Gauteng MEC for Finance Nkululeko Dunga has hit the ground running, painting a grim picture of the province’s finances to residents on Thursday.
Dunga was appointed to the position on 1 April and says that since then, he has engaged with officials of the Gauteng Provincial Treasury, municipalities, and other stakeholders to gain a comprehensive understanding of the province’s finances.
As of 31 March 2026, Gauteng municipalities collectively reported outstanding debts of approximately R173 billion. About 87% of this debt is more than 90 days past due and is largely held by households. According to Dunga’s predecessor, Lebogang Maile, in a February briefing, councillors and municipal officials across Gauteng also contribute to this debt, owing their own municipalities a combined R165.7 million in unpaid accounts.
As a result, municipalities are struggling to pay their own debts, with Dunga saying they owe creditors about R34.3 billion. However, the figure is likely far higher due to the underreporting of debt owed to Eskom and Rand Water.
According to Dunga, municipalities collectively underreported debt owed to Eskom by R12.5 billion and debt owed to Rand Water by R2.7 billion.
“We found several municipalities facing serious financial distress, deteriorating governance and persistent breaches of financial obligations, particularly Mfuleni, Sedibeng, Lesedi and Merafong.”
Overexpenditure
Gauteng departments continue to struggle to fully utilise conditional grants, while communities require schools and libraries, roads and clinics, sports facilities and agricultural support programmes.
These include the Department of Agriculture and Rural Development, which spent 77% of its conditional grants, while sports, arts and culture and recreation spent 93%, with infrastructure expenditure in some programmes as low as 46%.
“These are not simply technical compliance failures. They represent missed developmental opportunities in communities that desperately require public investment, economic support and functioning public infrastructure.”
Irregular expenditure remains a challenge in Gauteng.
“While the government accepts that irregular expenditure does not automatically mean money was stolen or services were not delivered, the scale and the recurrence of these findings reflect serious and systematic weaknesses in procurement management, contract administration, compliance monitoring and consequence management across the provincial administration,” said Dunga.
About R36.5 billion of historic irregular expenditure remains unresolved and not fully addressed. The largest balances are concentrated in health at R22.8 billion, education at R5.9 billion, and human settlements at R4.1 billion.
“This situation cannot continue indefinitely. Without decisive interventions, there must be immediate strengthening of financial controls, consequence management and institutional accountability across departments and entities where officials have acted negligently, recklessly or in violation of procurement prescriptions.”
Dunga has called for consequence management and disciplinary action against those found liable.
“Heads must roll where it is necessary. The province cannot continue to normalise expired contracts, procurement deviations and failures in contract management while communities continue to suffer from inadequate infrastructure and deteriorating public services.”
Gauteng businesses suffer
Unpaid invoices and unrecognised expenditure commitments across provincial governments and entities remain rife. At the end of March 2026, these stood at R9.3 billion, with about R4.9 billion already exceeding the 30-day payment period
“The reality is that some departments have effectively normalised operating beyond their financial capacity through over-commitments and delayed invoice processing, poor contract management and weak expenditure controls,” said Dunga.
This is the same province that struggles with revenue collection. According to Dunga, the province had a projected target of R8.41 billion for the 2025/26 financial year. However, as of the end of March 2026, the province had collected R7.08 billion.
The largest under-collections were recorded in roads and transport, economic development, the gauteng provincial treasury and health.
“While public healthcare remains a constitutional obligation of the state, there are already existing revenue obligations and billable accounts within the system that must be properly managed and recovered where appropriate in order to strengthen the financial sustainability of the healthcare system.
“This matter will require broader engagement within the national Department of Health and the Department of International Relations and Cooperation, particularly regarding patients from neighbouring countries whose healthcare obligations remain difficult to recover under the current framework.”
