Auditor‑General warns all eight metros failed to secure clean audits ahead of elections

South Africa’s eight metropolitan municipalities all failed to achieve clean audits for 2024-25, Auditor‑General Tsakani Maluleke warned, in a report she described as a warning to political parties and voters ahead of the local government elections.

Who, what and why it matters

Maluleke said the eight metros which account for more than half of local government spending and serve nearly 25 million people did not secure clean audit outcomes for 2024-25. She described a governance landscape weakened by poor oversight, weak leadership and a collapsing accountability ecosystem, and urged urgent reform as the next local government administration prepares to take office.

Service delivery and financial losses

The report highlights substantial service delivery losses in the metros: water losses totalled R9.89 billion and electricity losses amounted to R17.28 billion. The metros also faced high levels of consumer debt that was written off or impaired, reaching R39.33 billion.

Accountability, consequences and recommendations

Maluleke called for decisive action to professionalise local government, strengthen oversight structures, improve skills retention and enforce consequences for misconduct. She urged political parties to prioritise capable and ethical candidates for municipal councils and mayoral positions, warning that “the calibre and capability of the elected leaders will determine the success of the seventh administration.”

National picture and wider municipal distress

Across local government, only 39 of 257 municipalities (15%) achieved clean audits. Maluleke reported that billions continue to be lost through financial mismanagement, irregular expenditure, infrastructure failures and poor governance, and said progress has been “limited.”

Her audit found that 195 municipalities (76%) submitted financial statements containing material misstatements. Without corrections made during the audit process, only 24% would have qualified for unqualified audit opinions, compared with the 61% that ultimately achieved that status.

Financial fragility and consultant reliance

Maluleke flagged severe financial distress among municipalities: 62 were in severe financial distress, more than half lacked sufficient current assets to cover liabilities, and at year‑end 174 municipalities did not have enough cash to pay creditors. A total of 123 municipalities could not cover what they owed.

She also warned about growing dependence on financial reporting consultants: 225 municipalities spent R1.61 billion on consultants in 2024-25, yet 61% of municipalities using consultants still submitted financial statements with material errors.

Irregular expenditure and procurement failures

Since 2021-22, municipalities have accumulated R145.21 billion in irregular expenditure. Auditors reviewed 10,830 contract awards worth R65.12 billion and found widespread non‑compliance with procurement and contract management legislation: 216 municipalities (85% of those reviewed) failed to comply.

Maluleke said municipalities jointly wrote off R62.12 billion in unrecoverable debt during the year. She warned that continued procurement failures expose municipalities to fraud and corruption risks and contribute to deteriorating service delivery and infrastructure.

What the AG wants ahead of elections

In urging urgent reform, Maluleke emphasised the need for strengthened oversight, improved skills retention, professionalisation of local government and consequences for misconduct. Her findings are presented as a direct caution to political parties and voters ahead of the November local government elections.

As Maluleke concluded, limited progress to date means residents and businesses continue to face poor service delivery, environmental hazards and failing infrastructure issues she linked to persistent accountability failures at multiple levels.