Joburg ratings upgrade will have no impact on the poor

16 May 2016

Mayor Parks Tau’s attempt to hide the fact that the City of Johannesburg’s finances continue to be in a mess is completely disingenuous.  

The truth is that the recent Moody’s credit rating of Johannesburg, while welcomed, is basically a measure of a city’s cash flow, and whether it is able to pay its creditors. 

The real story, however, is that the city’s financial management is in a shambles.  Just last week the city’s finance portfolio committee decided to write off just over R8,4 billion in old debt.

That is the total cost of building just over 80 000 houses. 

Furthermore, just recently Ratings Afrika’s Municipal Financial Stability Index scored the city a dismal 37 out of a possible 100. 

 According to the agency, the low score came as a result of the city’s deficiencies in its budgetary practices and financial discipline.

Where the DA governs municipal finances are managed stringently, and we deliver the biggest basket of free services to the poor. It therefore comes as no surprise that the City of Cape Town scored 75 out of 100 on the same index. 

The fact of the matter is that Mayor Parks Tau’s administration is unable to manage the city’s finances in such a way so as to improve the living conditions of the poorest of the poor. More access to credit won’t change bad governance that doesn’t deliver to the poor.

On 3 August Johannesburg’s residents can change this by voting DA for change. Change that delivers better services, change that creates jobs, and change that builds a better South Africa.

Issued by Willie Venter on behalf of Herman Mashaba, 16 May 2016