Important South African city in severe financial trouble with current liabilities exceeding current assets by R4.7 billion

The City of Matlosana’s current liabilities exceed current assets by R4.67 billion, which places it under severe financial pressure.

This is concerning, as the City of Matlosana plays an important role in the North West province’s economy.

The City of Matlosana is a local municipality within the Dr Kenneth Kaunda District Municipality, in the North West province.

It was established in 2000 through the amalgamation of several towns, and its administrative centre is Klerksdorp.

The municipality has a population of 431,000 people and includes Klerksdorp, Orkney, Stilfontein, Kanana, Khuma, and Hartbeesfontein.

Alongside Rustenburg, the City of Matlosana, and specifically Klerksdorp, is the economic powerhouse of the North West Province.

It is positioned along the N12 treasure route, serving as a transport, logistics, and business hub linking Gauteng with the Northern Cape.

Klerksdorp serves as the primary medical, retail, financial, and educational centre for the commercial district and parts of the northern Free State.

The fertile land in the Matlosana supports robust agricultural activity, with high yields of maize, sorghum, groundnuts, and sunflowers.

It is home to Senwes’ corporate headquarters, one of the largest agricultural diversification corporations in the Southern Hemisphere.

Historically, Klerksdorp was synonymous with the Western Transvaal goldfields. However, in recent years, mining has declined significantly.

The City of Matlosana faces financial challenges

Gerhard Strydom, the DA caucus leader in the City of Matlosana Local Municipality, raised the alarm over the financial situation.

He said that the municipality’s fourth-quarter report for April to June 2026 revealed severe financial pressure.

Current liabilities exceed current assets by R4.67 billion, while outstanding debtors have increased to R12.3 billion.

Creditors stand at R6.47 billion, indicating cash-flow constraints and pressure from unpaid service providers.

Outstanding debt has reached R12.3 billion, while the municipality’s collection rate sits at 65%. This created an unsustainable financial situation.

“Despite billing R4.7 billion in revenue, Matlosana is failing to convert a significant portion of that billing into cash,” Strydom said.

“When a municipality cannot collect the money owed to it, it cannot reliably maintain infrastructure, pay service providers, or deliver basic services.”

He said residents and businesses ultimately pay the price in the form of deteriorating services and infrastructure.

He has called for revenue recovery, stronger financial controls, and consequence management to protect basic service delivery.

“Matlosana residents cannot continue paying more while getting less. The municipality needs decisive financial intervention,” Strydom said.

“It also needs accountability and competent management before its financial crisis causes greater damage to essential service delivery.”