The Road Accident Fund (RAF) in South Africa has incurred significant expenditure on disciplinary hearings for its executives. According to transport minister Barbara Creecy, the fund has spent R12.8m on seven disciplinary hearings, with six other cases under forensic investigation. The disciplinary hearings involve senior executives, including the chief financial officer, chief operating officer, and head of the CEO's office, who have been suspended over governance, administrative, and financial management failures.
The RAF's expenditure on disciplinary hearings has raised concerns about the fund's financial management. The fund is technically insolvent and has asked the National Treasury to increase the fuel levy to R3 per liter, potentially pushing up fuel prices. The fund disburses over R100bn in road accident claims but is in disarray, with almost R30m spent on salaries for 16 suspended executives. The executives face charges including bribery, dishonesty, and negligence.
The disciplinary hearings have been ongoing since August, with the executives engaging costly senior counsel at taxpayers' expense. Some executives have been sitting at home on full pay for almost two years. The transport department has emphasized that the investigations and disciplinary processes must be allowed to run their course, and that no conclusions should be drawn until the processes have been concluded.
ActionSA MP Alan Beesley has criticized the RAF's expenditure on disciplinary hearings, saying it is outrageous and simply not acceptable. Beesley, who is also a member of parliament's standing committee on public accounts, said the expenditure was difficult to justify given the fund's precarious financial position. He noted that thousands of legitimate claims are not being paid due to the RAF having no money.
The RAF's financial struggles have significant implications for road accident victims. Recently, there were over 37,622 claims worth R21.76bn that were unpaid. Beesley said the RAF continues to forget its mandate, which is to compensate victims of accidents and not to blatantly waste taxpayers' money.
The Public Service Commission has also weighed in on the issue, noting that government departments and public entities often disregard civil service rules governing suspensions. Public Service Commission chair Somadoda Fikeni said the Public Service Act allows 60 days' suspension, but most prolonged suspensions have not adhered to these prescripts.
The RAF's new board has been tasked with addressing the fund's governance and financial management issues. The transport department has reiterated that appropriate action will be taken once all investigations and disciplinary processes have been finalized. The standing committee on public accounts will also monitor the implementation of recommendations contained in its report on the RAF.
Key points
- The Road Accident Fund has spent R12.8m on seven disciplinary hearings for its executives.
- The fund's expenditure on disciplinary hearings has raised concerns about its financial management.
- The RAF's financial struggles have significant implications for road accident victims, with thousands of legitimate claims unpaid.
