Eugene Modise rejects payroll crisis claims in Tshwane ahead of elections

The City of Tshwane’s Deputy Executive Mayor and MMC for Finance, Cllr Eugene Modise, has dismissed opposition claims that the metro was at risk of failing to pay employee salaries, calling the allegations “categorically false” and politically motivated ahead of the November 4, 2026 local government elections.

Modise rejects ‘misleading narrative’

Modise said the City was compelled to respond to what he described as a “misleading narrative” suggesting Tshwane was either unable, or at risk of being unable, to meet its payroll obligations. He said the claims formed part of a broader attempt to discredit financial progress made under the current Multi-Party Coalition Government.

“At no stage was the City unable, or likely to be unable, to meet its payroll obligations,” Modise said.

He explained that employee salaries are planned in advance through established treasury management processes and said that after salaries were paid the City still maintained a positive bank balance of approximately R1.8 billion, a figure he presented to directly contradict claims that Tshwane had “come dangerously close to not making payroll.”

Revenue figures and budget status

Modise also rejected assertions that the metro was facing a major revenue shortfall. He said that by June 26, 2026, while revenue collection for the month was still ongoing, the City had already collected more than R3.6 billion, exceeding the monthly target set out in its funded budget.

On a year-to-date basis, Modise said Tshwane had collected approximately 98% of the revenue projected in its Budget Funding Plan and that the figures were broadly consistent with the previous financial year’s performance. He said these figures “bear no resemblance whatsoever to the fictitious R3 billion shortfall claimed by the opposition.”

Recent financial actions

To support his position, Modise pointed to several recent financial achievements:

• The City repaid a R1 billion bullet loan when it fell due in June.
• Tshwane remains fully compliant with its Eskom debt repayment agreement.
• National Treasury awarded Tshwane an additional R300 million after recognising improvements in the City’s capital expenditure performance.

Modise said the metro’s 2026/27 budget had been assessed by National Treasury and classified as funded in accordance with the Municipal Finance Management Act. He contrasted this with the previous DA-led administration, which he said failed to secure a funded budget for four consecutive years.

Ongoing disputes and criticisms

The exchange follows a long-running wage dispute that has influenced debate over Tshwane’s finances. The metro spent several years in litigation after the previous DA administration sought exemption from implementing a negotiated 3.5% salary increase agreed to in 2021. The Local Government Bargaining Council ultimately ruled against the City.

Following further negotiations, the current ANC-ActionSA-EFF coalition government under Mayor Nasiphi Moya reached an agreement in February 2026 to settle the resulting R1.088 billion backpay liability through phased payments extending to 2029, with lower-income employees receiving priority. The settlement has remained a focal point of opposition criticism.

Opposition parties have also raised other concerns: in January the DA alleged that the City had diverted hundreds of millions of rand from departmental budgets to fund the wage settlement, a claim the Mayor’s Office rejected as exaggerated and deliberately misleading. In May, the Freedom Front Plus argued that Tshwane’s 2026/27 budget relied on overly optimistic revenue projections and noted that the City’s wage bill would exceed R16.26 billion, representing almost 29% of the R55.7 billion operating budget, while questioning the administration’s projected 90% revenue collection rate.

Governance scrutiny

Modise has faced scrutiny over governance issues. In May, the Tshwane council sanctioned him by docking two months’ salary after a forensic investigation allegedly found he had failed to declare a financial interest in a security company that held a municipal contract; opposition parties argued the penalty was too lenient.

Modise’s closing warning

Modise said the opposition is entitled to scrutinise the City’s finances but warned against misrepresentation. He cautioned that “deliberately distorting financial information” risked creating unnecessary panic among municipal employees, residents, businesses and investors, adding that “Public confidence in the Capital City’s finances should never become collateral damage in an election campaign.”