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The R13.5 billion in equitable share funding withheld by the National Treasury from 69 municipalities in July 2026 could be released within two weeks to a month, depending on how quickly the affected municipalities comply with Treasury’s requirements.

Treasury’s Head of Intergovernmental Relations division, Ogalaletseng Gaarekwe, said municipalities had been requested to submit detailed repayment plans outlining how and over what period they intended to settle their outstanding debts.

Gaarekwe was briefing the media on Wednesday morning, where she provided further details on the decision to temporarily withhold the funds. 

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Her remarks expanded on the reasons contained in the Treasury’s statement issued on Tuesday, explaining why the department considered the intervention necessary.

She said that although 99 municipalities had initially been identified for possible action, the number was reduced to 69 after the Treasury assessed the responses received.

“We analysed the responses given by the municipalities and found that some of the amounts were disputed. Municipalities were instructed to pay what they owe during this financial year. In the last financial year, R475 billion was withheld from municipalities,” Gaarekwe said.

She said the affected municipalities were classified according to the nature of their financial challenges. 

Some had adopted unfunded budgets, while others had accumulated debts owed to entities including Eskom, water boards, the South African Revenue Service (SARS) and the Auditor-General.

“Municipalities with unfunded budgets were expected to commit to avoiding the adoption of unfunded budgets going forward. It was simply a commitment that we sought from municipalities in this category,” she said.

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Those that owe Eskom, water boards, SARS and other creditors were required to submit payment plans signed by both parties.

“Once we receive those undertakings, we release a portion of the equitable share, probably one-third so that the municipality can begin settling those accounts in line with the agreement reached with the creditor. Once proof of payment has been provided and verified, we release the remaining funds to the municipality.”

Gaarekwe said the staggered release of funds is intended to ensure municipalities honour their repayment commitments while enabling them to continue delivering essential services.