South African Finance Minister Enoch Godongwana has told Johannesburg mayor Dada Morero that the city is in severe financial distress and cannot afford a R10.3-billion wage agreement signed with municipal workers last year.
In a letter sent around 23 April, Godongwana stated that creditors are owed R25.2-billion while the city holds only R3.9-billion in cash. He described the agreement with the SA Municipal Workers’ Union, concluded in November 2025, as illegally signed and unfunded. The minister warned he would withhold an R8-billion equitable share grant unless the deal is halted.
The city has already overspent on staff costs and operations. Johannesburg lost R12.9-billion to unauthorised expenditure in 2023/24, and its debt-to-revenue ratio rose 29 percent in the following year. Credit ratings agency Moody’s placed the city’s debt on review for downgrade in April, while the Johannesburg Stock Exchange suspended its debt securities in March.
Opposition parties and civil society groups have called for urgent action. DA mayoral candidate Helen Zille said the letter was the bluntest she had seen in her career and urged financial administration under National Treasury. The ANC in Johannesburg requested an urgent meeting with the minister to protect workers’ interests.