Walk into any municipality office in Maluti-a-Phofung, and you will find something remarkable: a complete absence of financial records stretching back four years. Not incomplete records. Not poorly maintained files.
Nothing. The auditors literally cannot do their job because there is nothing to audit. This is not incompetence through ignorance. Court documents from the Free State High Court tell a different story—one of deliberate capture by politically connected elites who invalidated R27 million in debt agreements for their own benefit.
This report examines the ten worst cases of municipal failure in South Africa, drawing from Auditor-General reports, National Treasury data, and Special Investigating Unit investigations. The findings reveal something more troubling than isolated corruption. What emerges is a pattern of institutional collapse so entrenched that it threatens the constitutional promise of local democracy itself.
1. Maluti-a-Phofung Local Municipality (Free State)
This Free State municipality represents the nadir of local government in South Africa. For four consecutive years, auditors have been unable to complete their work because the municipality failed to submit consolidated financial statements on time or at all. This sustained failure equals a perpetual Disclaimed Opinion—a complete absence of financial accountability.
The operational consequences are severe. Maluti-a-Phofung owes Eskom R8 billion as of July last year, directly threatening electricity supply to residents. But the financial crisis stems from something more deliberate than mismanagement. The Free State High Court exposed a scheme where certain officials captured municipal resources for political elites. The court invalidated R27 million in irregular debt agreements, confirming that lack of accountability enabled systematic resource exploitation.
When basic financial statements disappear for years, it is not an administrative oversight. It is evidence of capture.
2. Ngaka Modiri Molema District Municipality (North West)
Four consecutive years of Adverse Audit Opinions. That is the record for Ngaka Modiri Molema, a district municipality in North West Province. An Adverse Opinion is not a warning—it is a condemnation. It states clearly that the financial statements are so unreliable they cannot serve any oversight function.
The municipality typically cannot provide supporting documentation for the performance achievements it reports. The records do not exist. This absence of basic compliance has triggered ongoing Special Investigating Unit intervention under Proclamation R23 of 2020, targeting severe malpractices and maladministration. The SIU does not issue proclamations lightly. They represent formal recognition that corruption has become institutionalized.
3. eThekwini Metropolitan Municipality (KwaZulu-Natal)
As South Africa’s third-largest city, eThekwini’s corruption operates at a different scale. The latest data shows R2.4 billion in Irregular Expenditure—money spent in violation of procurement rules. The concentration in irregular rather than unauthorized expenditure suggests something specific: sophisticated, large-scale breaches of supply chain management processes.
This pattern aligns with national reports identifying KwaZulu-Natal as a hotspot for construction mafias and tender manipulation. The Special Investigating Unit has been active here under Proclamation R9 of 2021, and has instituted civil proceedings to recover R29.1 million from the metro. The financial mismanagement directly causes service delivery failures, but the scale of irregular expenditure points to organized networks exploiting procurement systems for political patronage.
4. City of Tshwane Metropolitan Municipality (Gauteng)
South Africa’s capital city has demonstrated alarming financial deterioration. Tshwane accumulated R3.8 billion in Irregular Expenditure and R423 million in Unauthorized Expenditure during recent audit periods. The metro previously regressed to an Adverse Opinion after holding better audit outcomes, marking a swift collapse of financial controls.
Tshwane has struggled with irregular expenditure across multiple years, alongside reports of fruitless and wasteful spending. The pervasive nature of these violations suggests procurement systems have been structurally compromised. Non-compliance has become routine rather than exceptional. When a capital city cannot maintain financial discipline, it signals that political will to enforce controls has evaporated.
5. City of Johannesburg Metropolitan Municipality (Gauteng)
The economic heart of South Africa faces compounding crises: massive financial loss combined with relentless political instability. Johannesburg reported R1.28 billion in Unauthorized Expenditure and R811 million in Irregular Expenditure. The unauthorized spending is particularly troubling—it indicates officials routinely exceed spending mandates without proper authorization.
Beyond the numbers, governance structures have been captured. Reports document allegations that city-owned entities such as City Power and Pikitup are “heavily tainted by corruption and political interference.” Officials allegedly capture these entities for private benefit through tender manipulation. The corruption causes direct service collapse: chronic power outages, water scarcity, uncollected refuse. Political instability acts as an accelerant, preventing consistent accountability and allowing patronage networks to operate without challenge.
6. Mangaung Metropolitan Municipality (Free State)
Mangaung struggles with chronic financial dysfunction despite multiple provincial interventions and recovery plans. The metro reported R1.19 billion in Unauthorized Expenditure and R198 million in Irregular Expenditure. These figures reveal a municipality locked in a cycle of financial indiscipline, having reported three consecutive years of unauthorized, irregular, and wasteful expenditure.
The pattern confirms that internal controls are functionally absent. More troubling, it demonstrates that political will to implement lasting reforms does not exist. The continuous drain on public funds continues unabated, year after year, despite external interventions. When recovery plans fail repeatedly, it suggests resistance rather than incapacity.
7. Buffalo City Metropolitan Municipality (Eastern Cape)
Buffalo City exhibits persistent failure in supply chain processes. The municipality recorded R1.7 billion in Irregular Expenditure, confirming widespread non-compliance with procurement rules across three consecutive years. The scale of irregularity indicates that internal oversight mechanisms are deeply inadequate.
Weak governance structures and reluctance to enforce consequences allow the procurement system to be continuously hijacked. Funds intended for public benefit flow into private hands through tender manipulation. The repetition across years demonstrates that those responsible face no meaningful deterrence.
8, 9, 10. Lekwa-Teemane, Maquassi Hills, and Ratlou Local Municipalities (North West)
These three North West municipalities represent the pinnacle of institutional collapse. All three received Disclaimed Audit Opinions in the 2022-2023 financial cycle—the worst possible outcome. Record-keeping deteriorated so badly that auditors could not express any opinion on financial statement reliability.
This clustering of maximum audit failure reveals a concentrated provincial crisis. North West Province exhibits the lowest average governance scores nationwide, with approximately 40 percent of local municipalities requiring mandatory provincial administration. The problems stem from inadequate capacity, chronic skills shortages, and entrenched non-compliance. This creates a permissive environment where corruption flourishes unchecked. Other North West municipalities such as Tswaing and Mahikeng are widely recognized as “crippled by fraud, corruption and poor service delivery.”
The financial data for major metros illustrates the severity:
City of Tshwane (Gauteng): R3.8 billion irregular, R423 million unauthorized, R140 million fruitless and wasteful
eThekwini (KwaZulu-Natal): R2.4 billion irregular, zero unauthorized, R579,000 fruitless and wasteful
Buffalo City (Eastern Cape): R1.7 billion irregular, zero unauthorized, R53,713 fruitless and wasteful
City of Johannesburg (Gauteng): R811 million irregular, R1.29 billion unauthorized, R8.4 million fruitless and wasteful
Mangaung (Free State): R198 million irregular, R1.19 billion unauthorized, R140 million fruitless and wasteful
Conclusion
The evidence confirms that the most corrupt municipalities in South Africa exhibit one of two critical failures: total institutional collapse, shown through perpetual Disclaimed or Adverse audit opinions (Maluti-a-Phofung, the North West trio), or massive systemic financial capture evidenced by billions in irregular expenditure (eThekwini, Tshwane). Both scenarios produce the same result—public funds are stolen or wasted, and residents lose essential services.
The solution requires closing the accountability gap. Political leadership must demonstrate absolute will to enforce consequences. Human resources policies need reform to prevent the revolving door of corrupt officials. Only when those who commit corruption face certain punishment will the culture of impunity break.
Citizens can demand this change. Staying informed about local audit outcomes, actively reporting irregularities, and supporting anti-corruption institutions like the Auditor-General and Special Investigating Unit are not passive civic duties. They are essential defensive acts for democracy itself. The financial and environmental wellbeing of South Africa’s cities and towns depends on collective vigilance. Contact civil society organizations to report malfeasance. Hold local representatives accountable. The system will not fix itself.