The Democratic Alliance (DA) has written to National Treasury to intervene and provide immediate support for Nelson Mandela Bay to prevent another forfeiture of hundreds of millions in conditional grant funding.
The City is heading for yet another significant underspend on conditional grant funding, which will almost certainly result in further forfeitures to National Treasury. As of the end of March 2026, with less than three months remaining in the financial year, the municipality has spent only 34.18% of its capital works budget intended to rebuild collapsing water, electricity, sanitation, and road infrastructure.
This will mark the third consecutive year that the Metro has failed to spend its infrastructure budget, having already forfeited approximately R1.2 billion in conditional grant funding and R240 million in equitable share over the past two and a half financial years.
Adding insult to injury, the City is now losing R1.5 billion annually to electricity losses and a further R1.2 billion to non-revenue water. This means that investing grant funding in the refurbishment of electricity and water infrastructure would not only improve service delivery but also result in significant cost savings.
National Treasury applies a “use it or lose it” policy to conditional grant funding, meaning that any funds not spent are redirected to other municipalities. The DA is of the view that National Treasury has long been aware that, due to unstable coalition governance and the exodus of critical administrative skills, the City is unable to oversee and implement large-scale capital projects.
There is therefore a responsibility on National Treasury to support the City, rather than effectively penalising residents through the repeated forfeiture of grant funding.
The DA has demonstrated that, when governing Nelson Mandela Bay, it can make the City’s finances work for all residents through prudent spending. Under former DA Mayor Retief Odendaal in the 2022/23 financial year, the City not only recorded the highest cash holdings in its history but also achieved its only unqualified audit opinion in the past 14 years.
It’s not rocket science to get Nelson Mandela Bay’s finances back on track. This year we have the opportunity to vote for a DA government with Retief Odendaal as Mayor, who will put a stop to the underspending plane crash. The choice is clear. More of the same failure or wholesale changes that will get Nelson Mandela Bay working again.