NEW RAF LEGISLATION WILL NOT STAND IN COURT OR STOP THE CHAOS
The proposed 2023 Road Accident Fund Amendment Bill will not withstand legal scrutiny, nor will the draft bill do much to address the many issues the Road Accident Fund (RAF) has with claims backlogs, fraud and corruption. OUTA submitted its comments on the draft bill to the Department of Transport – here’s what we said.
OUTA has submitted its critiques of the draft bill to the Department of Transport and, alongside other concerned stakeholders, we are ready to pursue legal action if the Minister of Transport fails to reconsider the bill.
Advocate Stefanie Fick, Executive Director of OUTA's Accountability Division, says our legal team studied the proposed amendment bill, and it is clear that this bill amounts to an unconstitutional, unreasonable and irrational cost containment measure that will have a significant impact on all South Africans.
OUTA's concerns revolve around the proposed change in the fund's purpose, as the bill suggests shifting from compensating accident victims (as a statutory national insurer) to providing social benefits (welfare). It should be noted that the RAF receives approximately R48 billion annually from the fuel levy. While the bill's envisaged “social benefits” would fall short of adequately covering the actual losses incurred in motor vehicle accidents, the fuel levy income received by the RAF will continue to remain in place and grow, as the levy and/or road traffic volumes increase.
Advocate Fick further pointed out that the bill not only limits but effectively eliminates the common law rights of all road accident victims to seek compensation for their injuries, replacing them with a package of social benefits, which OUTA deems grossly inadequate, especially for certain categories of persons or claims.
OUTA's stance is that the bill's focus on cost containment through legislative measures is a diversion from addressing the RAF's fundamental problems, including road safety, the RAF’s grossly inefficient administrative systems, flawed processes, and a lack of leadership and expertise. According to OUTA, the proposed amendments will fail to alleviate the claim backlogs, combat fraud and corruption, address political interference, or establish greater accountability. Instead, the RAF requires effective systems and strong leadership to address these issues.
We call on the RAF to engage with civil society, the private sector, and other stakeholders to seek genuine solutions to its longstanding problems. There is no concrete, independent research or assessments from the Department of Transport or the RAF demonstrating that the proposed amendments would enhance financial sustainability and operational efficiency.
OUTA also urged the Minister of Transport to reevaluate the bill before presenting it to parliament.
OUTA’s comment to the Department of Transport is here.
The draft Road Accident Fund Amendment Bill is here.