North West Welcomes Release of Withheld Municipal Funding

Mosenogi said the provincial government had worked closely with municipalities to help them meet National Treasury's conditions for the release of funds.

North West Finance MEC Kenetswe Mosenogi has welcomed the decision by Finance Minister Enoch Godongwana to release the remaining withheld Local Government Equitable Share allocations to affected municipalities from 31 July 2026, describing the move as an important step towards restoring financial stability and improving service delivery across the province. The release follows a period during which equitable share transfers to 12 municipalities were temporarily withheld under constitutional and Municipal Finance Management Act (MFMA) provisions to encourage stronger financial discipline, accountability and compliance.

By the time the latest decision was announced, six of the affected municipalities had already received their full equitable share allocations. The remaining municipalities, including Madibeng, JB Marks, Matlosana, Mahikeng, Maquassi Hills and Dr Ruth Segomotsi Mompati, became eligible to receive their outstanding allocations from 31 July.

Mosenogi said the provincial government had worked closely with municipalities to help them meet National Treasury's conditions for the release of funds. She added that while progress had been made, six municipalities remained under close monitoring because of slow progress in addressing Unauthorised, Irregular, Fruitless and Wasteful Expenditure (UIF&WE) and limited implementation of consequence management measures.

She said restoring financial stability in local government remains essential to ensuring communities receive reliable and consistent basic services.

Treasury Strengthens Municipal Financial Management

Provincial Treasury has introduced several support measures to help municipalities improve governance and financial management. These include guidance on investigating UIF&WE cases, strengthening oversight through Municipal Public Accounts Committees and disciplinary boards, and improving accountability within local councils.

Mosenogi also highlighted unpaid municipal accounts by government departments and public entities as one of the biggest challenges affecting municipal finances. To address this, Provincial Treasury has coordinated a programme involving provincial departments, municipalities and public entities to verify outstanding balances, resolve billing disputes, improve financial records and establish structured payment arrangements.

According to the June 2026 municipal debt reconciliation, outstanding debt owed by provincial departments to municipalities fell from R1.010 billion reported in March 2026 to R893.1 million, representing a reduction of approximately R116.9 million, or 11.6%.

Focus Turns to Debt Settlement

Government departments have been instructed to settle all undisputed municipal debt immediately, while payment agreements for outstanding balances must be finalised before the end of August 2026. All disputed municipal accounts are expected to be resolved by September 2026 following reconciliation processes.

Mosenogi stressed that legitimate municipal debt will continue to be paid, though invoices affected by inaccurate municipal billing systems will first need to be verified. She said correcting billing systems will improve the credibility of municipal financial information and strengthen confidence in local government finances.

Preparing for Future Funding Allocations

Provincial Treasury, together with the Department of Cooperative Governance, Human Settlements and Traditional Affairs, will continue supporting municipalities to strengthen financial management ahead of the December 2026 equitable share allocation.

District-specific debt reconciliation sessions will take place during August, bringing together municipalities and government departments to resolve outstanding accounts and ensure compliance with National Treasury requirements. Mosenogi urged municipalities to use these engagements to strengthen financial governance and secure future funding while building more sustainable local government finances.