Hlabisa tells Parliament 38 municipalities need support as 37 stay under intervention
Seven of the distressed councils improved their audit outcomes in 2024/25, but 28 stood still and two went backwards.
Thirty eight municipalities are receiving structured support from national government and thirty seven remain under constitutional intervention, Co-operative Governance and Traditional Affairs Minister Velenkosini Hlabisa told Parliament.
As IOL reported on 18 September, Hlabisa was answering questions from IFP MP Alco Ngobese about how many councils are in distress and what his department is doing about it. His answer, given in the National Assembly, put the number of distressed municipalities at 38 as at August, identified on governance, financial, institutional and service delivery grounds.
What the numbers mean
The 38 are on the department’s books as distressed. The 37 are something different and more serious. They are under section 139 of the Constitution, the provision that allows a provincial executive to take over part of a municipality’s functions when it cannot meet an executive obligation. A section 139 intervention is the heaviest instrument available to the state short of dissolving a council.
The two lists overlap but are not the same. The 38 are being supported through the Municipal Performance Turnaround Strategy and related section 154 measures, which is the softer, cooperative route. The 37 are under intervention, which is the harder one.
Hlabisa did not name the 38. He did name the provinces carrying the 37. The Western Cape has four, being Beaufort West, Kannaland, Garden Route and Theewaterskloof. KwaZulu-Natal has one, Impendle. Gauteng has two, Emfuleni and Merafong. The Free State has eight, including Mangaung. The Eastern Cape has five, Limpopo one, Mpumalanga five, North West eight, and the Northern Cape three.
The audit picture
Seven of the 38 recorded improvements in their audit outcomes during the 2024/25 cycle. Twenty eight stayed where they were. Two went backwards. Thirty five of the 38 have adopted Municipal Support and Improvement Plans or Financial Recovery Plans, the documents that are supposed to guide the turnaround.
Hlabisa said spending on the Municipal Infrastructure Grant had improved in a number of the distressed municipalities, and singled out Enoch Mgijima Local Municipality in the Eastern Cape for revenue gains linked to infrastructure and metering work. Metering is the unglamorous part of municipal finance. A working meter is the difference between a council that can bill and one that cannot, and a council that cannot bill cannot pay for water, roads or refuse collection.
“Certain municipalities have demonstrated improvements in governance stability, implementation of recovery plans and municipal operations,” Hlabisa said. “However, the Department recognises that progress remains uneven.”
The appointments problem
The minister also put a figure on a problem that does not always make the news. Twenty five municipalities across all provinces have reported non-compliant senior management appointments, with varying frequency per municipality. Thirty five such appointments were made during the 2024/25 and 2025/26 financial years. Thirty four were dealt with through corrective measures under the applicable legislation. One was declared invalid and set aside by a court.
A senior manager appointed outside the rules is not a technicality. The Municipal Systems Act sets qualification and process requirements for these posts for a reason. A council that hires the wrong person at the top pays for it in the budget, in the audit, and eventually in the service the resident receives.
What happens next
Hlabisa said the department will keep monitoring the effectiveness of support and intervention alongside provincial governments and National Treasury, and will use the constitutional and legislative mechanisms available where municipalities fail to achieve sustainable improvement.
That is the commitment. The measure of it will be the next audit cycle, and whether the seven councils that improved are joined by more of the 28 that stood still.
Source: IOL, Thirty-eight municipalities classified as distressed, Hlabisa tells Parliament.
