Auditor-general Tsakani Maluleke has warned that SA’s municipal oversight is failing, with persistent governance breakdowns eroding public trust and undermining constitutional accountability.
At a public dialogue hosted by the Centre for Development and Enterprise (CDE), Maluleke described a pattern of systemic noncompliance and institutional weakness across local government despite repeated statutory interventions.
Maluleke confirmed only one of SA’s eight metropolitan municipalities — the City of Cape Town — achieved a clean audit in the most recent reporting cycle.
The City of Johannesburg, by contrast, was unable to prepare credible financial statements, a failure she attributed to “a lack of key controls” and “tremendous leakage in financial management”.
According to the auditor-general’s consolidated findings, four metros received qualified audits, and three were issued unqualified opinions with significant compliance concerns. “We have not yet built municipalities into institutions that are strong and capable of doing what they are supposed to do,” she said.
The mandate of the auditor-general of SA (AGSA), derived from chapter 9 of the constitution and operationalised through the Public Audit Act, requires annual audits of all public institutions, including assessments of financial statements, performance reports and internal controls.
Maluleke said SA was one of few jurisdictions globally where such comprehensive auditing is constitutionally entrenched.
The World Bank has rated the AGSA as one of only two supreme audit institutions worldwide that are “fully independent”.
Despite this institutional strength, Maluleke acknowledged that the AGSA’s powers were limited to auditing, reporting and recommending remedial action.
While recent amendments to the Public Audit Act have enabled the office to flag material irregularities and refer cases to law enforcement, the AGSA cannot prosecute or dismiss officials. “Our powers complement those of existing agencies,” she said, citing the public protector, the Hawks and the Special Investigating Unit. “But we need to collaborate more effectively so that matters are taken forward.”
The conversation underscored a broader failure of the accountability ecosystem. Maluleke criticised municipal councils, mayors and speakers for routinely approving unfunded budgets and failing to act on audit findings.
She also pointed to the department of co-operative governance & traditional affairs and provincial executives, mandated to review municipal performance plans under the Municipal Systems Act and the Intergovernmental Relations Framework Act. “They frequently fail to do that,” she said. “Instead, they tick a box and say, ‘we have seen the plan’.”
The auditor-general’s appeal to the speaker of the National Assembly earlier this year reflects growing frustration with noncompliance. In terms of parliamentary procedure, the AGSA is required to notify the speaker when municipalities fail to submit financial statements within the legislated time frame.
Maluleke confirmed that she had requested the speaker to refer such cases to the relevant portfolio committees for oversight. “We must never tolerate that,” she said. “The very least you can do is submit a set of financial statements.”
On the legislative front, Maluleke welcomed the passage of the Public Procurement Act in 2024, which aims to tighten controls and improve transparency in state contracting. However, she cautioned that without ethical leadership and institutional discipline, the law may have limited impact.
“It doesn’t matter how good a piece of legislation is,” she said. “For as long as people flout the rules and get away with it, it is an exercise in futility.”
She said: “We keep spiralling instead of regularly correcting.”
Her office has recovered R4.5bn over five years through flagged material irregularities, but she conceded that this represents only a fraction of the problem.
“Some public officials make it their business to do their jobs well,” she said, citing Midvaal’s decade-long record of clean audits. “That’s what you want in every public institution.”
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