Treasury implores metro municipalities to spend effectively on service delivery
It has now launched an incentive-based grant for government spending capped at R54 billion over six years.
National Treasury director general Dr Duncan Pieterse at a budget media briefing on 12 November 2025. Picture: GCIS
The National Treasury has established that many metropolitan municipalities are underspending on their budgets, noting that this denies residents service delivery.
It has now launched an incentive-based grant for government spending capped at R54 billion over six years.
This lifeline works on a performance review system, where funds are released to meet specific performance targets.
Treasury’s Director General Duncan Pieterse said when funds are not used, they are re-allocated to other municipalities or sent back to the revenue fund.
“While it contributes to the overall health of the National Revenue Fund [NRF] when funds are returned, the ultimate objective of those funds is to improve service delivery in those areas, and we would much rather those funds be spent there.”