The metro is hailing what it describes as a ‘turning point’ in its efforts to stabilise its financial governance, but the DA argues that the celebration is premature.

While the latest Auditor-General (AG) report for the 2024/25 financial year shows a notable decline in audit qualification areas, the DA insists that crippling water and electricity losses reveal a city still buckling under deep financial strain.

Deputy Mayor and MMC for Finance, Eugene Modise, announced on Tuesday that the city had made ‘clear and measurable improvements’ in its audit performance.

Although the metro once again received a qualified audit opinion, Modise emphasised that the number of qualification areas dropped from six in 2023/24 to just two in the latest report.

“This marks meaningful progress and confirms that the interventions introduced through the Audit Outcome Remedial Action Plan are beginning to strengthen the city’s financial governance,” Modise said.

He explained that the improvement is part of a slow climb from audits that previously painted a bleak picture.

“In 2021/22, the city received an adverse audit opinion that was the worst possible outcome, signalling systemic breakdowns in financial management.”

He said the following year saw a marginal improvement to a qualified opinion, though with a staggering 13 qualification areas.

“These outcomes demonstrated the extent of the institutional failures that the administration inherited and the scale of the work required to restore stability,” he explained.

According to Modise, the current report shows a city attempting to regain its financial footing.

Municipal entities also recorded positive developments; Housing Company Tshwane (HCT) secured an unqualified audit opinion, improving from the previous year, while the Tshwane Economic Development Agency (TEDA) sustained its unqualified status.

Modise said the results reflect better co-ordination, improved internal controls and more efficient audit preparations across departments and entities.

He credited the Audit Steering Committee and the Executive Audit Tracking Committee for driving better compliance, timely submission of supporting documents and improved quality of working papers.

“The improvements reflected in this audit demonstrate a city that is rebuilding its financial foundations,” Modise said.

“Tshwane is moving in the right direction.”

Modise acknowledged that the metro still has significant work ahead.

He said the two remaining qualification areas must be resolved urgently, and the city remains committed to strengthening internal controls and ensuring better legislative compliance across departments.

“The work is far from complete,” he said.

“Our objective remains to move the city out of qualified audit status and restore financial credibility in a sustainable and transparent manner.”

The consolidated audit report is expected to be tabled in Council in January, where councillors will debate the final findings and their implications for the 2025/26 budget cycle.

However, the DA has poured cold water on the metro’s optimism, saying the progress is overshadowed by poor financial control and alarming losses in critical services.

The DA Tshwane spokesperson for Finances, Jacqui Uys, said early indications from the AG suggested that the metro had failed to adequately address Unauthorised, Irregular, Fruitless, and Wasteful Expenditure (UIFW).

She said the audit still points to weak consequence management, slow financial recovery of losses and unsatisfactory accountability.

“The city has again failed to achieve an unqualified audit, and early reports support our concerns that UIFW and accountability remain major challenges,” Uys said.

However, it is the scale of service losses that has triggered the greatest concern.

According to early audit figures cited by the DA, the metro lost an estimated R1.7-billion in water purchased from Rand Water, primarily because of delayed leak repairs.

Uys added that the metro registered R1.87-billion in electricity losses, much of which stems from theft, illegal connections and infrastructure decay.

“These staggering losses show a city that is far from financially stable,” Uys said.

“The money lost could have gone toward improving service delivery, repairing infrastructure and stabilising the city’s financial position.”

The DA argues that the administration’s failure to clear only four of the six outstanding qualification areas shows a slowdown in momentum compared to the previous year, when the DA-led government, under former mayor Cilliers Brink, had resolved six out of 13 areas.

Uys said this regression is troubling, particularly given the metro’s existing service delivery challenges, including ongoing water outages, electrical failures, rising tariffs and deteriorating infrastructure across many suburbs.

“While the city claims progress, residents continue to bear the brunt of financial mismanagement,” she said.

“The reality is that water is leaking out of the system faster than it can be repaired, and electricity theft is costing the city billions. This is not sustainable.”

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