6 Eastern Cape Municipalities Under Pressure After National Treasury Cuts Funding

• National Treasury withdrew equitable share funding from six Eastern Cape municipalities over serious financial mismanagement concerns
• EC COGTA MEC Zolile Williams confirmed the findings were legitimate and warned the cuts could affect salary payments and service delivery
• Williams flagged evergreen contracts at Buffalo City Metro and Nelson Mandela Metro as key problems his department is now actively addressing

EASTERN CAPE — National Treasury has pulled equitable share funding from six municipalities in the Eastern Cape, citing evidence of financial mismanagement. The announcement has raised alarm over the potential knock-on effects for residents who depend on those municipalities for basic services.

Eastern Cape MEC for Cooperative Governance and Traditional Affairs (COGTA), Zolile Williams, addressed the matter in an interview with SABC News on 8 July 2026, confirming that the Treasury's findings were both legitimate and the direct responsibility of the affected municipalities.

Williams acknowledged the serious consequences of losing equitable share allocations, which cover municipal operations and basic service delivery.

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"Not receiving your equitable share has a negative impact in that it may affect the payment of salaries, it may also negatively impact the actual operations of the municipality in the form of service delivery," he said.

Williams discusses municipalities in the red

He also confirmed that several of the flagged municipalities were operating on unfunded budgets and owed Eskom close to a billion rands each.

Beyond irregular and wasteful expenditure, Williams singled out so-called evergreen contracts as a persistent problem, particularly at Buffalo City Metro and Nelson Mandela Bay Metro. These are contracts that renew automatically without being subjected to fresh procurement processes.

"We are there, fortunately, in these two municipalities. At least now, we have been able to record who has been appointed for these long years in these evergreen contracts, and we're bringing a stop to all of them," Williams said.

Provincial COGTA and Provincial Treasury are working alongside the affected municipalities to clear irregular expenditure, though Williams conceded that some municipalities have continued to resist corrective measures.

View Williams' interview on X here:

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In a related article, Briefly News reported on the Public Protector's findings against Cape Town, which revealed significant deficiencies in service delivery to township residents. The report underscores severe health and safety risks posed by crumbling infrastructure in areas like Langa Flats and Khayelitsha, compelling local authorities to take immediate action.

Source: Briefly News