The city of Johannesburg on a tight deadline to approve budget

After two attempts of trying to adopt a budget, especially before the start of the new financial year - 1 July, the Gauteng Executive Council (Exco) convened an extraordinary Executive Council meeting on Saturday to determine what should happen with the City of Johannesburg (COJ) if council failure to approve a budget for the 2020/2021 financial year. 

“The failure to pass a municipal budget will have grave implications not only for the City of Johannesburg (COJ) but more importantly, for the residents of the city,” Exco said in a statement on Monday.

Exco intervened and acted in terms of section 139(4) of the Constitution of the Republic of South Africa Act No. 108 of 1996, which states that if a municipality cannot or does not fulfil an obligation to approve, the provincial executive must intervene by “taking any appropriate steps to ensure that the budget or those revenue-raising measures are approved, including dissolving the Municipal Council”. 

Exco, in their directives, stated that in the circumstances, that council must “convene urgently to approve its budget for the 2020/2021 municipal financial year, by no later than 10 July 2020”. Furthermore, until the budget is approved, MEC for Finance, Nomantu Nkomo-Ralehoko, will be responsible for approving expenditure incurred by the COJ.

Sipho Masigo, the spokesperson for the City of Johannesburg’s Speaker of Council Nonceba Molwele, told Daily Maverick that council would sit on Thursday. 

This came after the city failed twice last week to adopt the budget for a number of reasons that included legal and consultative considerations. This led to MEC for Human Settlements, Urban Planning and Cogta, Lebogang Maile raising his concerns on Friday, 3 July. 

“Johannesburg is South Africa’s economic hub and the city with the biggest budget. The failure to pass the budget means that the municipality can’t spend any monies until such time that it has approved the budget. This will undoubtedly have grave implications not only for the municipality but more importantly, for the residents of the city,” Maile’s statement read.

MMC for finance, Jolidee Matongo, was first meant to present the metro’s budget on 30 June, 2020, but the extraordinary council sitting was postponed to Thursday 2 July. 

The postponement of the sitting came from the city’s mayor, Geoffery Makhubo who requested that the extraordinary council sitting be moved a day after the official budget year had already begun.

“As the government of local unity we wish to assure residents of our most genuine commitment to delivering services and extending support to the vulnerable and affected during this difficult period exacerbated by the Covid-19 pandemic,” Makhubo said on 30 June.

However, in the early hours of Thursday morning 2 July, COJ issued a statement saying that the sitting was cancelled until further notice.

“This decision is based on legal advice received on the peculiar circumstances that confront the Council,” said City of Johannesburg Speaker of Council, Councillor Nonceba Molwele, in a statement on Thursday. Maile said in Exco’s statement on Monday that he expects the municipality to comply with the directives as he believes all political parties in Council should “put the interest of the residents of the city first”.  

Mlimandlela Ndamase, the mayor’s spokesperson, told Daily Maverick that the mayor’s office accepts and welcomes the directives given by Exco.

“The city will endeavour to satisfy all its obligations and the Executive Mayor remains confident that a budget will be passed within the timelines set and that the work of servicing the residents of Johannesburg and responding to the needs of the most vulnerable and poor will continue,” Ndamase said. DM