{"id":837849,"date":"2025-09-18T10:30:00","date_gmt":"2025-09-18T08:30:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=837849"},"modified":"2025-09-18T10:04:49","modified_gmt":"2025-09-18T08:04:49","slug":"south-africas-plan-to-stop-its-biggest-cities-from-collapsing","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/837849\/south-africas-plan-to-stop-its-biggest-cities-from-collapsing\/","title":{"rendered":"South Africa’s plan to stop its biggest cities from collapsing"},"content":{"rendered":"\n

South Africa\u2019s metros are facing a crisis, with the government stepping in to ensure that R54 billion in grants must be based purely on performance, not promises. <\/p>\n\n\n\n

South Africa\u2019s biggest cities are home to close to half of of South Africa\u2019s population, businesses, and jobs. <\/p>\n\n\n\n

However, weak management, underinvestment, corruption, and unreliability in electricity and waste services have constrained growth. <\/p>\n\n\n\n

The Auditor General has reflected the poor governance, noting that only one out of eight metros received a clean audit, that being the City of Cape Town. <\/p>\n\n\n\n

AG Tsakani Maluleke said this doesn\u2019t make sense given how large the metros\u2019 budgets are.<\/p>\n\n\n\n

\u201cThe eight metros across the country look after half of the expenditure budget for local government and provide services to 46% of South African households,\u201d she explained. <\/p>\n\n\n\n

\u201cTheir budgets are significant, and they sit in economic activity centres. They should have no difficulty attracting the skills they need to run their environments.\u201d<\/p>\n\n\n\n

Nevertheless, most metros are failing to meet even basic accounting standards.<\/p>\n\n\n\n

These financial management failures are linked to poor basic service delivery. <\/p>\n\n\n\n

Case in point is the City of Johannesburg, which has almost a R90 billion budget, with most of the city\u2019s traffic lights seeming abandoned, and local roads are left to decay. <\/p>\n\n\n\n

Business Leadership South Africa (BLSA) Busi Mavuso said that the city\u2019s poor performance has become a national embarrassment, as the city plans to host the G20 Summit later this year. <\/p>\n\n\n\n

The government\u2019s plan\u00a0<\/h2>\n\n\n
\n
\"Deputy<\/a>
Deputy Finance Minister David Masondo <\/figcaption><\/figure><\/div>\n\n\n

The government is responding to the crisis facing South Africa\u2019s cities via structural reforms from Operation Vulindlela, a joint initiative between the National Treasury and the Presidency.<\/p>\n\n\n\n

While the first phase of the initiative focused on electrical, water and logistics infrastructure, the second phase is looking to improve local governance. <\/p>\n\n\n\n

This was highlighted by Deputy Finance Minister David Masondo when he spoke at the RMB Morgan Stanley 2025 Investor Conference. <\/p>\n\n\n\n

Masondo noted that economist growth requires structural reforms and that Operation Vulindlela remains the state\u2019s vehicle for unlocking bottlenecks. <\/p>\n\n\n\n

This is particularly true for Phase 2 of Operation Vulindlela  – the Metro Trading Services Reform. <\/p>\n\n\n\n

The Metro Trading Services Reform aims to create financially ring-fenced, professionally managed utilities within metros, which aim to restore sustainability to essential services.<\/p>\n\n\n\n

He noted that access to a new R54 billion performance-linked incentive grant is strictly conditional on council-approved turnaround plans and adherence to clear accountability standards.<\/p>\n\n\n\n

\u201cThis is not money for promises \u2014 it is money for performance. Only metros demonstrating measurable improvements in service delivery, financial performance, and governance will qualify.\u201d <\/p>\n\n\n\n

\u201cThe intention is to crowd in investment. For every rand of incentive funding, metros are expected to leverage at least another rand, mobilising an additional R108 billion into infrastructure.\u201d <\/p>\n\n\n\n

Masondo said that the impact will be significant, with reliable trading services strengthening municipal finances, attracting investment and boosting urban growth. <\/p>\n\n\n\n

He added that the reform will create new opportunities for financial institutions and investors.<\/p>\n\n\n\n

\u201cLower risk, greater transparency, and stronger governance will open the door for financing water, sanitation, energy, and waste infrastructure \u2014 projects that improve lives and generate sustainable returns.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Deputy Finance Minister David Masondo has broken down the state’s plan to fix South Africa’s ailing metros. <\/p>\n","protected":false},"author":95,"featured_media":813222,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[2890,2214],"class_list":["post-837849","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-morgan-stanley","tag-rmb"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837849","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=837849"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837849\/revisions"}],"predecessor-version":[{"id":837861,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/837849\/revisions\/837861"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/813222"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=837849"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=837849"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=837849"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}