Nelson Mandela Bay Moves to Restore Withheld Treasury Funding

Municipal leaders stressed that the temporary withholding of the equitable share allocation will not interrupt the delivery of critical public services.

The Nelson Mandela Bay Municipality has assured residents, businesses and investors that the temporary withholding of its July 2026 equitable share allocation by National Treasury does not mean the metro is financially insolvent or unable to continue delivering essential municipal services.

The reassurance follows National Treasury's decision to suspend July transfers to several municipalities after identifying what it described as persistent and serious non-compliance with the Municipal Finance Management Act (MFMA). The move is intended to strengthen financial governance and ensure municipalities meet legal financial management requirements.

Metro begins reforms to meet Treasury requirements

In response, the municipality said it respects National Treasury's oversight role and is working closely with both National Treasury and the Eastern Cape Provincial Treasury to meet all the conditions required for the release of the withheld funding.

Officials said a broad financial governance reform programme is already underway. The plan includes improving compliance with the MFMA, strengthening financial oversight, enforcing consequence management and ensuring cases involving unauthorised, irregular, fruitless and wasteful expenditure are handled in line with the law. The municipality added that these reforms are designed not only to address the current concerns but also to build a stronger and more accountable financial management system for the future.

Essential services will continue without interruption

Municipal leaders stressed that the temporary withholding of the equitable share allocation will not interrupt the delivery of critical public services. Officials said internal governance processes have already been activated to deal with the issues raised by National Treasury, while a dedicated multidisciplinary team is engaging directly with Treasury officials to resolve all outstanding matters as quickly as possible. The municipality said every effort is being made to minimise any impact on day-to-day operations and to maintain reliable service delivery for communities across the metro.

Municipality sees opportunity to strengthen governance

Beyond responding to the immediate intervention, Nelson Mandela Bay said it is focusing on improving its long-term financial sustainability through stronger revenue collection, tighter expenditure controls, improved governance systems and enhanced oversight by the Municipal Council and its oversight committees.

The Executive Mayor, Municipal Council and municipal administration reaffirmed their commitment to restoring full compliance with the legislative framework while ensuring responsible management of public funds. The municipality described National Treasury's intervention as an opportunity to strengthen financial management practices, improve institutional governance and rebuild public confidence. It also pledged to continue operating with transparency, accountability and sound financial stewardship in the interests of residents, businesses and investors.