governance and fiscal discipline across South Africa remain under close observation.
