Transcript: Budget Speech

Notice of meeting and opening

00:00:05Good morning everyone. It is hereby notified that the 37th ordinary meeting which is the budget speech of the City of Johannesburg municipality will be held on Wednesday the 27th of May 2026 at 12:30, followed by the budget speech debate and consideration of reports on Thursday which is the 28th of May 2026 at 10:00 AM at the Constance Connie Bapela Council Chamber, the Metropolitan Centre in Braamfontein. We starting off with the opening and acknowledgement by the speaker.

Cllr Kunene raises private security parking complaint

00:00:39Councillor Kunene, I saw your hand. Was it a point of order on the STC?

00:00:45No, no, no, Madam Speaker. I just wanted to address you on a matter that I think you need to follow up. Myself and MMC Mabaso have got private security over and above the single security protection that we have. Every time we come with our private security, we are told that they have to park outside.

00:01:07But a civilian, a civilian, Helen Zille, a civilian, private security is allowed to come inside our premises. They must go out, Madam Speaker. You need to deal with that. Helen Zille is a civilian. She's a civilian. She's nobody.

00:01:20Thank you. Thank you, Councillor.emotive

00:01:24She's nobody in the bigger scheme of things.emotive

00:01:26Thank you, MMC.emotive

00:01:27She's no one. She's nothing in the bigger scheme of things. Thank you very much. And this thing of her, and this thing of her accessing our buildings here, it needs to be dealt with. She's, she's nothing in the bigger scheme of things. Thank you very much.emotive

00:01:43Colleagues, Councillor Da Rocha, Councillor Da Rocha, would you want me to remove you? Thank you. Can we stop, please? I've allowed the councillor to speak. Colleagues,

00:02:07Councillor Avant-Smith, are you responding to what the MMC has said? Because I'm going to rule on it. I don't need a response. I want to rule on it. I don't need a response. Councillors, I will, I will deal with the issue, MMC and all other councillors. I will deal with the issue. I know yourself and MMC Mabaso has private security because of the threats,

Welcome and acknowledgement of guests

00:02:39but I will deal with it as per the council. Councillor Avant, I've ruled on this. I don't think we need to have a debate on this. Yeah, please write to me. Thank you. Colleagues, colleagues, all of us, we need to get the debate by 12:30, and it's 12:31. Executive Mayor of the City of Johannesburg, Councillor Sello Dada Morero in absentia;

00:03:10Deputy Executive Mayor, who's also the MMC of Finance, Councillor Loyiso Masuku; the Whip of Council, Councillor Kazamula Chauke; Chair of Chairs, Councillor Vuhani Marema; all political party leaders and whips; members of the mayoral committee; chairpersons of section 79 committees; fellow councillors;

00:03:38the City Manager, Dr. Floyd Brink; Secretary to Council, Mr. Andile Gobinca; officials of the City of Johannesburg; most importantly, residents of the City of Johannesburg; members of the media present, ladies and gentlemen, I welcome you all to the 37th Ordinary Council Meeting of the City of Johannesburg Municipality. But also, councillors, please join me to further acknowledge the following guests:

00:04:12Honourable Panyaza Lesufi, who is the Gauteng Premier; Honourable Bandile Masuku, Gauteng MPL; Mr. Sasabona Manganye, the PMC Chairperson; Mr. E.M. Pillay, Florenza Lightning; Mr. Kumar Murugan, Philips SA;

00:04:35uNdabezitha Khumalo and his delegation, AmaTungwa Royal Kingdom; leaders of all political parties represented in the chamber; junior councillors, Junior Student Council, you are all welcome to the sitting of our budget. I thank you.

Applications for leave of absence

00:05:06We now proceed with applications for leave of absence.

00:05:12Colleagues, we have the following leave of absence: Councillor R. Harris, a late arrival; Councillor N. Mnisi, family bereavement. We all know that the councillor has lost her mom. Are there any further apologies from political parties? Can I see hands? Well, the DA has two hands up. Councillor Masera?

00:05:44Good afternoon, Speaker and the colleagues. Thank you very much. Speaker, I've got the following LOAs for DA councillors: Councillor Maureen Mnisi, ill health; Councillor Andrew Stewart will leave early; Councillor Michael Crichton, party business; Councillor Mark Van Der Merwe is in court today; Councillor Sekhu Matsobane, party business; Councillor Lynda Shackleford, ill health;claim

00:06:11Lerato Mazibuko, party business; Mlungisi Ncube, party business; Councillor Obakeng Kamela, party business; Councillor Moloisane Boitumelo, private business; Councillor Florence Roberts, ill health; Councillor Gerry Ramaru, party business;

00:06:34Councillor Nyrin Pietersen, private business; Councillor Michael Crichton, party business; Councillor Stuart Marais, party business; Councillor Sean Kreusch, party business; Councillor Lerato Mphefo, ill health; and the following three councillors will leave at two, that is Councillor Tyrell Meyers, Councillor Faye Chame, and Councillor Rashieda Landis. Thank you so much, Speaker.

Request to acknowledge Helen Zille

00:07:04Councillor Sifumba, your hand was up.

00:07:08Thank you very much, Speaker. You acknowledged other leaders of other parties. May you kindly also acknowledge the presence of Helen Zille, who means something to us? Thank you.

00:07:19Ex, ex, ex,

00:07:21Councillor Sifumba, Councillor Sifumba, it works this way. When political parties have guests, they ask us to recognize the people that are in the gallery. Thank you so much. Councillor Zigebe?

00:07:43Good afternoon, Speaker. Councillor Gwamanda, party business. Thank you.

00:07:48Thank you so much. Councillor Makhuba?

00:07:53Thank you, Speaker. For the IFP, it's Councillor Nyembe, ill health.

00:07:59Thank you, Councillor. Councillor Mogape?

00:08:15If it's not working, use the other mic.

00:08:18Thank you, Speaker. Good day, councillors. From the EFF, it's MMC Koma, party business; Councillor Makhafola, party business; Ngwenya, ill health; Councillor Ramatsobane, party business; Councillor Seerane, private business; Councillor Mkasi, family commitment; Councillor Nhlapo, ill health. The following councillors request to leave at 1:30 if we are not finished, Speaker: Councillor Mogapi and Councillor Mbambala. Thank you.

00:08:48Thank you, Councillor. Councillor Ndlela?

00:08:52Thank you, Madam Speaker. On the ANC, we have Councillor Mothupi and Councillor Mgaga due to ill health. Thank you.

00:09:01Thank you so much. Councillor Simonse?

00:09:04Good afternoon, Madam Speaker. For the Patriotic Alliance, Councillor Kaldine, family bereavement; Councillor Ponsonby and Councillor May is running late. Thank you.

00:09:14Thank you, Ma'am. Are these apologies noted? Thank you so much.

Call to the budget speech and order in the chamber

00:09:23We now proceed to the budget speech.

00:09:44Deputy Executive Mayor, MMC Masuku, can you ascend to the podium to present the budget speech?

00:10:40isiZulu[singing] Asina valo.

00:10:45Before you, before you start, Deputy Executive Mayor, I would ask all the caucus leaders to ensure that your members are seated and that we have no disruption. And those caucus leaders that I've spoken to, you know exactly what I'm saying. So please. Thank you, Executive Deputy Mayor, MMC of Finance.

Budget speech: acknowledgements, city context and service backlogs

00:11:16Thank you very much, Madam Speaker. Executive Mayor, Councillor Dada Morero; the Premier of Gauteng, Mr. Panyaza Lesufi; MECs present and members of the provincial legislature, in particular the Chairperson of Community Safety, my husband, Dr. Bandile Masuku;

00:11:45members of the Mayoral Committee who I've had the pleasure to serve with in this term; leaders from SALGA; the Chair of Chairs, Councillor Adolph Marema; the Whip of Council, Kazamula Chauke; chairpersons of committee; fellow councillors; the Political Management Committee Chairperson of the ANC-led Government of Local Unity and Regional Secretary of the ANC, Comrade Sasabona Manganye;

00:12:20leaders of political parties; the City Manager, Dr. Floyd Brink; Group Chief Financial Officer, Mr. Tebogo Moraka; senior managers and officials of council; business leaders; members of the media; residents of Johannesburg; comrades and compatriots. Good afternoon, goeie middag, lotjhani, molweni, sanibonani, dumelang, ndi masiari, inhlakanipho.

00:12:51It is a great honour to table the budget for 2026/2027 medium term for the City of Johannesburg, as delegated by the Executive Mayor, Councillor Dada Morero. The City of Johannesburg is a city that carries the hopes of millions, the weight of history, and the expectations of South Africa. Johannesburg is where a young person from Limpopo

00:13:23arrives with a bag and a dream, where a young mother from KwaNongoma, KZN, braves the bright city lights to earn a living for her children, where Sandton's financial towers stand above communities still waiting for the full promise of democracy. Johannesburg is a microcosm of a South Africa that is riddled with inequality and buckling under pressure,

00:13:52but it remains a city of resilience, work, struggle, ambition, and hope. Our responsibility is to ensure that this hope is not betrayed by poor planning, defective governance, and infrastructure collapse. This budget must be an economic instrument to support growth, expand access to service, and enable investment and maintain existing infrastructure whilst investing in new services.

00:14:23Johannesburg is the economic heartbeat of South Africa, home to approximately 5.9 million people in 2.9 million households across the seven regions, contributing approximately 15% to the GDP of our nation. The future of Johannesburg is not only a local issue, it is a national economic and democratic imperative, and I dare say, Madam Speaker, an international matter.claim

00:14:56The budget we present today represents the last financial account and budget for this political term. It will speak honestly about the journey we have travelled, the pressures we face, and the Johannesburg we are determined to lead back to becoming a thriving world-class African city. Our theme, as presented for the State of the City Address, was Foundation for the Future: Your City, Our City, Mr. Mayor.

00:15:26Our budget follows this theme directly by building Johannesburg together, investing today, securing tomorrow. It means we must build together because no government can rebuild Johannesburg alone. We must invest today because deferred investment becomes tomorrow's crisis. We must secure tomorrow because this budget is for the city and that our children will inherit.

00:15:57In this budget, we choose responsibility over slogan. We choose repair over decline. We choose investment over neglect. We choose discipline over drift. This year carries deep historic resonance. We celebrate the 30th anniversary of our Constitution, the 50th remembrance of the June 1976 student uprising, and the 70th anniversary of the 1956 Women's March

00:16:28led by Mama Lilian Ngoyi, Mama Sophia Williams-De Bruyn, Mme Rahima Moosa, Mama Albertina Sisulu, and Mama Helen Joseph, and those were women of fortitude who we must always remember that we must never dare fail. It is because of their sacrifices that South Africans will exercise their democratic right to vote in the upcoming local government elections on the 4th of November. Accordingly,claim

00:16:54this moment concerns more than figures on a page, it concerns the record we present, the values we uphold, and the future we are determined to build. An honest reflection, Madam Speaker, is what is going to be required in this moment. We must resist the temptation to speak only in victories and equally resist speaking only in crisis. Both would be dishonest. Therefore, where we have erred and fell short,claim

00:17:25we ask our residents of Johannesburg to forgive us. We recommit to do better and serve with urgency. Where we have made strides to uplifting our communities, we urge you, residents and business and community members, academia, youth, women, faith-based organization, the LGBTQIA+ community, the arts, the sporting fraternity, the people with disability, civil society,

00:17:56to continue journeying with us because you attended all the IDP sessions, and today we will present a reflection of your submissions in the IDP processes. Johannesburg is not a failed city; it is a city under pressure. Service coverage remains significant: 99.3% of residents have access to water, 96% enjoy access to dignified sanitation,claim

00:18:2692% have access to electricity, and 87% are serviced by our refuse removal services. These numbers reflect the deliberate efforts, and I repeat, these numbers reflect the deliberate efforts of successive ANC administrations since 1996 to improve the lives of residents and expand services in an inclusive and transformative way. They reflect the successful equitable allocation of resourcesclaim

00:18:57and commitment to transform and human dignity. They also tell us that our task is to protect, maintain, and modernize the foundation. Ours is to guarantee reliable and efficient delivery of services. A household may be connected to water, but if pipes repeatedly burst, dignity is interrupted. A home connected to electricity still suffers if the network is unstable.claim

00:19:24A road still exists even when potholes are dangerous, but the infrastructure must be maintained and fixed. Revenue collection and institutional reform are therefore at the center of this budget. We built this foundation with the intention and commitment. Now our task is to protect what we've built, repair what has been worn out, and invest further in what our people deserve.claim

00:19:51The difficult truth is that Johannesburg's combined backlog is estimated at over 220 billion. Non-revenue water losses stand at 44.7% and electricity losses at 27%. No honest budget speech can avoid these facts. Johannesburg cannot budget its way out of a 220 billion infrastructure backlog through municipal resources alone.claim

00:20:22We must fund what is urgent, protect what is essential, leverage what is possible, and partner where our own resources fall short. For us to achieve the above, we must be able to manage every cent diligently and ensure accountability across all levels. We must exercise in word and in practice a zero tolerance on corruption and maladministration, as clearly articulated by the Executive Mayor in the State of the City Address.claim

00:21:02The city continues to operate within a difficult socio-economic environment. Global uncertainty, geopolitical tensions, volatile fuel prices, and domestic infrastructure challenges have increased pressure on municipal consumers and have strained our revenue base. Despite these challenges, Johannesburg remains the economic engine of South Africa, with an encouraging recovery through tourism, retail, commercial property, and growing investment in renewable energy and digital infrastructure.

00:21:36Cities across South Africa face widespread infrastructure challenges, aging assets, and persistent under-investment. Rapid migration resulting in increased and above-projection demands on services is a reality and has placed excessive pressure on availability of resources. National Treasury has responded through grant reforms, including performance-based incentives for metropolitan municipalities under the Metro Trading Services Reform Program.claim

00:22:10The city's own revenue base remains under pressure. Following benchmarking engagements with National Treasury, the projected revenue collection rate has been adjusted from 88.6% to 86% in line with historical performance. Every rand lost through illegal connections, meter tampering, billing weaknesses, non-payment, and water losses is a rand that cannot repair Johannesburg.

00:22:39We have put in place several revenue collection strategies, namely automation of revenue management system, customer-related data connections with registered bureaus, walking the floor program to improve customer relations and restore public perception of the city that cares while creating visibility, centralized query resolution and disconnections, and also ensure that we go as we walk the floor, as you would have seen this morning.

00:23:08The Executive Mayor and administrators of the City of Johannesburg, as a prelude to this budget, were on the ground making sure we deal decisively with those who steal revenue from the city. Madam Speaker, these interventions are aimed at arresting revenue leakage and protecting the city's financial integrity and the ability to deliver critical services. Madam Speaker, allow me to now table before council the budget for the 2026/2027 financial year.claim

Budget speech: tabling of the 2026/27 budget figures

00:23:42Our operating revenue is at 90.4 billion, operating expenditure 88.3 billion, projected surplus 2.1 billion, capital budget 8.8 billion, which will rise to 25.3 billion over the medium term. Madam Speaker, we are tabling a total budget of 97.1 billion for the 2026/2027 financial year for the residents of Johannesburg.claim

00:24:23Our key revenue drivers are electricity at 27.8 billion, water and wastewater 21.5 billion, property rates 18.8 billion, and refuse removal 3.6 billion. Every rand in this budget reflects our commitment to building Johannesburg together, investing today, securing tomorrow.

Budget speech: Metro Trading Services Reform

00:24:51The Metro Trading Reforms is one of the single most consequential institutional transformation in Johannesburg's post-democratic municipal history, which is going to directly shape our major budget allocation. These reforms are necessary because we have diagnosed, and the diagnosis is clear: Johannesburg's three core trading services, which is electricity,claim

00:25:21which we know it's under City Power; water and sanitation under Joburg Water; and waste management under Pikitup, have been weakened by split accountability, declining revenue collection, insufficient capital investment, governance failures, and the non-revenue water losses which exceed 40%, which I spoke about earlier. Electricity distribution losses stand at 27%, and the combination infrastructure renewal backlog across Joburg Water, City Power, Joburg Roads Agency exceeds 185 billion.claim

00:25:58Without meaningful institutional reform, capital investment alone cannot achieve this, and we have to work together to ensure sustainable service delivery. The Metro Trading Services Reform were developed in collaboration with National Treasury and were formally launched through a turnaround strategy which was approved by the City of Joburg Council on the 31st of July 2024.

00:26:28It addresses five conditions: the single-point management accountability; revenue optimization and financial turnaround; institutional and governance reforms; increasing infrastructure investment through new financing mechanisms, including the financing incentive grant, which is up to 54 billion in grants for over six years for the eight metropolitan municipalities that demonstrate reform; and performance-based incentives tied to a performance improvement action plan.

00:27:05The Metro Trading Services Reform has direct and specific implications for this particular budget. Ring-fencing of trading services revenue is progressively required, changing the city's cross-subsidization model. Loan-funded capital projects must demonstrate improved revenue generation or reduced operational losses. National Treasury has made available up to 27.7 billion in performance-linked incentive grants

Budget speech: tariffs and rebates

00:27:37over the medium term, with potential to unlock over 100 billion in combined infrastructure investment. But these grants are contingent on demonstration of reform, not merely on submission. Madam Speaker, tariff setting is one of the most consequential decisions that any council can take. Our policy is premised on three principles: affordability for residents, competitiveness and investment destination, and cost recovery sufficient to maintain infrastructure.

00:28:16Set tariffs that are too low cannot sustain infrastructure. If we set them too high, the residents cannot afford the services; then non-payment rises, and the revenue base then ends up collapsing. Getting this balance right is the discipline of responsible municipal finance. Madam Speaker, we do not take tariffs lightly, but neither have we forgotten that we have the most vulnerable.

00:28:48The first 300,000 of residential property value remains exempt from rates. Pensioners whose gross monthly household income is lower than 13,519 and the property value up to 1.5 million, they receive a 100% rebate. Every household receives the first 6 kiloliters of water free of charge. Indigent households of the Expanded Social Package receive 15 kiloliters of water and 50 kilowatt-hours of free electricity each month.

00:29:21More than 145,000 households are now registered on the Expanded Social Package, up from 124,000 in 2015. This is a demonstration of a caring ANC-led Government of Local Unity. For 2026/2027, tariff increases are driven primarily by the cost, administered and the input cost increase from Eskom and Rand Water, and they are largely outside the city's control because they are also compounded by inflation and the operating pressure.

00:29:59Elec-

00:30:00electricity tariffs, City Power proposes an overall average tariff increase of 9.1%. This is consistent with Eskom's bulk purchase cost increase following the NERSA's approval on the 4th of March 2026. By limiting increases to residential customers below the 9.1 rate, the effective average household increase is brought down to 8.63%.

00:30:28City Power's cost of supply study confirms that reducing energy losses from approximately 27% to 15% would alone generate an additional revenue of up to R3.5 billion without further tariff increase. This is why the Trading Services Reform Program I spoke about earlier is central to the city's to City Power's financial sustainability.

00:30:58On affordability, the residential prepaid low tariff for registered indigent customers remains exempt from services and the network capacity charges. City Power's average indigent tariff at 350 kilowatt-hour per month is lower than Eskom. A 2% surcharge applies to businesses and large power users in order to support the network and sustain the network.

00:31:28On water and sanitation tariffs, Johannesburg Water's increases are driven by the 11% bulk purchase cost increase from Rand Water. Combined water and waste revenue is projected at R21.5 billion. Water tariffs use an increased block model and the first 6 kiloliters per month is free. Sanitation tariffs on multi-dwelling units with erf size of 300 to 1,000 square meters have

00:32:000% increase, providing interim relief while alternative structure and we restructure a model for 2027/2028. For indigent households through the Expanded Social Package, free water allocation, as mentioned earlier, and a 100% rebate on sanitation charges. A water demand management levy of R107.74 per month domestic connection covers

00:32:30the fixed network and availability costs. Pikitup's tariffs increase by 6.2%, below the increase in water and electricity, reflecting the mandate to keep waste management accessible while advancing financial sustainability. Property rates increase by 3.6%. This is the lowest increase of any service charge, deliberately set to balance budgetary requirements

00:33:00with affordability. The rebate structure protects pensioners, persons with disabilities, child-headed households, and other vulnerable groups. Every rand of the rates rebate granted is a deliberate investment in the well-being of our residents, and balanced affordable tariffs are how we invest today in a city that works for everyone together. Madam Speaker, alongside this budget,

Budget speech: financial turnaround framework and implementation

00:33:30we are tabling a financial turnaround framework, which will need to be approved by council. Financial recovery alone will not be achieved through revenue collection alone. It requires simultaneous action and expenditure control, trading services reform, audit remediation, entity stabilization, capital discipline, labor management stability, and

00:34:00stronger oversight. The framework is organized around six pillars: financial recovery, revenue enhancement, expenditure containment, creditor and liquidity reform, governance and compliance, and labor stability. The framework is supported by the hybrid model of sweeping arrangements reform and a phased revenue sharing agreement commencing with Joburg Water

00:34:30on the 1st of July 2026. The immediate test is implementation discipline. Johannesburg has significant plans and diagnostic reports. The problem is not the absence of plans, but the persistent failure to convert them into measurable outcomes. The City Manager, as the Accounting Officer in terms of the Municipal Systems Act and Finance Management Act,

00:35:01must and should assist in leading an integrated implementation model and align departments and entities' service delivery priorities through measurable outcomes, monthly reporting with the CEOs, MDs, and all department heads implementing in their respective areas. It is of no use if we continue to have the plans and work, but then the implementation falls short.

00:35:32Council must therefore mandate the City Manager through a city-led implementation architecture with a single tracker reporting against measurable dashboard and the agreements of performance aligned to the framework. Council must continue to support efforts by the Gauteng Provincial Government, COGTA turnaround strategy, which was launched by the Gauteng Premier overseen by MEC Mamabolo, as it

Budget speech: revenue recovery and Debt Relief Programme

00:36:01complements the financial turnaround framework we are tabling today. Madam Speaker, there can be no service delivery without revenue. There can be no infrastructure recovery without collaboration. There can be no investment without financial credibility. This budget strengthens revenue recovery through the Revenue War Room enforcement in line with Section 118 in terms of how we seek to move. The Debt Relief Program remains

00:36:31an important intervention for residents genuinely unable to pay. But we must be honest, a city cannot function if those who can afford to pay refuse to pay. Non-payment weakens service delivery, it delays maintenance, and it punishes the poor. The social contract is clear. The city must bill correctly, deliver services and respond to complaints, and residents and businesses

00:37:01and make sure that all government departments, national and provincial, they pay the city. This is what it means to build Johannesburg together. While we are taking decisive action to strengthen the city's finances, we are equally committed to ensuring that our recovery efforts remain centered and compassionate. Financial sustainability cannot come at the expense of those residents and institutions which

00:37:31demonstrate that they are willing to pay, but they need historic challenges resolved. To date, more than 9,000 residents, faith-based organizations, small businesses and enterprises, NGOs have already applied for our Debt Relief Program. We are encouraged by those who have applied. And these qualifying individuals are an indication that the organization stands to benefit from meaningful financial relief,

00:38:01these organizations. And as part of this intervention, the city anticipates implementing the write-off of up to 50% of debt on qualifying accounts across Johannesburg before the 30th of June 2026. This program is intended not only to alleviate financial burdens, but also to restore accounts to being manageable and create a sustainable foundation

00:38:30for future revenue collection. The program remains open and we encourage our residents, businesses, faith-based organizations, and institutions, pensioners to come forward and apply for the Debt Rehabilitation Program, which will close at the end of November 2026. We want to work with you in our communities because rebuilding the financial health of our city

Budget speech: workforce and politically facilitated agreement

00:39:00is a shared responsibility and a collective journey. Together, through disciplined partnerships and shared commitment, we can place our city towards a path of recovery. Madam Speaker, our workforce is our most valuable resource and must be adequately compensated. Equally, we want a professional workforce, reliable, efficient, and productive in service of our people.

00:39:30The politically facilitated agreement budget allocation addresses historic legacy salary disparities. The ANC-led Government of Local Unity has demonstrated its commitment to ensuring that workers receive fair compensation with the intention of accelerating service delivery, strengthen revenue collection, and improve interface through a motivated and a skilled workforce.

00:40:00Madam Speaker, much has been said about the PFA and the strong anti-workforce sentiments have found itself amongst opposition benches. With the responsibility of incumbency that is upon us, we have and we will always act with reason, diligence, and accountability. In this regard, as led by the Executive Mayor, we will continue our engagements with National Treasury

Budget speech: trade-offs of a funded budget

00:40:31and Minister Enoch Godongwana. We are committed to ensure that we maintain fiscal discipline and integrity of the city whilst meeting our obligations which were approved by council. Financial recovery is not an end in itself, it is what makes it possible to keep building Johannesburg together. Trade-offs and discipline of a funded budget,

00:41:01and this council deserves honesty about them and the structural choices embedded in this budget. Madam Speaker, not every request can be possibly funded. Not every political priority can be accommodated. And I want to name the key trade-offs plainly. Conditionality versus political priority projects. The capital program draws approximately R5 billion national conditional

00:41:31grants. The Urban Settlements Development Grant, Public Transport Network Grant, Urban Development Financing Grant, Urban Informal Settlement Partnership. Each of these, they are ring-fenced for specific purposes. And this is the discipline and the understanding to ensure that when something is ring-fenced, it is utilized specifically for that. They cannot be

00:42:00redirected to any other function at an infrastructure ward level. Where community requests fall outside grant definitions, projects can only be funded from the city's own cash or borrowing. Both severely constrained with the cash cost coverage ratio of only 9.8 days against a benchmark of 30 to 90 days. The rule is simple. Every capital commitment must have a named,

00:42:31available, and compliant funding source before it can enter the program. Trade-off two is the loans that we have, which account to R3.5 billion, which is 39.9% of the capital budget. Every rand borrowed must be serviced from operating revenue. Interest and loans redemption represent approximately 7% of the total operating expenditure,

00:43:00within the acceptable benchmark, but only if our borrowing remains disciplined. Under the Metro Trading Services Reform, loan-funded projects in trading services areas must demonstrate improved revenue generation or reduced operational losses. Trade-off three, ring-fencing versus cross-subsidization. For years, trading service surpluses have cross-subsidized roads, public

00:43:31safety, administration, and entity subsidies. The Metro Trading Services Reform progressively requires that we end this model. Non-trading functions must increasingly be funded from property rates, the equitable share, and our own source of revenue. This structural shift intensifies in this medium-term period. The deliberate decision to protect and grow the sustainable

00:44:01service cluster allocation by 9.7% is precisely to stabilize the revenue base on which all other services depend. The last trade-off being Eskom and Rand Water creditor settlements, which impose a capital direct constraint on new capital. Every rand collected to creditor repayments is unavailable for new infrastructure. This is the right trade-off. Unresolved obligations would

00:44:31damage the city's credit standing, risk supply interruptions, and undermine investor confidence. Some communities may not see new capital investments now because the city is honoring obligations that protect the system that serve them daily. This is an honest, but a difficult message, and National Treasury's funding assessment required adjustment through natural attrition of salary savings, customer collection

00:45:01level alignment, and contracted services reductions. These are not discretionary choices, they are the conditions of a funded budget. They are the conditions that enable us to say that we are presenting a funded budget for the City of Johannesburg. Every commitment has a funding source, every project has a compliant justification. This is what a funded budget looks like. Discipline today

Budget speech: alternative funding, maintenance and investment attraction

00:45:31is the investment that makes tomorrow possible. This is how we build Johannesburg together. Madam Speaker, the Executive Mayor in the State of the City was very clear. The City of Johannesburg will not win the battle of backlogs alone. The scale of our infrastructure challenges is going to require innovating funding models. This budget supports

00:46:01all these alternative funding models through multilateral development banks, development finance institutions, national grants, provincial partnerships, public-private partnerships, as well as private sector co-investment. Critically, the budget must also show commitment to maintenance and repairs of the existing infrastructure and must align to National Treasury's

00:46:31guidelines on percentage of maintenance expenditure against revenue. As the City of Joburg, we are increasing the budget for maintenance and repairs from 7% to 8% to ensure that we have adequate resources towards critical day-to-day maintenance, as well as deal with our water and sanitation in line with the trading services reform efforts. In the State of the City Address, the Executive Mayor

00:47:00recorded R26.6 billion in investment that was attracted and approximately R2 billion in economic activity from the international events, including the U20 and G20 on the African continent, which was hosted under his leadership, and this is a demonstration that Johannesburg is open for tourism. This includes R27 billion in the foreign direct investments and R5.4 billion Microsoft Data Center, R7 billion

00:47:31waste-to-energy partnerships, and the R760 million Midrand bulk water storage facility. These investments show that Johannesburg is still investable. And investor confidence survives on implementation of a stable governance, and a city does not attract investment only by wishing. It is through deliberate programs, international events that I have indicated we hosted.

Budget speech: electricity, water and waste services

00:48:01It attracts investments by adhering to the highest standards of good governance and predictability, and lastly, consistent improvements to infrastructure. Every partnership forged is a commitment to investing today so that Johannesburg can thrive tomorrow. The City Power Turnaround Strategy that I spoke about earlier centers on five pillars: infrastructure investment to rehabilitate the distribution

00:48:31network, revenue enhancement and billing accuracy, loss reduction through smart metering and supervisory control and data acquisition upgrades, diversification of energy mix through solar independent power producers and small-scale embedded generation, and organizational restructuring and positioning of City Power as an energy services platform. Madam Speaker, the budget allocates approximately R28.3 billion in operating

00:49:00expenditure to City Power, and a capital program of R6.7 billion for the medium term. These resources will support the grid strengthening and strengthen the grid, smart metering, electricity losses, electricity loss reduction, informal settlement electrification, public lighting, and embedded generation and renewable energy projects. The city is finalizing the development finance linked

00:49:31to projects, as approved by council yesterday, including the recent loan of KfW, which is worth 200 million euros to support City Power's infrastructure. Similarly, Madam Speaker, the city is engaged with constructive discussions with Eskom on the current debt and recovery interventions with the support and collaborative efforts from national government, as well as regularization

00:50:01and working with SALGA and regulators and financial institutions. Energy reform is not optional. It is central to Johannesburg's economic survival. We welcome the ongoing dialogue between the Minister of Electricity and Energy, Dr. Kgosientsho Ramokgopa, as well as the Eskom Group CEO, Mr. Dan Marokane. Ourselves in the City of Johannesburg, led by the Executive Mayor, we are saying to

00:50:31council and residents, a secure energy future is at the heart of building Johannesburg together, and it starts with the investments that we make today, including the intergovernmental relations that we are committed to. On water and sanitation, on water's reform, Johannesburg Water targets non-revenue, leak detection, and the progressive replacement of the most vulnerable sections

00:51:01of the reticulation network. The target for 26/27 is to reduce non-revenue water from 226 to below 185 megaliters per year. Every megaliter saved is a megaliter of expensive Rand Water bulk purchases. The Vaal system's capacity constraints is adding urgency. Johannesburg cannot afford to lose 40% of treated water while the source system

00:51:33itself is under stress. The budget allocates approximately R21.6 billion in operating expenditure to Johannesburg Water, with R6.4 billion in capital investment over the medium term. Every liter saved, every pipe replaced, these are the investments today that secure tomorrow's water for every household in

00:52:01Johannesburg. A clean city is a dignified city. Residents do not ask for miracles. They ask that the refuse be collected and that illegal dumping be removed. Johannesburg is running out of landfill sites. That is an honest reflection we have to make. This is not a distant problem. It is a structural risk. Pikitup reform focuses on fleet modernization,

00:52:32progressive closure of the end of the landfill sites, and planning for alternative waste treatment. Madam Speaker, the operating expenditure allocated is approximately R5.2 billion, which will support landfill rehabilitation, fleet reliability, waste diversification, as well as illegal dumping removal, as well as leading programs to engage communities and educate

Budget speech: roads, inner city and township renewal

00:53:01them about the importance of a clean city. A clean city is a dignified city, and cleanliness is part of building Johannesburg together. On roads, stormwater, and bridges, every morning you have a Mmasetshaba Tlou who leaves Soweto before sunrise to work in Sandton. When the traffic lights fail, she pays the price. When the roads deteriorate, she pays the

00:53:31price. The cost is not only money. It is time away from children and the stress before work, and at times, lost income. Apartheid spatial planning still shapes the daily lives of our working people. This budget, Madam Speaker, allocates R1.8 billion for roads and stormwater operations, and R570 million for capital investment supporting road

00:54:01infrastructure and resurfacing, gravel roads upgrades, bridge rehabilitation, stormwater infrastructure, traffic signals, the BRT, and the public transport network. A pothole in Johannesburg is not just a pothole. It is an indication and a symptom of a maintenance deferred, and this budget prioritizes maintenance and renewal. We no longer treat maintenance

00:54:31as an afterthought. It is the quiet work that prevents collapse. It is the reliable transport we are investing in today so that when we move, everyone is able to move and Joburg works. The inner city is the pulse of the City of Joburg. The State of the City Address by the Executive Mayor identified a pipeline of inner-city projects, which include

00:55:01the Inner City Gateway, High Court Precinct, Walkable Network, Rissik Street Flat Renewal, Florence House, Hillbrow Hospital, Joubert Park, Joburg Art Gallery, Jack Mincer Facility, and De Villiers. The inner city spend is distributed across multi-votes towards precinct-based revitalization, public environment upgrades, building rehabilitation, hijacked building interventions,

00:55:32public lighting, bylaw enforcement, informal trading, and partnerships with business and civil society. The rehabilitation of the inner city requires a multi-pronged and multidisciplinary approach which encompasses all stakeholders. Township renewal remains equally central. The budget supports the Orange Farm Renewal Program, the Jabulani Precinct upgrades, the Lufhereng Mixed-Use

00:56:01Development, the hostel redevelopments, informal settlement upgrades, transit-orientated development, and inclusionary housing. The State of the City Address recorded 9,188 inclusionary housing units processed, and 1,364 transit-orientated development units, and major catalytic projects, including the Lanseria Smart City, Lufhereng, Southern Farms, Riverside

00:56:31Mega Project, and Tanganani Mega Project. And these are projects that are going to change the lives of our people. The inclusive development of Johannesburg cannot be centered only in the affluent areas. That is why this budget is an inclusive budget that must not only speak about affluent areas, it must be inclusive of Orange Farm, Alexandra,

00:57:03Diepsloot, Ivory Park, Eldorado Park, Lenasia, Soweto, Ennerdale, Kliptown, Roodepoort, Zandspruit, Randburg, and the inner city. This is what an inclusive development and spatial justice requires, and rebuilding our inner cities and our communities and our township is spatial justice made real, investing today so that all of them can thrive.

Budget speech: safety and law enforcement

00:57:35Madam Speaker, on safety and law enforcement, every evening there is a mother who waits to return home safely. Her expectations are clear. She wants working streetlights. She wants a safe park. She wants visible law enforcement, emergency services that respond, public spaces where women and children can move without fear. And this is what they

00:58:05deserve and need from a City of Joburg. This budget, Speaker, allocates R7.2 billion towards JMPD visibility, bylaw enforcement, emergency services, CCTV, and the Integrated Intelligence Police Center, public lighting, urban management, inner-city enforcement, and disaster management. The rule is not of

00:58:37This budget also supports the work to make sure that we deal with cable theft, vandalism, because we can no longer normalize it. This budget supports enforcement that is firm, fair, and developmental. Madam Speaker, we must also state that our infrastructure is under attack. Organized syndicates are destroying millions in infrastructure, targeting

00:59:06traffic signals, electricity transformers, water pumps, pipes, and road rails, and paving on our sidewalks. The scourge of illegal mining in some of our areas on the reef undermines the structural integrity, also is criminality which terrorizes our communities. Our investment in safety and security will immediately deal and arrest these coordinated attacks. We must claw back the significant

00:59:36resources we currently utilize to replace and repair infrastructure damaged, stolen by criminals. And we will continue to urge and work with JMPD to ensure that our central business districts are reclaimed from the tentacles of crime and grime, and this budget allocation makes it easy

Budget speech: community upliftment, governance and cost containment

01:00:00for us to deal with this particular decay. Safety is the foundation on which everything else is built on and we can only build Johannesburg together when every resident is secure. The true purpose of government is to improve the lives of our people. This budget Madam Speaker places a strong emphasis on community upliftment and inclusive development.

01:00:26Free basic services for qualifying households, indigent households, informal settlement upgrading, 2,200 additional households connected to the water, and above 3,000 to sanitation. Social housing, above 2,000 units that are going to be constructed, and four identified hostels to be upgraded.

01:00:522000 new title deeds to be issued in high density residential zones. Expanded public works program which will assist with over 12000 job opportunities for the 2026-2027 financial year. Social development budget of 409 million supporting women, persons with disabilities,

01:01:21children, LGBTQIA plus community and the vulnerable groups. Every household uplifted, every job created. No community will be forgotten and no community will be left behind. On good governance and accountability and the clean audit that we speak about and live by, financial recovery cannot succeed without governance reform. Revenue collection without clean administration will fail.

01:01:51and without procurement discipline will falter. Every reform without consequence management will fail. The budget supports stronger governance through improved audit action plans, consequence management, anti-corruption interventions, internal controls, risks management, supply chain discipline, and performance monitoring. Madam Speaker,

01:02:20In quoting the executive mayor, he said corruption must not be tolerated and where it occurs, arrests must be made. This must not be a ceremonial statement. It must be an operating principle. This budget is not only about how much money is allocated. It is about whether the money is spent well. Underspending on capital is not a saving.

01:02:50It is delayed service delivery. It is stealing from the down froden. Poor procurement planning is not administration. It is and it must be improved in line with the framework that will require approval tomorrow. This is why the city will strengthen capital expenditure, monitoring of projects and consequence management and where delivery fails

01:03:20Without justification, all responsible must be brought to book. We will also introduce and institutionalize a culture of interim financial statements because we want to strengthen good governance and we appreciate the support that we have received from the auditor general in working towards ensuring that Johannesburg is in good financial state.

01:03:50The City of Johannesburg budget embeds a cost containment primary preliminary through workforce discipline and operational risks. Employee costs are managed via a 2.5% natural attrition and contracted services are held to just 2.4% growth, operational costs to 1.1%. Procurement discipline is enforced through the SCM policy,

01:04:19On the revenue and asset side, the budget treats loss reduction as its most powerful cost and containment lever. City Power targets electricity losses down to 25% of bulk purchases, meter programs and prepaid metering rollouts, tackle non-revenue water and illegal connections, as well as penalties to create both deterred and cost recovery. Repairs and maintenance are held at 8% of PPE,

01:04:49and 40% plus of capital spending goes to asset renewal, both National Treasury benchmarks designed to avoid a far con- consider emergency and interventions later. Underpinning all of this is an 80%, 86% debt collection rate target, active tariff re- uh reflecting reviews as and a formal Treasury structural reform program.

Budget speech: political remarks, tributes and coalition governance

01:05:19Good governance is not optional. This is the foundation and which we are building today and together. Mr. Mayor, it must be mentioned that our city has faced immense challenges. The lack of stability and political ineptitude born out of the 2016 and 2019 calamity of the then Democratic Alliance leadership

01:05:49under the government led by the accidental mayor. And again in 2021 to 2023 under the erstwhile doctor who turned politician. Mr. Mayor, Mr. Mayor, this has left severe entrenched challenges in the system, which are yet to be fully ventilated and exposed. I can safely say, you have laid the foundation

01:06:19You have contributed in a very short space of time, including your time as MMC finance. And for that, Mr. Mayor, we thank you for saving Johannesburg in the short space of time.

01:06:49isiZuluMajoro,

01:06:51may you continue to do the work

01:06:53isiZulukukhonkothwa ehambayo.

01:06:59Madam Speaker, I also wish to take this opportunity to pay tribute to my late comrades, Geoff Makhubo, Jolidee Matongo, and Mpho Moerane. Two of whom served as MMCs for finance, and later served as executive mayors. May their souls rest in peace.

01:07:26These three gentlemen made a significant contribution which is being continued by the current executive mayor. They made a contribution to shaping the development and advancement of our great city of Joburg. In pursuit of retaining Johannesburg as a world-class African city, coalition governance has brought both opportunities and challenges,

01:07:56and the political contestation has at times produced delays and uncertainty. Yet, the city of Johannesburg continued to function under the ANC-led government of local unity. Clinics have remained open, emergency personnel have remained on duty, workers continue to serve residents. Even so, the era of coalition governance must not

01:08:26divert our focus on long-term planning in favor of short-term party political gains. We must consistently act in ways that show due care for sustainability and growth. The current coalition has made every effort possible against a consistent pushback from the voices of the privileged minorities to ensure we save the people of Johannesburg equitably and with requisite sensitivity

01:08:56to their needs and frustrations and their means. We are a government committed to saving the residents of our city and we commit and our actions are informed by our unwavering commitment to justice, redress, and progress. Madam Speaker, in conclusion, this 97.1 budget is about laying a foundation for the future.

Budget speech: conclusion and appeal ahead of 4 November elections

01:09:26A future where infrastructure works, where communities are uplifted, where young people can access opportunity, where government is responsive and accountable, where Johannesburg once again stands proudly as a world-class city. The challenges before us remain real, and we did not and have never shied away from them. We have confronted these challenges, yet we continue to do the work

01:09:56amidst all of that. But so too, it is important that we remember that Johannesburg has always been a city of courage, innovation, and a city of possibility. A city that has never been defeated by its difficulties. Through this budget, we commit 8.8 billion in capital investment for the 2026-2027 financial year and a 25.3 billion over the medium term. Through this budget,

01:10:25we will protect core services. We will strengthen financial discipline. We will implement the Metro Trading Services reform that will transform our entities to resilient, accountable, and financially sustainable utilities. We will direct 60% of capital to historically marginalized areas. We will set measurable targets and track them publicly. As we approach the government the local government

01:10:55elections on the 4th of November. We must recommit ourselves to a politics of service rather than division. Residents alone, they know what they need to do. Residents want water that is flowing in the taps. They want reservoir built, and the ANC-led government of local unity has already started on the program of building reservoirs, as you would have seen with the Brixton launch that was done earlier in the month.

01:11:29Madam Speaker, Executive Mayor, when we return after the 2026 local government elections, when we return after the 2026 local government elections in November, we will continue to ensure the stable, compliant, and honestly constructed financial foundation we have laid. Madam Speaker,

01:12:00This is the last budget before our residents return to the polls on the 4th of November 2026. They will be asked to choose between two paths. And the contrast could not be clearer. One path is the path that we offer, defined by stability, investment, fiscal discipline, infrastructure renewal, and opportunities for young people.

01:12:30a path where the ANC-led government of local unity has kept the lights on during the worst period of load shedding this country has experienced in many years and we have exceeded over 365 days, where city power built through working together is stabilized, where we stabilize Joburg water, where we turn around the Johannesburg road agency,

01:13:00where we expand free basic services, that is the path residents are going to choose. They will not choose the path that is marked by uncertainty, that is marked by collapsing coalitions and service disruptions. They will not choose a path of people who choose to swim instead of confront problems.

01:13:30We have seen that path. We have seen how it undermines service delivery and belittles the genuine needs of our people. That path is a bad path that will not happen here, provided the residents choose continuity and discipline in the coming elections. We believe that a working-class mother in Alexandra

01:14:00or Soweto deserves right reliable water. That a young person from Idutywa, from Thabazimbi coming here with a bag of dreams deserve a city that works. That a pensioner sitting in Mphumulwa Mqashi deserves safety and dignity. That is the Johannesburg we are building. That is the Johannesburg on the path of renewal and service to the people. This budget is about building

01:14:30a stronger and a more resilient Johannesburg for the future generations. If we work together, government, business, labor, civil society, faith-based organization, there is no challenge we cannot overcome. This is your city. This is our city, and together we will build the foundation for the future, investing today and securing tomorrow. I thank you, Madam Speaker.

01:14:58isiXhosaNdiyabulela

Presentation of budget book and singing in the chamber

01:14:59Mr. Mayor, I now present you with the budget book of the city of Johannesburg.

01:15:22Open it so we can see there's no money inside.

01:15:30isiZuluBashaye, bayasibiza, bayasibiza, bayasibiza laba abazi lutho, bashaye Mmamorero

01:15:40isiZuluSithi bashaye, bayasibiza, bayasibiza laba abazi lutho,

01:17:08Thank you, counselors.

01:17:10Please don't do that.

01:17:11Thank you, counselors. Thank you, counselors. Thank you, counselors. Thank you so much. Thank you, counselors. Point of order. Point of order, Madam Speaker. Can we be seated? Can we be seated? Counselor Belinda, point of order on the singing.

Point of order on belt and singing

01:17:40Thank you. Madam Speaker, we are not allowed to bring dangerous weapons into this house. Councillor Kunene has just started whipping in this house. And I want to remind this house, I want to remind the house the singing is there,

01:18:02isiZulubut capacity dololo.

01:18:04Counselor Belinda. Counselor Belinda.

01:18:06You can go and sing.

01:18:08Colleagues, I rule. Counselor Belinda. All the other men that's sitting on the other side, are they wearing belts? No, counselor, counselor. Counselors, no. Counselor,

01:18:30MMC, I'm not going to give you a chance. I'm not going to give you a chance. Counselor, I'm not giving you, I didn't give you a chance to speak. Colleagues, I'm not sure, but counselors, can we continue? I asked the question if any other man in the room is not wearing a belt. Please, thank you.

01:19:01Colleagues, colleagues. No, counselors, counselors, please. You were so patient with the speech. Counselors, no, no, no. Counselor Belinda, you don't do that. I'm going to continue. Counselor.

Speaker's thanks and adjournment

01:19:20You are biased, speaker, biased.

01:19:22I'm not biased. I'm not biased. Thank you so much, MMC Masuku, who's also the Deputy Executive Mayor for presenting the city's last budget speech of the political term of office. Counselor, thank you so much once again. But as we usually do, you will all be granted

01:19:50an opportunity to comment on the budget speech and consider the reports tomorrow at 10:00 in the council chamber. We have come to the end of our meeting. Thank you very much, counselors, and thank you so much to the guests in the gallery for honoring us for this day. To all the media people, thank you so much. Thank you.

01:20:22The meeting has been adjourned. You can all go home. Thank you.