South African municipalities spent R1.61 billion on financial consultants during the 2024/25 fiscal year [1].

This spending highlights a critical gap in internal governance and financial management. As local governments face worsening fiscal distress, the reliance on expensive external consultants suggests a failure to build sustainable internal capacity, potentially deepening the financial instability of these institutions.

Auditor-General Tsakani Maluleke said these expenditures occur amid deepening financial risks and failures in financial discipline [2, 3]. Maluleke said that while some audit gains have been made, the overall fiscal position of many municipalities remains weak [3].

Poor governance and weak fiscal positions have driven the surge in consultant hiring [2, 3]. Instead of resolving the root causes of instability, the use of these services has become a recurring cost for municipalities nationwide, including those in the Gauteng province [1, 3].

Funzi Ngobeni, the ActionSA Gauteng Provincial Chairperson, said he has concerns regarding the management of these funds in the region [3]. The pattern of spending indicates that municipalities are paying for expertise they should possess internally to ensure basic service delivery and financial health.

The Auditor-General's findings emphasize that the current trajectory of financial discipline is unsustainable [2]. The cost of these consultants adds further pressure to budgets that are already strained by systemic inefficiencies and a lack of oversight [1, 2].

“Municipalities spent R1.61 billion on financial consultants in 2024/25 despite worsening fiscal distress.”

The reliance on external consultants at such a high cost indicates a systemic failure in professional capacity at the local government level. When municipalities spend billions on financial advice while their own fiscal health declines, it suggests that the 'consultancy model' is treating symptoms rather than the cause of governance failure. This creates a cycle of dependency that drains public funds without establishing the permanent internal expertise needed for long-term stability.