Johannesburg is not in a financial crisis, despite returning to council to request approval of a report to access a R2bn short-term loan, says mayor Mpho Phalatse.
However, it is experiencing “cash flow mismatches” and requires intervention to “ensure services are delivered, officials on the front line receive their salaries and service providers are paid on time,” the mayor said.
“The auditor-general found many South African municipalities faced financial difficulties and irregular expenditure had reached an untenable level. The struggle to attract loan funding was not isolated to Johannesburg. “Despite the claims doing the rounds, the city is in a position to honour its loan repayments,” Phalatse said.
“Taking out a short-term loan is a normal business practice employed by the City of Johannesburg, as was the case during the budgeting processes during the 2015/16, 2016/17 and 2018/19 financial years,” said the mayor.
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