The Gautrain remains a flagship example of a successful Public-Private Partnership (PPP) in Gauteng and one of the largest transport PPP projects undertaken on the African continent.

Speaking during the 2026/27 Gauteng Provincial Legislature address on Tuesday, Gauteng MEC for Finance and Economic Development Lebogang Maile said infrastructure development remains essential for economic growth and job creation, but government alone cannot meet the scale of investment required to modernise and expand provincial infrastructure.

According to Maile, economic projections for the medium-term point to steady recovery with provincial economic growth expected to reach 2.1% in 2026, significantly above the national average.

“In a constrained fiscal environment, it is crucial that we embrace innovative financing and delivery models that allow us to leverage the strengths of both the public and private sectors,” Maile said.

He noted that PPPs remain a critical instrument in accelerating infrastructure development by enabling government to mobilise private sector expertise, technology and capital while ensuring value for money and the efficient delivery of projects.

Maile added that greater priority should be placed on PPPs that are revenue-generating or financially self-sustaining, as these allow meaningful private sector participation while generating returns and easing pressure on public finances.

He also welcomed reforms introduced by National Treasury through amendments to Treasury Regulation 16, which came into effect in June 2025.

Municipal PPP regulations are expected to be finalised by June 30, 2026, which will enable local governments to participate more effectively in infrastructure partnerships.

“These reforms aim to streamline and strengthen the PPP framework, improve project preparation and governance, and unlock greater private sector participation in infrastructure development,” he said.

Maile said Gauteng is aligning its infrastructure delivery programmes with the strengthened regulatory framework to accelerate the preparation and financing of priority projects while safeguarding public interests through proper risk allocation, affordability and accountability.

Referring to the Gautrain, Maile said the current concession agreement will conclude in March 2026, with the province already advancing the procurement process to appoint a new concessionaire to operate, maintain and modernise the system under a renewed PPP arrangement.

“This initiative aims to turn the Gautrain into a fully paid-up state asset valued at approximately R45 billion, positioning the province to maximise the long-term economic and mobility benefits of this strategic investment,” he said.

He added that the post-2026 concession will ensure service continuity, strengthen the operational sustainability of the system and enhance private sector participation while delivering value for money for residents.

“Beyond the Gautrain, we will continue to explore opportunities to expand the use of Public-Private Partnerships in other strategic infrastructure sectors, including transport, tourism, water, energy, digital infrastructure and environmental services, as part of our broader strategy to unlock investment and stimulate economic growth,” said Maile.

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Gauteng municipalities were owed R165.7 billion by residents, businesses and state entities by the end of December, the province’s treasury said on Sunday.

It also said that municipal councillors and officials collectively owed municipalities about R165.7 million as at 31 December 2025, with the largest balances in Johannesburg (R74.8 million), Tshwane (R36.2 million) and Ekurhuleni (R22.9 million).

Gauteng Finance and Economic Development MEC Lebogang Maile said formal correspondence had been issued to enforce recovery measures and ensure compliance.

He said households accounted for 73.3% of outstanding debt, commercial customers 23.2%, and organs of state 3%.

Weak implementation of credit control policies contributes to the growing debtor burden and constrains municipalities’ ability to meet obligations when they fall due, he said in a statement.

Municipalities also reported outstanding creditors of R37.9 billion as at 31 December 2025, down from R53.2 billion in November.

The City of Tshwane is driving much of the improvement after reducing its creditors to R5.7 billion from R18.3 billion, Maile said.

Bulk electricity accounted for 53.7% of the aggregated creditor balance, followed by trade creditors at 30%.

Maile said the Gauteng Provincial Government owed municipalities R2 billion at the end of December, after payments of R101.7 million against total billings of R2.19 billion.

The outstanding provincial debt is largely concentrated in the three metropolitan municipalities — the City of Johannesburg, Tshwane and the City of Ekurhuleni — with the departments of Infrastructure Development (51%), Education (33%) and Health (12%) the main drivers, he said.

The figures are contained in the consolidated quarterly state of municipal finance report covering the first half of the 2025/26 financial year, which ended on 31 December 2025.

Maile said the publication of the report formed part of a broader effort to improve transparency and inform the public about how municipal financial performance affects service delivery.

Maile said the Gauteng Provincial Treasury compiles the consolidated quarterly statement on the state of municipal budgets and submits it to the Gauteng Provincial Legislature in line with Section 71(7) of the Municipal Finance Management Act.

At the start of the municipal financial year on 1 July 2025, Gauteng municipalities adopted a consolidated operating revenue budget of R229.1 billion and operating expenditure of R222.2 billion, resulting in a projected operating surplus of R6.9 billion, he said.

By the end of December, municipalities had generated R123.3 billion in operating revenue, representing 53.9% of the annual budget and 3.9 percentage points above the 50% straight-line estimate.

The metropolitan municipalities were the primary contributors, with Johannesburg contributing R48.5 billion, Ekurhuleni R34.5 billion and Tshwane R27.6 billion, Maile said.

Operating expenditure during the same period amounted to R109.2 billion, or 49.2% of the annual budget, again driven largely by the metros.

As a result, most municipalities were functioning within their adopted budgets during the first half of the year, but accumulated operating deficits were reported by Johannesburg, Lesedi Local Municipality, Merafong City Local Municipality and Rand West City Local Municipality.

Maile said the collection rate for the majority of Gauteng municipalities as at the end of December was R30.1 billion, or 116%, above the 95% collection norm set out in National Treasury’s MFMA Circular 71. Collection measures can exceed 100% when municipalities recover arrears in addition to current billings, but he said Johannesburg, Emfuleni Local Municipality, Lesedi and Merafong were below the expected 95% norm.

On capital spending, municipalities approved an aggregated capital expenditure budget of R16.2 billion for 2025/26, up from R14.9 billion the previous year — an increase of nearly R1.3 billion, or about 8%.

The programme is funded mainly through national conditional grants allocated via the Division of Revenue framework, representing national grants of 55% (R8.9 billion), provincial allocations of 8% (R1.4 billion), borrowings of 22% (R3.5 billion), and internally generated funds of 15% (R2.4 billion), Maile said.

As at 31 December, capital spending amounted to R5.4 billion, or 34% of the annual budget. While that is below the 50% straight-line level, Maile said historical trends suggest municipalities are likely to achieve at least 85% of budgeted capital spending by year-end, with Rand West City the exception after spending 68% by midyear.

Grant performance varied.

The Municipal Infrastructure Grant averaged 62%, with Lesedi at 89%. The Integrated Urban Development Grant applied only to Mogale City, which reported spending of 52%.

The Water Services Infrastructure Grant averaged 46%, with Mogale City Local Municipality the highest-performing municipality at 59%, while Merafong and Lesedi were below the required 40% at 39% and 32% respectively.

The Urban Settlements Development Grant, which applies to metropolitan municipalities, recorded average spending of 23%.

The Public Transport Network Grant averaged 21%, with Maile warning that none of the recipient municipalities had spent above 40% and that poor performance raised the risk of reduced allocations under the Division of Revenue Act framework.

Maile said MFMA Circular 130, developed with provincial treasuries, advises municipalities to prioritise renewal of ageing infrastructure and strengthen repairs and maintenance budgeting to prevent disruptions.

He said the Gauteng Provincial Treasury has also issued a practice note to support effective pre-planning so municipalities can optimise the use of allocated funds.

Maile said the province was also intensifying targeted support through a strategic supply chain management approach aimed at improving procurement planning, accelerating capital expenditure and infrastructure delivery, and reducing unauthorised, irregular, fruitless and wasteful expenditure through strengthened preventative controls.

He said three municipalities — Ekurhuleni, Midvaal Local Municipality and Mogale City — were able to pay suppliers within 30 days during the period, while Sedibeng still had a balance of over 90 days.

Maile said five Gauteng municipalities participate in the Eskom Debt Relief Programme: Emfuleni, Lesedi, Mogale City, Rand West City and Merafong City.

The 36-month programme runs to 2027 and is tied to compliance with conditions in MFMA Circular 124, he said.

Rand West City received a first write-off of R279.7 million from ring-fenced debt of R839.7 million after meeting conditions, Maile said.

Emfuleni and Mogale City were granted their first one-third write-offs on 16 December 2024 and 20 February 2025, amounting to R1.9 billion and R72.1 million respectively.

All participating municipalities are awaiting National Treasury approval for a second write-off, he said, while Lesedi and Merafong City are awaiting final assessments to determine whether they qualify for write-offs.

Maile added that Emfuleni signed a distribution agency agreement with Eskom and entered into a special purpose vehicle agreement with Rand Water Services as part of debt management measures.

Maile said the province would intensify support through its Municipal Finance Hands-On Support Programme, under which 10 municipal advisors provide technical support to selected municipalities, and through the Debt Management Committee. Since the committee’s establishment in the 2017/18 financial year, municipalities have received a cumulative R21.04 billion in payments from the Gauteng provincial government, he said.

“These interventions are aimed at strengthening governance, restoring financial sustainability, and ensuring that municipal resources are used efficiently to improve service delivery to communities,” he said.

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The Democratic Alliance (DA) has welcomed a R275 million allocation announced on Tuesday by Gauteng MEC for Finance and Economic Development, Lebogang Maile, to tackle the ongoing hospital linen crisis across the province.

The adjustment will fund the urgent procurement of new hospital linen, mattresses, and beds, offering much-needed relief to overburdened facilities and addressing a chronic problem that has plagued Gauteng’s public health system for years.

The crisis dates back to at least 2022 but intensified in 2024 and 2025 due to repeated breakdowns of ageing laundry infrastructure, unpaid supplier debts totalling R743 million to 69 providers, and broader financial mismanagement in the Gauteng Department of Health.

Facilities such as Chris Hani Baragwanath Academic Hospital (CHBAH) — Africa’s largest, with more than 3,200 beds — and Charlotte Maxeke Johannesburg Academic Hospital have been among the hardest hit. At times, soiled linen has piled up in corridors, relatives have been forced to bring their own bedding, and non-emergency surgeries have been cancelled.

Provincial laundries like Dunswart and Masakhane have operated at sharply reduced capacity, in some cases with only one functional washer serving 14 hospitals and 54 clinics, deepening shortages across the province.

These failures have not only undermined patient dignity but have also contributed to a spike in hospital-acquired infections (HAIs). In 2024 alone, 7,743 HAIs were reported across Gauteng — many of them antibiotic-resistant and linked to reused bedding, inadequate cleaning supplies, overcrowding and staff shortages.

Charlotte Maxeke recorded the highest rate at 11% (1,473 out of 12,940 patients), while CHBAH reported 1,796 HAIs among 31,985 admissions in the previous year. Health experts warn that such conditions extend hospital stays, increase mortality risks and place further pressure on an already overstretched system serving millions in South Africa’s economic hub.

The latest intervention follows the DA’s high-profile exposure of the shortages, particularly at CHBAH in Soweto, where patients have slept on bare plastic liners and been forced to improvise with blankets or even pyjamas as makeshift sheets.

DA Gauteng health spokesperson Jack Bloom said the department had initially downplayed the problem, but “written replies now confirm that 870 beds at Bara had no full set of linen, even though each bed requires at least five sets to maintain hygiene and prevent infections”.

In a related statement, the Gauteng Department of Health (GDoH) reaffirmed its target of providing at least five full sets of linen per hospital bed, allowing for rotation through usage, laundering, storage and transport.

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Gauteng finance MEC Lebogang Maile has raised concerns regarding the municipal audit outcomes for the 2022/23 financial year. 

Addressing a two-day Local Government Turnaround Summit in Johannesburg, Maile said that out of the 11 municipalities in the province, only seven received unqualified audit opinions.

The summit was opened by provincial cooperative governance and traditional affairs (Cogta) MEC Jacob Mamabolo, and featured addresses by Gauteng premier Panyaza Lesufi and COGTA Deputy Minister Dickson Masemola.

It was also attended by leaders from municipalities across Gauteng, as well as experts from academia and the private sector.

Maile raised particular concerns over the City of Ekurhuleni’s regression from a clean audit to an unqualified opinion, with findings primarily due to non-compliance issues. 

Mogale City and Emfuleni local municipalities, while addressing specific matters that led to prior-year qualifications, encountered new qualification issues, causing them to stagnate with qualified audit opinions.

Merafong City Local Municipality, on the other hand, remained a key area of concern, continuing to receive a disclaimed audit opinion. 

This outcome stemmed from poor record management and weaknesses in the municipality’s overall control environment, said Maile.

“For the current audit cycle, the Gauteng Provincial Treasury performed technical reviews before submission to the office of the Auditor-General. These efforts were recognised and highly appreciated by the AGSA as an attempt to instill a culture shift towards achieving good governance,” said Maile.

“During the audit process, the provincial treasury will be attending municipalities’ audit steering committee meetings to support municipalities in technical interpretations and consistent application of standards. Post the audit process, we will support municipalities in developing their audit action plans as per Section 131 of the MFMA to address the current year audit findings.”

Maile said that in a bid to support and strengthen the capacity of municipalities to manage their own affairs, the provincial treasury has appointed 10 technical advisors to provide firsthand assistance to district and local municipalities. 

These advisors will offer expertise across various aspects of municipal financial management, including the implementation of Financial Recovery Plans for municipalities under provincial intervention. 

This initiative is part of the provincial treasury’s Hands-on Support Programme. It is aimed at addressing capacity challenges, improving financial management and enhancing reporting standards within local government, according to Maile.

“To strengthen intergovernmental relations, I regularly meet and engage with the MMCs for finance in municipalities to discuss the root causes and remedial actions plans for any persistent breach of the MFMA and its related regulations,” said Maile.

“This work would be monitored on a regular basis to ensure that all resolutions taken at these engagements are fully implemented. The Gauteng Provincial Treasury remains deeply committed to ensuring that we strengthen the governance and financial management of our municipalities in order that they may be able to serve our communities.”

Maile further told the summit that as of 31 July 2024, the total outstanding debt owed to municipalities in Gauteng has surged to R132,532 billion. 

He said this debt was owed by households, commercial entities and organs of state. 

Households accounts owed the largest portion at R99,343 billion, while commercial entities owe R27,886 billion. Organs of state owe R3,730 billion.

He further pointed out that in comparison, the outstanding debt in June 2024 stood at R12,073 billion, adding that the increase of over R5 billion in just 30 days highlighted a troubling trend in debt growth on a month-to-month basis. 

“Our municipalities are struggling to collect revenue, and this is a serious cause for concern,” he said.

Maile further revealed that as of 31 July 2024, the total outstanding creditors owed by municipalities stood at R27,098 billion. 

This debt is primarily owed to Eskom, Rand Water and other service providers for services rendered but not yet paid. 

Eskom is owed R19,650 billion, while Rand Water is owed R2410 billion.

He said only 31.6% of this balance related to current accounts – those outstanding for than 30 days. 

The remaining 68.4% is in violation of Section 65(2)(e) of the Municipal Finance Management Act, indicating severe non-compliance.

“This demonstrates not only poor financial controls and governance, but it also poses a very serious threat to economic and social development within our communities,” he said. 

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Gauteng finance and economic development MEC Lebogang Maile has cautiously praised the performance of the province’s metros, but believes that more needs to be done to ensure all-round improvement.

Maile briefed the media at the Gauteng legislature on Thursday on the audit outcomes of municipalities across the province during the 2022/2023 financial year.

In relation to performance reports, Maile said the quality of submitted performance reports improved from 50% to 54% and residents were engaged during public participation sessions in setting priorities.

He said that in some instances the related performance targets were then either revised or not prioritised, resulting in communities not receiving the desired services.

By not achieving targets, this further affected the adequacy of basic services delivered to communities.

Maile said that despite the inclusion of the National Treasury’s common performance indicators in the performance reports, greater urgency was required from accounting officers, mayors and MMCs to address service delivery challenges.

Internal audit units and audit committees should intensify their quarterly assessment of performance information, and council oversight committees should hold executive leadership accountable for the implementation of service delivery plans.

Maile confirmed that the intervention envisioned by the provincial government was not dependent on the political composition of metros, in light of the recent inter-party battles in Tshwane, Johannesburg and Ekurhuleni.

“We are not in control of the political situation [and] if the parties decide to fight each other we are not in control of that, but we are definitely focusing on the job. It must be understood the provincial government doesn’t run municipalities, we don’t want to run municipalities,” he said.

The MEC indicated that these reports underscored the need for improved governance and management practices to enhance service delivery and financial accountability in Gauteng’s municipalities.

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