OIDA International Journal of Sustainable Development
Open-access peer-reviewed journal
https://doi.org/10.64211/oidaijsd190623
Public Finance Challenges in Local Government: Insights from both Literature and Auditor General
Mandisi Matyana 1,*, Mziwendoda Cyprian Madwe 2, Matjhupe Muroa 3
1,3 Department of Public Administration, University of Zululand, South Africa.
2 Department of Accounting and Auditing, University of Zululand, South Africa.
* Corresponding Author: MatyanaM@unizulu.ac.za
Volume 19, Issue 06, Pg. 297-310, 2026
Abstract: Financial misconduct consistently poses a serious concern within South Africa municipalities and in other spheres of government. The Auditor General of South Africa (AGSA)’s annual reports have consistently picked out irregularities which results in mismanagement of government funds allocated for service delivery and essential basic need of the society. This misused of limited financial resources undermines the quality of life for citizens who are deprived of basic municipal services. This paper explores factors affecting financial management in South Africa during the post-apartheid era. The paper also reviews prior research to uncover mechanisms that have been proposed by other researchers to address financial mismanagement in local municipalities. Using systematic literature review of sixty-two articles published between 2018 to 2025, and Auditor-General of South Africa audit reports, this study reveals that financial mismanagement within municipalities emerge from non-compliance with legislation, limited managerial and financial expertise, corruption and governance deficiency. This study suggests that local municipalities should strengthen their governance frameworks, providing targeted financial management trainings, improving accountability mechanisms to address financial mismanagement. This study proposes strategies that municipalities, policymakers and oversight institutions can apply to enhance financial management and ensure more equitable and inclusive service delivery.
Keywords: Governance, Finance Mismanagement, Local Government, Service Delivery
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