City of Johannesburg's R89.4 billion budget: Prioritising economic growth and support for vulnerable communities

City of Johannesburg Finance MMC Margaret Arnolds on Wednesday tabled the municipality’s 2025/26 budget of R89.4 billion, which is fully funded.

For the 2025/26 financial year, the City of Johannesburg presented operating revenue of R84.8bn, operating expenditure of R80.7bn, and R4.1bn in a projected surplus before taxation and capital grants.

The capital budget is R8.7bn and will total R26.2bn over the medium term, according to Arnolds.

She said the key revenue drivers of the total budget of R89.4bn for the 2025/26 financial year are electricity (R25.6bn), water and wastewater (R20bn), property rates (R18.1bn), refuse removal (R3.3bn), and the national fuel levy allocation (R4.57bn) from the National Treasury will increase by 10.8%.

Revenue is projected to increase by 9.3% in 2025/26 compared to the previous financial year, and this is primarily driven by service charges, which account for the largest share of the city’s revenue base.

Electricity service charges are budgeted at R25.6bn, up by 12.5%, reflecting the approved tariff increase of 12.41%, which is passed through from Eskom.

The municipality also has a focused plan to reduce technical and non-technical electricity losses from 28% to 25.8%. Water and wastewater charges will generate about R20bn, up by 11.8%, which is underpinned by an average tariff increase capped at 13.9%, despite Rand Water’s increase of 15.3%.

Refuse removal revenue increases by 6.4% to R3.3bn, with service reliability a core deliverable tied to the tariff increase of 6.6% while property rates, which are the city's second-largest revenue stream, are expected to generate R18.1bn, an increase of 4.6%.

Arnolds said the increase remains below consumer price inflation in recognition of the economic stress many households and businesses are facing.

“This is a fully funded, pro-poor and pro-growth budget – an instrument of transformation, and a roadmap to resilience,” Arnolds added.

She said the City of Joburg’s 2025/26 budget is being tabled against a backdrop of persistent economic challenges, both nationally and locally.

“South Africa’s economic recovery remains uneven, with structural constraints such as high unemployment, weak investment levels, and persistent load shedding continuing to weigh on growth prospects,” Arnolds explained.

She said Johannesburg is not just another municipality but is South Africa’s economic engine, as the city contributes 15% to the national gross domestic product (GDP) and 44% to Gauteng’s GDP.

“When Johannesburg thrives, South Africa moves forward,” said Arnolds.

According to Arnolds, the administration led by Mayor Dada Morero unapologetically centres the indigent and working class in its budget through the continuation of a robust expanded social package (ESP).

“This is not charity – it is justice. In this budget, all residents will continue to receive the first six kilolitres of water for free,” she said.

Arnolds added that ESP qualifying residents receive up to 15 kilolitres of free water, 50 kilowatt-hours of free electricity, free sanitation, and refuse removal.

She said this was because in Johannesburg, the municipality believes that basic services are a human right, not a privilege.

“Pensioners – who built this city with their labour – receive up to 100% rates rebates on homes valued up to R2.5 million. Indigent households, child-headed families, people living with disabilities, and the unemployed are supported through targeted rebates and subsidies on municipal services, housing, and transport,” Arnolds said.

She said the City of Joburg refuses to allow economic pressure to push residents further into the margins of society, hence the controversial prepaid electricity surcharge will remain unchanged at R200 (excluding value-added tax), which is a deliberate act to protect the poor against rising energy costs.

“This budget makes it clear: we will not govern in a way that reproduces inequality. Our pro-poor programme is a political choice, rooted in the values of equity, dignity, and redress. It is a signal that in the City of Johannesburg, no one will be left behind. Not on our watch,” stated Arnolds.

loyiso.sidimba@inl.co.za