Dada Morero was elected as City of Joburg Mayor in August 2024 for the second time.
Business Leadership South Africa CEO Busisiwe Mavuso says Johannesburg’s financial woes have been years in the making and cannot be attributed solely to the current administration. Nevertheless, she maintains that the city’s financial and operational situation deteriorated further under Mayor Dada Morero’s leadership.
“I think it would be disingenuous to actually place the problems of the city of Joburg on this current administration,” she said. “That doesn’t mean in any way that we are absolving this current administration. I think things have definitely gotten worse under Mayor Dada Morero.”
Morero was elected as mayor in August 2024 for the second time. He was first elected mayor in 2022.
During an interview with Newzroom Afrika, Mavuso urged the government to step in and tackle Johannesburg’s deepening financial and governance challenges, cautioning that the municipality’s failure could weaken the country’s economy.
This follows her statement outlining that business confidence is recovering and the country’s first sovereign credit rating upgrade in twenty years signals genuine momentum. But, sustaining and accelerating that momentum requires Johannesburg to function.
The importance of Joburg
Highlighting Johannesburg’s economic significance, Mavuso pointed out that Sandton is widely recognised as Africa’s richest square mile, demonstrating the city’s importance as a key economic hub.
“The contribution of Joburg to the national GDP is 16%, 70% of the country’s head offices sit in Joburg. So that just tells you how important the city is,” she said.
“A lot of people that are employed in the country are employed in the city of Joburg. So if this municipality collapses, the entire economy is going to be weakened.”
Business sector has to speak up
Mavuso said she thinks it is time for the business sector to speak up about the challenges visible within the City, especially around governance concerns that have been raised.
“I really think now that it’s becoming irresponsible, at least from where we see it as business, it’s becoming irresponsible for business to continue to keep quiet, especially around all the governance, you know, concerns that have been raised.”
Mavuso argued that Johannesburg’s crisis has reached a point of no return, citing concerns raised by the Auditor-General about the city’s finances as a clear indication of the problem’s depth.
“When Johannesburg is in a state of visible decline, it undermines the national growth story at precisely the moment a more positive narrative is gaining credibility. This is not a local political problem. It is a national economic emergency.”
Is there money to pay Eskom?
Mavuso also expressed concern over the deadline imposed by Eskom for the municipality to settle its outstanding debt, warning that failure to pay could result in consequences that would bring the City to a standstill.
“Eskom has said, if you are not going to pay us on the 8th of July, which is almost a month from now, we are going to cut power to the city of Joburg.
“I mean, just imagine how many factories, how many companies, how many residents are actually going to be impacted if indeed, Eskom goes ahead and cuts power to the city of Joburg.”
Is there money for wage increases?
She raised the issue of City of Joburg promising workers wage increases while the municipality does not have the money. But the leadership at the City insists the money is there, as business continues as usual.
“So I think it has gotten to that stage where there’s so many alarm bells that have actually been sounded of caution,” said Mavuso. “And it seems as if the city is continuing as if it’s business as usual, and it is not.”
In her statement released last week, she outlined that “capital expenditure has collapsed to 6% of the City’s budget. Maintenance spending stands at 0.5% of asset value, roughly one-eighteenth of the metro average. Rates and service charges have increased by 124% in real terms over the past fifteen years, while service quality has deteriorated sharply”
Service delivery deteriorates
Mavuso highlighted that the issue of service delivery has been ongoing and is not due to a lack of financial resources. “Corruption, criminality and maladministration appear to be increasingly entrenched within elements of the City,” she said.
“The Auditor-General estimates annual losses of approximately R12 billion through unauthorised and irregular expenditure. Property values have fallen materially. This has made our residents and businesses poorer and reduces confidence in the City’s future.
“Johannesburg’s fiscal and governance crisis has been building for years. It is not a new or partisan issue, and the failures of the past decade have occurred under successive administrations and shifting coalition arrangements. What is new is the severity and urgency of the situation
“The situation is serious, and it is the result of accumulated failures, not of a single administration.”
10 mayors in 10 years
Mavuso emphasised that “fragile and unstable” coalitions have produced ten mayors in ten years, making coherent long-term governance virtually impossible.
The instability is both historical and ongoing: in the past few months alone, three motions of no confidence have been filed against the current mayor by a party that is itself part of the governing coalition.
“This is not about which political party governs the City, it is about how it is governed,” she said.
She touched on the billing problem that persisted even when the DA was leading the City.
“I think that (referring to the billing problem) is one of the things that Herman Mashaba tried to actually intervene in and tried to sort out.”
Addressed to all poltical parties
Mavuso added that when it comes to the state of City of Joburg, she is calling on all political parties, the President, the GNU, residents and businesses to do what is right.
“We are setting out, publicly and specifically, what we believe functional governance in Johannesburg must deliver: capital infrastructure that is adequately funded and maintained; irregular and wasteful expenditure that is eliminated; service delivery measured against clear indicators and reported on transparently; leadership held accountable for outcomes; and consequence management applied consistently and without exception,” she said.
BLSA requests
“We are therefore asking for the following short-term commitments, from all parties with the authority and responsibility to act:
“From the current City administration: immediate stabilisation of the City’s finances, transparent reporting against clear service delivery indicators, and credible consequence management for corruption and irregular expenditure – starting now, not after the election.
“From all parties contesting the elections: specific, costed commitments on how they will address the City’s fiscal crisis, restore infrastructure, and re-establish functional governance – not broad promises, but plans that can be held to account.
“From the President and national government: active use of the powers available to national and provincial government to support the structural and financial reforms that city-level leadership alone cannot deliver, and consistent enforcement of consequence management where governance standards are not met.”
What business commits to doing
Mavuso noted that Business is the city’s largest ratepayer.
“Commercial properties represent 26.5% of property values yet contribute 55.4% of property rates revenue,” she said. “That gives us both a direct financial stake in the city’s recovery and a direct responsibility to act.”
“Business leaders are already engaged: funding support to government departments working on local government reform; contributing to infrastructure repair including potholes, traffic signals, and inner-city maintenance; and partnering with government and civil society organisations to address local problems.
“These efforts are real but fragmented. We want to systematise, coordinate and scale them.”