The City of Johannesburg must stop budgeting on wishful thinking and start budgeting within its fiscal reality, says the Johannesburg Community Action Network (JoburgCAN).
In its detailed submission on the city’s draft 2026/27 Budget and Integrated Development Plan (IDP), JoburgCAN said the city should take a more conservative and realistic approach to service delivery, rather than adopting a budget that risks pushing Johannesburg further into debt.
Find our 2026-2027 CoJ Draft Budget and IDP submission documents here
JoburgCAN managing director Julia Fish said the city must “budget on achieved revenue, not further debt impairment”.
“Our city is clearly in a precarious financial position. The recent rebuke by Finance Minister Enoch Godongwana effectively called the 2025/26 Adjustment Budget illegal. We may be in an election year, but that does not mean the city should continue to risk another unfunded budget,” said Fish.
Local government elections are scheduled to take place on 4 November 2026.
The draft IDP and budget set a revenue collection target of 91%, despite the city’s own draft 2026/27 financial measures showing that collections dropped to 86% in 2024/25.
“This creates the risk of a heavy downward adjustment if current collection trends continue. The city should instead focus on adjusting upwards only if revenue enhancement measures succeed. Otherwise, the budget is effectively unfunded,” said Fish.
JoburgCAN said the city’s debt impairment target is 37%. Debt owed to the city for service charges and rates is actually expected to grow by a 34.5% increase in three years.
The impaired portion of that debt is expected to grow by a massive 41% increase.
JoburgCAN said this over-extension is being pushed despite the city’s cash coverage dropping from 47.8 days in 2020/21 to just 15 days in 2024/25. National Treasury recommends a minimum cash coverage level of 30 days.
Fish said the lack of clear targets and turnaround strategies at key entities such as the Johannesburg Roads Agency and the non-implementation of the Johannesburg Water strategy is equally concerning, particularly because the city raises revenue through levies and surcharges that are meant to support service delivery.
These include:
- the water demand management levy charged to all customers;
- the City Cleaning Levy charged on all non-residential properties;
- the electricity network surcharge of 6c/kWh on all electricity consumers, except the first 500kWh a month of domestic usage; and
- the 2% surcharge on business and large power users.
Fish said these levies are not clearly accounted for and do not appear to be automatically transferred to the entities they are meant to support. Instead, they appear to remain in the city’s general account.
“The additional revenue collected through levies should be clearly identified in the budget, showing both the amount collected and its direction to the relevant utility,” said Fish.
She said the city’s fixed charges policy is also counterproductive. Instead of reducing usage, it risks pushing residents to opt out of municipal supply or connect illegally.
Fish said one of the biggest red flags in the budget is executive pay and the planned increase in senior managers and overall staff numbers.
Almost 30% of the draft operating budget goes towards staff and wages.
“The city appears to be paying heads of entities above the remuneration limits that apply to municipal managers and managers who report directly to municipal managers. The city should explain the legal basis for this approach,” said Fish.
The maximum remuneration for a municipal manager is R3 665 914, while the maximum for managers reporting directly to the municipal manager is R2 757 853.
The city budgets to pay the city manager R2 774 127, which is within the limit. However, the executive director: economic development is budgeted at R2 807 000, which is above the limit. The secretary to council, at R2 768 606, and the ombudsman, at R2 670 000, are also above the limit.
JoburgCAN said 12 of the heads of the city’s 13 entities are paid above the limit. The highest-paid is the Joburg Property Company CEO, at R5 497 553.
The draft 2026/27 Budget also shows a sharp increase in senior managers over two years, from 330 to 1025, while the number of “other managers” decreases.
“These changes all need explanation, particularly in light of unfunded budget allegations by National Treasury and as part of the wider picture of financial strain,” said Fish.
In a letter sent by Finance Minister Enoch Godongwana to Johannesburg Mayor Dada Morero on 23 April 2026, the minister accused the city of “serious violations” of the Municipal Finance Management Act and related regulations, and pointed to a deterioration in the city’s governance and financial health.
Fish said JoburgCAN’s submission acknowledges that Johannesburg is under intense pressure to deliver services and infrastructure but said this cannot be used to justify an unrealistic budget.
“Every resident will tell you that there is massive urban decay, regular lawlessness and a growing trend to refuse to abide by bylaws such as building regulations. But the city is not helping resolve these issues by creating a budget that places further pressure on residents through increased local taxes. Instead, the city should be placing greater attention on reforming from within. Sadly, this budget pays lip service to the issues the city faces internally but does not take residents into its confidence that it intends to tackle such matters with urgency.
“All residents see are higher prices, overpaid staff, reduced services and collapsing infrastructure. That is not a healthy social compact at all,” said Fish.
For media queries contact Jonathan Erasmus on 073 227 6075.