Johannesburg on the brink of financial collapse, says DA

The DA in Johannesburg has warned that the city’s financial woes will worsen, having noted with serious concern the city’s downgrade from A+ to A by credit ratings agency GCR Ratings.

DA caucus leader Belinda Echeozonjoku said the implications of this downgrade cannot be underestimated.

“A city with an infrastructure backlog in the hundreds of millions will undoubtedly require loans to ensure continued service delivery. The downgrade means that it becomes very difficult for the city to get and repay loans,” she said.

Echeozonjoku said the current executive had made another funding model for the metro more difficult to come by.

“The DA has consistently raised concern over the lack of good governance in the City of Johannesburg under the ANC-EFF-PA coalition, especially with the lack of oversight by the executive in the running of the city,” she said.

The caucus leader said current mayor Kabelo Gwamanda was an “ANC puppet” that seemed oblivious to what was happening in the city.

“The ANC-EFF and PA are pulling him in different directions,” she said.

The party said it wrote to city manager Floyd Brink requesting a full a full forensic investigation into all activities of the Johannesburg Property Company, and it was clear from his response that, despite him being able to take action, he was unwilling to.

“It is also evident that the MMC of finance is not in touch with the city’s financial state. A Cogta oversight engagement revealed that the city’s unauthorised, irregular, fruitless and wasteful expenditure has increased by 44%, all this while the city has an unfunded budget,” she said.

Echeozonjoku said under the previous DA-led government, the budgeting process had been a box-ticking exercise, citing that they embarked on a rebasing exercise to reduce the budget to at least R59bn, then proposed a zero rate increase to get the city back on track.

However, she said all these decisions and actions were reversed when the ANC-EFF-PA coalition came into power.

“The DA will continue to monitor the governance in Johannesburg, while all DA members on section 79 committees will be interrogating every detail of what happens in their respective portfolios.

“We cannot sit by and watch the ANC-EFF-PA coalition flush our once-beautiful city down the drain.”

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