Tshwane’s financial outlook upgraded by Moody’s amid political divide

The City of Tshwane MMC of finance Jacqui Uys has welcomed the decision by Moody’s Ratings to retain the city’s ratings status and upgrade its financial outlook from negative to stable.

“Moody’s has confirmed the city’s Caa2 long-term issuer rating and its Caa2 BCA and its Caa1.za NSR long-term issuer rating. This is a positive development that will assist the city as we work to stabilise our finances,” she said.

City working to rebuild tax administration

Uys said the city was working to rebuild its tax administration to achieve further upgrades, which will enable access to capital funding for infrastructure projects.

“Moody’s ascribes the city’s stable outlook rating as a reflection of the city’s decreased risk of debt acceleration.

“The rating also follows our submission of our audited financial statements to the Johannesburg Stock Exchange.

“This was further supported by a Sens statement,” she added.

Driver of investors

Political expert Dr Benjamin Rapanyane said the combination of the improved 2023 audit report and the stable outlook will serve as the foremost fundamental driver of investors into the city.

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However councillor of the Republican Conference of Tshwane Lex Middelburg disagreed, saying there were no financial results to back up the report.

“Far from this report being the inflection point in the financial outcomes of this city as the coalition claims it to be, the positive financial results are simply not there to back it up.

“Fruitless and wasteful expenditure is over R1 billion, irregular spending is up to R1.5 billion. We added a whopping R 1.7 billion to the unpaid invoiced creditors at the end of the year, more than what was left unpaid the year before.

“The total current creditors left unpaid this year now stands at about R14 billion,” he said.

Not sustainable

Middleburg said it meant creditors will be paid from this year’s budget instead of it being used to meet budgeted objectives.

“This is not sustainable,” he added.

Middelburg said all the city’s ratios were bad or have deteriorated.

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