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The Democratic Alliance (DA) welcomes National Treasury’s lawful and necessary decision to temporarily withhold the July 2026 equitable share transfers from iMpendle, uMzinyathi District, Newcastle, eMadlangeni, Amajuba District, AbaQulusi and uMkhanyakude District municipalities.

With a DA Deputy Minister of Finance helping drive accountability, this intervention sends an important signal that persistent non-compliance will be met with action.

The situation is a serious indictment of the political and administrative leadership that allowed these municipalities to reach this point.

The Constitution permits National Treasury to withhold transfers where municipalities persistently and seriously fail to meet financial obligations. These municipalities were warned, guided and given opportunities to explain why funding should not be withheld.

Treasury’s decision exposes a failure to act. Municipal leaders knew the risks, yet failed to implement the corrective measures before Treasury intervened. Municipalities cannot adopt unfunded budgets, fail to address unauthorised, irregular, fruitless and wasteful expenditure, neglect creditors and expect business as usual.

When they fail to pay Eskom and water boards, residents suffer electricity restrictions, load rotation, water throttling and service disruptions. Treasury’s intervention is not intended to punish residents or undermine service delivery. It is intended to compel municipalities to correct persistent financial failures before further damage is done.

Several affected municipalities are, or were recently, IFP-led. The IFP, which claims it can deliver better local government, must account for failures that developed under the watch of its mayors and councillors. It cannot blame municipal officials. Mayors and councils approve budgets, oversee municipal finances and are responsible for corrective action and consequence management. Political leadership means acting before National Treasury is forced to withhold funding to compel legal compliance.

Each municipality must now submit a corrective plan, including funded budgets, workable payment arrangements with creditors, investigations into unlawful expenditure and action against those responsible. Funds should not be released on the strength of another Council resolution or political assurance. Municipalities must provide documented proof that corrective steps have been taken.

National Treasury has acted. Political parties must now take responsibility for the municipalities they govern.

Issued by: Marlaine Nair, MPL - DA KZN Spokesperson on CoGTA