The National Treasury has said that it may cut funding toJohannesburg – but could this be a front in an internal African National Congress (ANC) war?

The threat of funding cuts comes after Finance Minister Enoch Godongwana had warned the city about its reckless spending.

In April, Godongwana wrote to Johannesburg’s Mayor Dada Morero with an ultimatum: scrap a R10.3 billion wage deal the city had signed with the South African Municipal Workers’ Union (Samwu), or lose R8 billion in National Treasury grants. The letter laid bare a city in severe financial distress: R25.2 billion owed to creditors, R3.9 billion in cash, R22 billion in irregular expenditure, and an unfunded budget.

Godongwana called the wage agreement the city had signed with Samwu “illegal” and said it had the potential to “destroy the sustainability of the City of Johannesburg beyond this term of office”. Despite this, in May, the ANC-Economic Freedom Fighters (EFF) governing coalition pushed through a R97.1 billion budget, despite warnings that it was unfunded.

The National Treasury may now use Section 216(2) of the Constitution (which empowers Treasury to halt grants to any organ of state in serious breach) to cut funding to Johannesburg.

ANC Civil War

However, the funding cuts may be part of a broader move by the national ANC to undermine the Gauteng ANC, which has always been one of the more rebellious provinces.

Gauteng was one of the first provinces that rebelled against Jacob Zuma and it does not always follow the path of the party under leader Cyril Ramaphosa. It is also hostile to the Democratic Alliance (DA), more so than the national ANC and the party’s branches in other provinces. After the 2024 elections, the national ANC signed a coalition agreement with the DA to form the Government of National Unity (GNU) and also went into coalition with the DA in KwaZulu-Natal. However, the Gauteng ANC went the other way, freezing the DA out of provincial government and working with the EFF in the province’s metros, with Gauteng Premier Panyaza Lesufi being openly hostile to the DA.

What This Is Really About

Godongwana’s move disciplines a consistently rebellious province and undermines Lesufi’s leadership. It would also halt any potentially brewing alignment between the Gauteng ANC, the EFF, and the uMkhonto weSizwe Party in that province, paving the way for the coalition Ramaphosa’s government needs Johannesburg to produce.

The DA is leading the ANC in Johannesburg, polling at 39% of the vote, against the ANC’s 30%, meaning that the only real viable and stable coalition in Johannesburg is one between the two parties that anchor the GNU – the ANC and the DA.

For the national ANC, an ANC-DA deal in Johannesburg after the local government elections in November would validate and entrench the GNU.

Luthuli House has decided Johannesburg is too important to leave to the Gauteng ANC.