Losi argues that withholding funding will not resolve governance failures
She urges government to focus on improving governance instead of reducing funding to municipalities
Dive Deeper
Cosatu president Zingiswa Losi has criticised National Treasury’s decision to withhold funding from struggling municipalities, saying the move would deepen the local government crisis instead of fixing it.
Speaking on Thursday, Losi said reducing funding to municipalities already battling financial distress was equivalent to “cutting blood” or “cutting oxygen” from a body that was trying to survive.
Her remarks come after National Treasury announced that it would withhold equitable share allocations from dozens of municipalities over governance and financial management failures.
‘Ordinary residents to suffer’
Losi said the consequences of the decision would be borne by ordinary residents who depend on municipalities for water, electricity, sanitation and other basic services.
“We do not agree with the decision of Treasury in the manner that it has been done,” she said.
“How do you expect municipal workers to continue to wake up in the morning, go to work and service communities when the very same municipalities are underfunded? They are cutting funding. That’s literally like cutting blood when the body needs it. It’s like cutting oxygen when the body needs it.”
Cuts will undermine service delivery
She said the funding cuts would not only affect municipal employees but would ultimately undermine service delivery.
Losi said many municipalities were already unable to meet their financial obligations, with some workers reporting for duty despite not receiving their salaries on time.
She said the crisis facing local government had become a broader societal issue rather than simply a labour dispute.
“We are having local government elections on November 4, and yet we have dysfunctional municipalities,” she said.
“We have workers in municipalities that are not respected. Some are suspended and others are dismissed.”
Losi said municipal employees were part of the communities they served and wanted functioning municipalities as much as residents did.
“Municipal workers are here not only for themselves. They are also representing the interests of the communities that they come from,” she said.
“When you starve municipalities and do not deal with corruption, it is services that are not reaching ordinary poor South Africans.”
‘Prioritise tackling corruption’
She argued that withholding funding would not resolve governance failures and instead risked worsening already fragile municipalities.
“The salary negotiations stop. Municipal workers suffer, and ordinary South Africans who are paying for municipal services are the ones who will be at the receiving end,” she said.
Losi said the government should prioritise tackling corruption and improving governance instead of reducing funding to municipalities.
“Instead of government addressing issues of corruption, you are deciding to cut funding. We don’t think it is a response to the challenges that we are faced with,” she said.
She also suggested that those making the decisions were insulated from the consequences experienced by residents.
“People who are making these decisions may have water tankers at home. They may have solar at home. They may be living in suburbs where these services are already outsourced,” Losi said.
“What about ordinary South Africans who rely on the municipality?”
Summary
Cosatu president Zingiswa Losi condemned National Treasury’s decision to withhold funding from struggling municipalities, warning it would worsen the local government crisis.
Losi emphasized that cutting funding is like “cutting blood” or “oxygen” from municipalities already in financial distress, harming municipal workers and service delivery.
She highlighted that ordinary residents dependent on municipal services such as water, electricity, and sanitation would suffer the most from these funding cuts.
Losi urged the government to focus on fighting corruption and improving governance rather than reducing municipal funding.
She noted that decision-makers might be disconnected from the harsh realities faced by ordinary South Africans relying on municipal services.
Listen
🎧 Listen to this article
Cosatu president Zingiswa Losi has criticised National Treasury’s decision to withhold funding from struggling municipalities, saying the move would deepen the local government crisis instead of fixing it.
Speaking on Thursday, Losi said reducing funding to municipalities already battling financial distress was equivalent to “cutting blood” or “cutting oxygen” from a body that was trying to survive.
Her remarks come after National Treasury announced that it would withhold equitable share allocations from dozens of municipalities over governance and financial management failures.
Losi said the consequences of the decision would be borne by ordinary residents who depend on municipalities for water, electricity, sanitation and other basic services.
“We do not agree with the decision of Treasury in the manner that it has been done,” she said.
“How do you expect municipal workers to continue to wake up in the morning, go to work and service communities when the very same municipalities are underfunded? They are cutting funding. That’s literally like cutting blood when the body needs it. It’s like cutting oxygen when the body needs it.”
She said the funding cuts would not only affect municipal employees but would ultimately undermine service delivery.
Losi said many municipalities were already unable to meet their financial obligations, with some workers reporting for duty despite not receiving their salaries on time.
She said the crisis facing local government had become a broader societal issue rather than simply a labour dispute.
“We are having local government elections on November 4, and yet we have dysfunctional municipalities,” she said.
“We have workers in municipalities that are not respected. Some are suspended and others are dismissed.”
Losi said municipal employees were part of the communities they served and wanted functioning municipalities as much as residents did.
“Municipal workers are here not only for themselves. They are also representing the interests of the communities that they come from,” she said.
“When you starve municipalities and do not deal with corruption, it is services that are not reaching ordinary poor South Africans.”
She argued that withholding funding would not resolve governance failures and instead risked worsening already fragile municipalities.
“The salary negotiations stop. Municipal workers suffer, and ordinary South Africans who are paying for municipal services are the ones who will be at the receiving end,” she said.
Losi said the government should prioritise tackling corruption and improving governance instead of reducing funding to municipalities.
“Instead of government addressing issues of corruption, you are deciding to cut funding. We don’t think it is a response to the challenges that we are faced with,” she said.
She also suggested that those making the decisions were insulated from the consequences experienced by residents.
“People who are making these decisions may have water tankers at home. They may have solar at home. They may be living in suburbs where these services are already outsourced,” Losi said.
“What about ordinary South Africans who rely on the municipality?”
SAMWU says withholding funds and austerity measures will not solve the crisis and has called on government to address the systemic challenges facing municipalities.
The Union’s General-Secretary Dumisane Magagula, “What needs to change is the funding model of local government. Currently, the model does not speak to service delivery. It doesn’t enable municipality to deliver services. The funding model should not be over-reliant on collecting from residents only. It should go much broader than making sure that we get revenue and correct revenue even from business. kind of budget that goes to municipalities needs to be relevant for those municipalities.”
Meanwhile, SAMWU held a National Day of Action on Thursday to highlight a range of issues affecting municipal and water sector workers, including local government funding, wages, outsourcing and working conditions.
Impendle Municipality, which is one of the poorest municipalities in KwaZulu-Natal, is worried by the National Treasury withholding equitable share grants from poor-performing municipalities Image: x.com
Impendle Municipality, which is one of the smallest rural municipalities in KwaZulu-Natal Midlands, was on Thursday holding its breath, hoping discussions would persuade the National Treasurer to withdraw its decision to withhold equitable share grants from poor-performing municipalities.
The National Treasury revealed on Tuesday that it was temporarily withholding the July 2026 equitable share transfers to certain municipalities to instil fiscal discipline.
Treasury said this is to ensure that public money allocated to the municipalities is properly managed and these municipalities learn to address unauthorised, irregular, fruitless, and wasteful expenditure (UIFWE).
Equitable shares are funds that the National Treasurer unconditionally transfers to provincial and local governments for administrative costs.
The financial status in Impendle, which is among municipalities identified by the National Treasury as financially ill-disciplined, reached a boiling point when it failed to pay staff salaries on time early this year.
Mayor Kho Dlamini stated that the municipality would not survive without equitable shares.
“This is affecting us badly, but there are currently discussions with the National Treasury, which we believe will lead to a certain agreement by 2 pm,” said Dlamini.
He said the grant was important to Impendle, which had scarce rate collection sources.
“Impendle Municipality is mainly grant-dependent,” said Dlamini.
In the statement, the Treasury stated that its decision was meant to hold municipal officials and office-bearers accountable.
“The decision follows persistent and serious non-compliance with the Municipal Finance Management Act (MFMA) and its supporting regulations, despite support provided by the National Treasury through guidance, engagement, and formal or informal communication,” read the statement.
Other municipalities in KwaZulu-Natal, which are affected by the Treasury’s decision, are uMzinyathi, Amajuba, and uMkhanyakude districts, Newcastle, eMadlangeni, and AbaQulusi.
UMkhanyakude Mayor Siphile Mdaka said his municipality was included in the list through miscommunication between it and the Treasury.
“It is a matter that Treasury and us are dealing with (on Friday) in our meeting at 4 pm,” he said.
Mdaka said the municipality had provided reports to the Treasury that there is work in progress in terms of the issues that the municipality is addressing internally.
“But all issues that they (Treasury) have raised have been resolved.
“This is just a communication issue, which is why I am saying we are clarifying this with them tomorrow at 4 pm,” he said.
The Congress of South African Trade Unions (Cosatu) has called for urgent interventions for financially distressed municipalities, as the Treasury’s decision may worsen their situation.
The federation said, although it appreciates the need to install financial discipline in municipalities when it comes to their workers’ salaries and pension funds, Eskom, Water Boards, and other service providers, there would be unintended consequences for withholding the grant.
“Some of these municipalities are so financially cash-strapped that this action may cause some basic services to grind to a halt and leave many municipal workers unpaid once again,” said Cosatu’s parliamentary coordinator Matthew Parks.
Parks called for engagements between Treasury, the Department of Cooperative Governance and Traditional Affairs (COGTA), and the South African Local Government Association (SALGA) “to put in place interventions to resolve these ever-worsening crises”.
Parks said the solution to mishandling municipality finances would be to appoint competent management and deal with corruption and wasteful expenditure through the intervention of the Hawks and the Special Investigating Unit.
“It is key that these interventions do not lead to a further collapse of municipal services or see more workers sent home unpaid,” said Parks.
Woolworths has joined Checkers and Pick n Pay in launching an artificial intelligence (AI)-powered assistant on its on-demand delivery app.
Called ‘My Woolies Chef’, Woolworths’ AI tool will allow customers to ask questions, find meal ideas, plan dishes, and shop for ingredients more seamlessly.
My Woolies Chef will be available to a small group of existing MyDifference loyalty programme members from September 2026 as part of an ongoing beta testing phase. Woolworths intends to roll out the service more broadly in early 2027.
“Unlike general-purpose AI tools, My Woolies Chef is built specifically around the Woolworths food ecosystem,” the retailer said in a press release on 13 July.
“The assistant combines local recipe content, product information and shopping functionality to deliver recommendations that are relevant to the South African customer context and directly connected to the Woolworths shopping experience.”
My Woolies Chef will use generative and conversational AI to interpret customers’ questions and return relevant suggestions.
The AI tool has been trained on thousands of Woolworths TASTE recipes and, unlike a traditional search function, it is designed to understand the context behind a request.
“The system has been trained to interpret natural language prompts related to meal planning, cooking preferences, and household needs,” the retailer explained.
This allows customers to interact with the platform in a more intuitive and conversational way.
“Conversational AI allows customers to engage with Woolworths’ food content and digital shopping experience in a more intuitive way,” Woolworths’ group data and AI officer, Jose Rodrigues, said.
“Instead of navigating multiple searches, they can describe what they need in everyday language and receive suggestions that are relevant to the context of their request.”
“Our focus is on developing the technology responsibly, testing it through a phased rollout and improving the experience through customer feedback.”
South African retailers go all-in on AI
The announcement of My Woolies Chef comes shortly after Pick n Pay and Checkers have launched their own versions of an AI-powered chatbot integrated into their on-demand delivery apps.
Checkers was first to the punch, announcing its AI-powered shopping assistant, named ‘Pixie’, on its Sixty60 delivery platform in April 2026.
Described as a “trusted personal butler with a PhD in shopping”, Checkers’ tool learns from customers’ buying habits and generates personalised grocery baskets and product recommendations.
Pick n Pay responded to Checkers’ move in early July 2026, introducing ‘Penny’, an AI-powered, multimodal shopping assistant on its asap! platform.
Penny can assist asap! users with building shopping baskets, answering questions, and helping with “smart shopping”.
With Woolworths, Pick n Pay, and Checkers now having announced their AI-powered upgrades to their delivery platforms, it is becoming clear that the new retail battleground has shifted to convenience shopping.
All of South Africa’s major retailers have been investing heavily in their on-demand delivery platforms over the past few years, looking to capture more market share through these convenience options.
Currently, Checkers’ Sixty60 platform is the clear market leader and was the first to launch major upgrades that the other market players soon followed.
As South African shoppers increasingly prioritise convenience and the online shopping experience, retailers will need to differentiate themselves through their on-demand platforms.
COSATU said the UIF system has completely collapsed.
Job hunting and unemployment. Picture: Pixabay
Business and labour unions have raised the alarm that the Unemployment Insurance Fund (UIF) system has collapsed and are demanding direct intervention from the Presidency.
Business Unity South Africa (BUSA) formally withdrew its representatives from all UIF structures and the National Economic Development and Labour Council (NEDLAC), citing years of unaddressed maladministration.
He explained that while the fund’s mandate is to provide financial relief to unemployed workers, those on maternity or parental leave, or those injured or deceased on the job, the system is plagued by inefficiencies, corruption, and a lack of transparency.
“When employees register the workers, they struggle with the IT systems. When workers try to apply, they also struggle.
“You go to all the labour centres across the country, and you’ll find queues stretching hundreds of people long. Workers might have to wait three or four days to be assisted.
“The systems are frequently offline. And workers can wait weeks, months, and even years to receive their UIF benefits.”
He added that there have also been cases where officials have submitted fraudulent claims and pocketed the money themselves.
“There is a real crisis, and workers have the right to be irritated and angry because it’s indeed their money and it’s there to assist workers in the moment of need.”
Never miss a major story. Get breaking news and the latest developments from South Africa and beyond as they happen.
Cosatu has presented a crucial submission to the USTR, highlighting the urgent issue of forced labour and its implications for workers in South Africa and beyond. This article explores the challenges and strides made in combating this modern-day slavery. Image: File.
The Congress of South African Trade Unions (Cosatu) presented its submission on the burning and often neglected issue of forced labour to the United States’ Trade Representative (USTR) this past week.
Whilst we differ sharply with the USTR’s approach to this existential matter for millions of workers, it is an issue of great importance for the working class, particularly in the developing world, including South Africa.
Ending slavery and forced labour were among the rallying calls for the formation of trade unions across the world from industrialised to developing nations.
As society has evolved slavery was criminalised and labour rights improved, however we still witness frequent abuses, including forced labour and more recently we have seen a growth in human trafficking linked to these. South Africa despite its advances and progressive labour laws has not been immune from these horrors.
Drafting Cosatu’s submission on the progress we have made as a nation since the advent of democracy in 1994 under successive African National Congress led administrations was a moment of great pride.
We can be proud that our progressive Constitution, labour and other laws deal firmly with slavery, forced labour and human trafficking. In no small part these are products of decades of workers’ struggles, particularly led by Cosatu.
Whilst we have made great strides tackling the scourge of forced labour and trafficking, we must be honest and acknowledge our real gaps, particularly with regards to enforcement and holding transgressors accountable, and to keep pace with often very sophisticated global human trafficking syndicates.
21 million persons across the world are estimated to be in some form of forced labour with alarming numbers for child labour. For those affected, labour rights and protections are a faint hope, in particular for women trafficked for sexual exploitation.
We have seen a deeply worrying increase in South Africans trafficked abroad under the pretense of lucrative jobs into forced labour and crime syndicates as far away as Myanmar.
One of the points raised by the USTR is that forced labour threatens the competitiveness of US companies.
It equally challenges the very survival of South African companies who correctly embrace compliance with our labour and other laws.
Slavery, forced labour and human trafficking are some of the worst abominations facing humanity, something that should never be tolerated. The challenge facing South Africa as Vladimir Lenin challenged, is what is to be done?
First is the tightening of our legislation to protect workers, in particular our trade and customs laws to empower the Minister for Trade, Industry and Competition to impose bans and tariffs on companies and imports from businesses involved in any form of forced labour.
Second is to invest further in the capacity of the Department of Employment and Labour, in particular its inspectors to ensure all workplaces, particularly in high-risk sectors, comply with our laws at all times.
Over the past year we have seen a welcome increase in the number of workplace inspections and the prosecution and conviction of offending employers, including substantial prison sentences for some Chinese employers involved in forced labour.
The South African Revenue Service has done well to improve tax compliance, however customs enforcement remains one of its major challenges and weaknesses. Further investments in its capacity through filling frontline vacancies, strengthening IT systems and deploying scanning machines are key to tackling fraud and illegal imports.
Similar resourcing is desperately needed for the Border Management Authority, hamstrung by a devastating 75% vacancy rate and the South African National Defence Force which are tasked with securing over 72 points of entry, 5244 kms of land borders and 2798 kms of coastlines.
There is a need for a common international approach to this burning matter. A piecemeal approach will not be sufficient. One nation cracking down on it will often simply see such practices displaced to less equipped countries.
There is a need for the International Labour Organisation (ILO) to lead this struggle by establishing a global database of workplaces and countries found to be guilty of such forced labour activities.
This is key to avoid this progressive cause being exploited for narrow domestic protectionist calls or being weaponised to victimise countries for geo-political grudges.
It is important that the ILO craft a common global stance on forced prison labour and exports linked to this practise. Whilst South Africa has correctly criminalised this practise, many leading industrial countries, including some of our largest trading partners, have not and in fact actively use such forced prison labour.
Strengthening legislation, improving capacity to enforce them and cracking down on workplaces and imports involved in forced labour will send a clear message to such employers that this behaviour will not be tolerated.
Whilst we are proud of how far we have come as a country, we are pained as Cosatu that so many workers, and in particular women and children, are subjected to the crimes of forced labour in South Africa and across the world.
It is incumbent upon us as Cosatu to provide meaningful and practical solidarity for workers less fortunate than us, in particular in countries such as Myanmar and Sudan where such abuses are tragically all too frequent, or even in sweatshops closer to home in Lesotho.
Cosatu will soon be holding its national congress, the workers’ parliament. Tackling this scourge of modern-day slavery will be one of the issues to be fleshed out.
It will be key that we emerge from congress with a bold and decisive campaign for Cosatu to lead this struggle at our workplaces with inspection raids, in strengthening our legislation through Nedlac and Parliament, in cracking down on imports built through forced labour and by leading negotiations in our international forums, in particular the ILO.
Solidarity is about giving hope to the most downtrodden and exploited, be it in South Africa or elsewhere. Workers should not be expected to tolerate such abhorrent crimes in this day and age. Cosatu is determined to ensure that such violations become a thing of the past.
Zingiswa Losi is the president of Cosatu.
Zingiswa Losi is the president of Cosatu. Image: Independent Newspapers
