City Of Johannesburg Unveils R89 Billion Budget Plan for 2025/26 Financial Year

The City of Johannesburg has rolled out the bold R89 billion budget plan for the 2025/26 financial year, aiming to fix service delivery shortfalls, upgrade essential infrastructure, and strengthen support for the city’s most vulnerable residents. Finance MMC Margaret Arnolds delivered the budget speech at the Connie Bapela Council Chambers in Braamfontein on 28 May 2025.

Arnolds announced that the city’s operating revenue is set to reach R84.8 billion—up 9.3% from the previous year. This growth stems largely from increased service charges, particularly for electricity and water, which remain the city’s primary revenue sources.

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Electricity and Water Tariffs Fuel Revenue Growth

Johannesburg projects R25.6 billion in electricity service charges, reflecting a 12.5% rise. This follows the 12.41% electricity tariff increase, passed through from Eskom. Beyond revenue growth, the city plans to reduce electricity losses—from 28% to 25.8%—by targeting technical inefficiencies and illegal connections.

Water and wastewater services will bring in about R20 billion, up 11.8% year-on-year. Despite Rand Water’s 15.3% increase, the city has capped its own average tariff hike at 13.9% to soften the impact on consumers.

Other key revenue streams include:

• Refuse removal: R3.3 billion (up 6.4%)
• Property rates: R18.1 billion (up 4.6%), making it the second-largest income source

Despite historic challenges in collecting payments, Arnolds assured residents that this budget is fully funded and financially sustainable.

Key Investments: Power, Water, Roads, and Safety

The budget plan outlines targeted investments in Johannesburg’s most pressing infrastructure needs:

• City Power will receive R4.6 billion over three years to stabilise the grid, expand capacity, and curb electricity losses. The investment seeks to prevent blackouts and accommodate rising demand.
• Johannesburg Water gets the second-largest capital injection at R5.6 billion. Funds will address service backlogs and upgrade infrastructure, including new sewer connections in informal settlements and densely populated townships.
• Roads and Mobility projects will benefit from R2.8 billion directed at upgrading key corridors connecting townships like Diepsloot, Soweto, and Lenasia to major economic centres.
• Stormwater infrastructure improvements in flood-prone areas such as Orange Farm, Ivory Park, and Braamfischerville will receive R400 million to mitigate flash floods.
• Public safety will be enhanced through an R16 million investment in the Johannesburg Metro Police Department (JMPD), which is aimed at fighting crime using modern technology.

A Budget for the People

Arnolds described the budget as both “balanced” and “pro-poor,” reflecting the city’s commitment to equity and inclusion. One of its core features is the expansion of the Expanded Social Package (ESP) to reach more vulnerable residents.

Key support measures include:

• Free basic services: Every household receives 6 kiloliters of water monthly at no charge.
• ESP benefits: Qualifying residents get up to 15 kiloliters of water, 50 kWh of electricity, and free sanitation and refuse removal.
• Senior citizens: Pensioners with properties valued at R2.5 million or less qualify for rates rebates of up to 100%.
• Targeted relief: Indigent households, child-headed families, people with disabilities, and unemployed residents benefit from subsidies on housing, transport, and basic services.

To protect low-income residents from rising energy costs, the prepaid electricity surcharge will remain fixed at R200 (excluding VAT).

“This budget plan makes it clear: we will not govern in a way that reproduces inequality,” Arnolds said. “Our pro-poor programme is a political choice rooted in equity, dignity, and redress.”

Efficiency and Maintenance Come First

Employee costs remain the city’s largest expenditure, reflecting a 5.35% salary increase under the Multi-Year Collective Bargaining Agreement. However, Arnolds made it clear that the city will cut back on outsourcing. Contracted services and professional fees will grow only marginally to avoid unnecessary spending.

Instead, Johannesburg plans to boost its internal capabilities and increase its focus on proactive maintenance. Spending on infrastructure repairs has been ringfenced, ensuring the city addresses its aging assets before problems escalate.

Building a Better Johannesburg

With this budget, the City of Johannesburg has laid a solid foundation for a more functional, equitable, and resilient urban environment. Strategic investment in electricity, water, roads, and public safety—combined with a clear commitment to social justice—signals a new chapter for South Africa’s economic hub.

If the city delivers on its promises, Joburg residents can look forward to a future where basic services are reliable, infrastructure is modernised, and no one is left behind.