---
title: "Zweli Mkhize says blocking municipal funds a ‘last resort’ as Parliament urgently intervenes"
description: "As the cooperative governance committee prepares its urgent intervention, chair Zweli Mkhize defends Treasury’s action – but admits the blunt strategy is hitting a dangerous limit. Johannesburg, meanwhile, has clammed up on how it’s holding rotten officials to account."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "TREASURY CHOKEHOLD"
author: "Anna Cox"
author_url: "https://www.dailymaverick.co.za/author/anna-cox/"
canonical_url: "https://www.dailymaverick.co.za/article/2026-07-16-zweli-mkhize-says-blocking-municipal-funds-a-last-resort-as-parliament-urgently-intervenes/"
published: "2026-07-16T21:26:50"
lang: "en-ZA"
word_count: 1580
---

# Zweli Mkhize says blocking municipal funds a ‘last resort’ as Parliament urgently intervenes

> As the cooperative governance committee prepares its urgent intervention, chair Zweli Mkhize defends Treasury’s action – but admits the blunt strategy is hitting a dangerous limit. Johannesburg, meanwhile, has clammed up on how it’s holding rotten officials to account.

By Anna Cox · Published 16 July 2026, 23:26 SAST

## Key points
- Parliament is urgently meeting to address the cash freeze affecting Johannesburg and 68 other municipalities, risking severe service delivery impacts for residents.
- National Treasury's funding halt aims to compel local councils to tackle corruption, but critics argue it punishes the poorest citizens while corrupt officials remain unscathed.
- Zweli Mkhize defends the freeze as a necessary measure but acknowledges it's reaching dangerous limits, warning that municipalities must demonstrate accountability to unlock funds.
- The City of Johannesburg remains silent on accountability for corrupt officials, raising concerns about the effectiveness of oversight amid a cycle of financial mismanagement.

## Content

A high-stakes meeting is sitting in Parliament on Friday, 16 July, to decide the financial future of Johannesburg and 68 other municipalities.

This emergency joint session was called by Parliament’s Portfolio Committee on Cooperative Governance and Traditional Affairs, chaired by Dr Zweli Mkhize, alongside the chairpersons of Parliament’s finance, public accounts (Scopa) and appropriations committees.

The intervention was triggered after the Financial and Fiscal Commission (FFC) sounded the alarm over the legality of the cash freeze to the 69 municipalities. With a constitutional dispute brewing over who actually controls local funding, Parliament’s oversight committees stepped in to haul the ministers of finance and cooperative governance and traditional affairs, the South African Local Government Association (Salga) and provincial leaders into one room for a Friday showdown to force a resolution.

[Read more

Treasury’s municipal state of emergency: Great start but martial law is needed

July 12, 2026 ![Image](https://cdn.dailymaverick.co.za/i/0X3jyDYwUmucL_XwWVTeZamN9pg=/450x0/smart/file/attachments/2994/image_936539.png)](https://www.dailymaverick.co.za/article/2026-07-12-treasurys-municipal-state-of-emergency-great-start-but-martial-law-is-needed/)

At the heart of the clash is National Treasury, which wants to stop the transfer of R13.5-billion in funding to these 69 broke local councils, arguing that freezing this money is the only way to force these cities to hold corrupt and failing officials accountable, implement consequence management and pay their massive, long-overdue bills to Eskom and the water boards.

This money, called the “equitable share”, is not just paperwork. It is the exact cash used to buy bulk water, pay for electricity and keep municipal buses fuelled.

### Mkhize hits back

In an exclusive, hard-hitting response to Daily Maverick, Mkhize defended Treasury’s legal right to squeeze these bankrupt councils. He placed the blame squarely on local administrations that have ignored years of warning signs, calling the funding freeze a necessary tool to smash local corruption.

“Section 216 is a constitutionally prescribed intervention in cases of non-compliance,” Mkhize told Daily Maverick.

“This intervention, though, is not a criminal procedure directed at corrupt officials. It is, however, a strong enough mechanism to force municipalities to take responsibility and hold all transgressors and corrupt officials accountable. The conditions set by the Treasury require municipalities to disclose actions to be implemented to ensure consequence management. This should begin to trigger a change away from a culture of impunity.”

![Andisa-Directors](https://cdn.dailymaverick.co.za/i/iGoovxBcNq4l6j6r0RLgTOkCN9E=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/WhatsAppImage2026-04-07at154656_852209.jpeg)

*Chairperson of the Parliament’s Portfolio Committee on Cooperative Governance and Traditional Affairs Dr Zweli Mkhize in Nelson Mandela Bay on 24 March 2026. (Photo: Phando Jikelo / RSA Parliament)*

Mkhize insisted that the focus must remain on the municipalities’ own failure to act on previous audit warnings.

“The challenge, therefore, is not Treasury action but the municipalities’ lack of response in all previous reports and calls for action. Treasury actions should be seen as an unavoidable and last resort in cases where municipalities have long been called upon to implement consequences management and turn the situation around.”

### Punishing the wrong people

Despite Mkhize’s defence, the FFC and Salga argue that withholding this money is bound to affect basic service delivery, turning the streets of South Africa’s biggest cities into dumping grounds. They point out a massive flaw in the strategy: this cash freeze uses ordinary citizens as human shields while the guilty officials get off completely free.

When Treasury locks the safe, it is the poorest residents who lose their water and electricity, while rubbish piles up on their doorsteps. Meanwhile, municipal watchdogs point out that the corrupt politicians and managers who signed reckless deals and ignored warnings face zero personal consequences. They keep their high-paying jobs and their political protection, untouched by the very crisis they created.

![Anna-parly-crooks](https://cdn.dailymaverick.co.za/i/jiDP8SMB5jtbW9RXNoz0nPV66Pg=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/ED_416585_897137.jpg)

*Potholes on the streets of Katlehong on 1 November 2022. (Photo: Gallo Images / Fani Mahuntsi)*

Mkhize himself openly admitted to Daily Maverick that this blunt strategy is hitting a dangerous limit and cannot go on forever.

“Parliament took into account that the withholding of the equitable share cannot be left indefinite,” Mkhize acknowledged.

“There has to be demonstrable movement from municipalities to comply, and for Treasury to actively monitor municipalities’ responses to release funds where compliance has been achieved. Parliament needs to stay on top of the issues to prevent the withholding of funds from dragging on until communities are adversely affected.”

Asked why the state is resorting to starving entire cities of cash instead of directly pursuing and criminally prosecuting the corrupt officials who actually wasted the billions, Mkhize pointed to the legal red tape that shields local administrators.

[Read more

‘Critical services may stop’ — NMB fears the worst after Treasury withholds payment

July 14, 2026 ![Image](https://cdn.dailymaverick.co.za/i/ijWHQDqMDWPZJvzqXHskb8MjI4I=/450x0/smart/file/attachments/orphans/DSC_6219-copy_794401.jpg)](https://www.dailymaverick.co.za/article/2026-07-14-critical-services-may-stop-nmb-fears-the-worst-after-treasury-withholds-payment/)

He explained that national government cannot simply bypass local government to institute criminal charges. Under the law, the primary duty to investigate, run disciplinary hearings and refer criminal cases to the police lies with the municipalities themselves.

When local councils fail to do this, Mkhize noted, provincial and national government interventions are bound by slow, complex constitutional steps. These processes, he admitted, “may be onerous and create the impression that the government has not acted or has taken a long time to do so”.

### A failed, repeating cycle

Treasury officials and supporters of the cash freeze say it is “tough love” that works, pointing out that a similar freeze was successfully used on 75 municipalities last year to force councils to sign debt-repayment agreements with Eskom and water boards.

But municipal analysts and critics say this is a temporary plaster on a deep cancer. Signing a repayment plan on a piece of paper does not magically fix broken municipal billing systems or root out institutional corruption. Instead, they argue, it creates a seasonal crisis where the same cities find themselves right back on the chopping block year after year.

### The City of Joburg remains silent

While Parliament scrambles to manage the damage on Friday, the City of Joburg is hiding behind a wall of silence about who, if anyone, is actually being held accountable.

On 10 June, Daily Maverick sent a detailed set of questions to the City’s administration, asking for real accountability regarding the findings raised by the Auditor-General on corrupt officials. We repeatedly asked for answers again on 9 and 15 July, with no response.

![Anna-parly-crooks](https://cdn.dailymaverick.co.za/i/3x3FO9Ga_sTRDtYPcb-UVo_wfs8=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/ED_519840_479538.jpg)

*Johannesburg mayor Dada Morero during the service delivery programme at Moletsane sports complex in Soweto on 6 September 2024. (Photo: Gallo Images / Fani Mahuntsi)*

![Anna-parly-crooks](https://cdn.dailymaverick.co.za/i/LcOAcIG9Q2Tdes4tZUkOA5YroXc=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/ED_411444_825816.jpg)

*People queue for a water truck in Coronationville on 5 October 2022. Water systems had reportedly been turned off since Tuesday owing to massive infrastructure breakdown and a power outage at the Vereeniging Treatment Plant. (Photo: Gallo Images / Rapport / Elizabeth Sejake)*

By staying silent on who is actually being punished, local leadership only confirms the worst: that while the national government fights over municipal budgets in Cape Town, the local officials responsible for the financial rot are walking free – leaving ordinary citizens to pay the ultimate price.

These are the questions Daily Maverick first sent on 10 June, which the City of Joburg has refused to answer:

- Please provide a list of the 34 cases currently before the City’s disciplinary board and under investigation. For each of these 34 cases, please indicate: The department, municipal entity or business unit involved; the nature of the allegations; the date the matter was reported; the current status of the investigation or disciplinary process; and whether the matter involves a senior manager, Section 56/57 official or other employee;
- The city manager’s administration previously indicated that six criminal cases have been referred to law enforcement agencies. Please provide details of each case, including: The nature of the alleged offence; the department or entity involved; the date the matter was referred; the law-enforcement agency handling the matter; and the current status of the investigation;
- Please confirm whether any arrests, criminal charges, disciplinary findings, suspensions, dismissals or recoveries of funds have resulted from these six criminal matters;
- It was previously stated that a further 36 matters have been referred to council for investigation. Please provide: A list of these matters; the departments or entities involved; the nature of the concerns being investigated; and the status of each investigation;
- It was indicated that six investigations have been completed and that reports are expected to be submitted to council by the end of June. Please provide: The subject matter of these investigations; the departments or entities involved; the key findings; and whether any disciplinary, civil or criminal action has been recommended;
- How many of the disciplinary, criminal and council investigations currently under way stem directly from findings raised by the Auditor-General?
- Please provide details of the eight historical material irregularities that the administration stated have been resolved and certified by the Auditor-General. For each of these eight material irregularities, please indicate: The audit year; the AG reference number; the nature and financial value of the irregularity; the department involved; the corrective action taken; whether action was instituted against officials; and the date certified as resolved;
- How many disciplinary matters relating to irregular expenditure, procurement irregularities, fraud, corruption or financial misconduct remain outstanding within the City and its entities?;
- Does the City believe the current disciplinary board and investigative processes have sufficient capacity to deal with the volume of matters currently under investigation? What is the average turnaround time?; and
- Can the City provide statistics on how many officials have been disciplined, dismissed, criminally charged or had losses recovered from them during the 2024/25 and 2025/26 financial years as a result of investigations into misconduct, fraud, corruption or irregular expenditure?

This multibillion-rand chokehold extends far beyond Joburg, and includes other major metros and industrial hubs across the country, including Mangaung, Nelson Mandela Bay, Buffalo City and Emfuleni. **DM**