City says debt relief working, critics warn of looming crisis
Opposition parties have raised alarm over the metro’s mounting debt and worsening service delivery, calling for urgent fiscal discipline and an end to political interference in financial management.
The metro has defended its controversial debt relief programme, maintaining that consumer debt has declined.
This comes after criticism from opposition parties who claim it encourages non-payment and threatens the metro’s financial health.
Opposition claimed that despite the debt relief programme, residents’ outstanding debt increased by more than R700-million in the previous financial year.
The Freedom Front Plus said it was particularly concerned about a 600% increase in new defaults within the 31-60-day payment period.
However, metro spokesperson Lindela Mashigo argued that consumer debt has been decreasing since the launch of the incentive in May.
“Between February and March, the debtors’ book fell by 13.56%, with a further drop from R26.6-billion to R25.8-billion over the next two months,” Mashigo said.
He said these figures prove the initiative is working, allowing residents to settle arrears and keep their accounts in good standing.
“The plan offers ratepayers a 70% discount on outstanding municipal bills if they pay the balance in full, and was introduced to address a historic R30-billion debtor’s ledger.”
Mashigo dismissed claims of a 600% spike in new defaults as ‘factually incorrect’.
“Nevertheless, the city remains committed to addressing all arrear accounts, particularly those that are 30 days and more in arrears.”
He said intensified credit control measures are being implemented to reduce the debtors’ book and to improve the overall payment levels.
“These measures include stricter enforcement of credit control policies, targeted customer engagement, and proactive monitoring of payment patterns to prevent accounts from falling into longer-term arrears.”
Mashigo stressed that the metro maintains a structured payment arrangement with Eskom, honoured in full and on time.
“We have never defaulted on our commitments to Eskom and disciplined financial management has kept essential services running.”
Despite the metro’s reassurances, opposition parties remain unconvinced.
FF Plus councillor Mark Surgeon. Photo: Facebook/Mark Surgeon
Freedom Front Plus Councillor Mark Surgeon warned that outstanding debt climbed by more than R700-million in the past financial year, even with the debt relief scheme in place.
He accused the ANC-led coalition of using the policy as a quick political fix rather than a long-term financial strategy.
“The FF Plus has always maintained that general debt write-offs foster a culture of non-payment,” said Surgeon.
Surgeon also cited a R2.28-billion increase in the city’s own debt in 2024/25 and a 43% rise in what it owes Eskom, warning of looming fiscal collapse.
He said underspending on projects further erodes public trust, calling the budget a “political wish list” rather than a binding service delivery plan.
Surgeon argued that without structural reforms, the debt crisis will only deepen, worsening service delivery and public confidence in municipal governance.
The DA shared similar concerns. Former MMC for Finance Jacqui Uys said the policy benefits residents who can pay but choose not to, while doing little for struggling households or for restoring payment discipline.
“The processes followed by the coalition do not ensure the inclusion of defaulting ratepayers back into the payment net,” she said.
Uys said the DA had proposed alternative repayment models to help those who want to pay but cannot, but these were rejected.
“The debtors’ book might even be closer to R28-billion,” said DA caucus leader in Tshwane Cilliers Brink.
Brink said it is clear that there hasn’t been an uptake by residents of the incentive scheme of the city.
“The DA warned that the scheme is inadequate, but the bigger problem is that credit control is not happening.”
He said other measures, such as rolling out smart meters to indigent residents, are also not happening.
“Instead of collecting what is already due to the city, the ANC coalition has sought to introduce a new tax, the so-called city cleansing levy. Now that the High Court has set the levy aside, it means that there is about R500-million shortfall on top of the R850-million shortfall from the financial year ending in June,” said Brink.
Mashigo insists that the metro’s approach, combined with stronger credit control and targeted revenue collection campaigns, will stabilise its finances and support long-term service delivery.
He said the underspending experienced in the 2024/25 financial year can largely be attributed to delays in project implementation, procurement processes, and the finalisation of contractor appointments.
“In some cases, unforeseen technical challenges and compliance requirements also contributed to slower capital expenditure. While underspending may temporarily affect the pace of certain service delivery projects, the city is actively working to fast-track delayed initiatives and reallocate resources where possible to ensure service delivery targets are met.”
He said the city has instituted a “war room” initiative led by the mayor.
“In this forum, service delivery departments are required to report regularly on the progress of their respective capital programmes and others.”
According to Mashigo, the political leadership provides oversight, ensuring accountability and alignment with strategic priorities.
“Importantly, this process operates in conjunction with the statutory oversight functions of the Section 79 Committees and the city’s council, which continues to hold the administration accountable for sound budget planning, disciplined execution, and prudent financial management. This layered oversight structure mitigates the risk of undue political interference.”
Mashigo said the metro has adopted an approved service delivery budgetary implementation plan that outlines clear performance targets for each department.
“This plan is supported by a funding plan aimed at ensuring financial viability, achieving strategic financial objectives, and strengthening the city’s liquidity position. By enhancing revenue collection and optimising expenditure, the city can sustainably deliver essential services to communities, thereby restoring public trust and reinforcing confidence in its financial stability.”
He denied that the debt relief programme has fostered a culture of non-payment, saying on the contrary, it has provided much-needed financial reprieve to residents across the city, enabling them to settle arrears and remain in good standing.
