R48m for doing nothing: How the RAF lost control of itself

The parliamentary inquiry into the Road Accident Fund (RAF) starts this Tuesday morning, and already the documentation prepared for the inquiry suggests a shambolic organisation. For starters, 34 staff members are suspended on full pay, some for as long as four years, costing the organisation about R48m a year. 

The standing committee on public accounts (Scopa) oversight inquiry into the RAF will look into “allegations of maladministration, financial mismanagement, wasteful and reckless expenditure, and related financial misconduct at the RAF”. It was established after Scopa said it struggled to obtain “truthful and complete information” from the RAF board and executive management.

The reason why some of the information has been so difficult to obtain is now becoming clear; according to ActionSA MP and Scopa member Alan Beesley the organisation is clearly shambolic.  One of the intentions of the inquiry is to discover “how deep the hole is”, he tells Currency.

What is known is that there is a huge quantity of unpaid claims against the RAF – the sole designated organisation that settles third-party motor accident claims out of a fund derived from a levy on the fuel price. “I don’t think anybody has any idea how deep the hole is. It could be massive,” says Beesley. 

One of the things the documents prepared for the inquiry has uncovered is that the cost of legal fees in respect of disciplinary matters has been growing massively, and is currently “off the charts”.

In 2020, the total cost was R2.2m; that rose to R8.3m the following year, then to R22.2m in 2023. It ballooned to R42.3m last year, and is already R24.5m so far this year.

Incredibly, two employees recently had their suspensions lifted after nearly five years. Together, the cost of their salaries over that period was a staggering R15.2m. 

The questionable aspect of the status of the 34 staff members currently suspended on full pay is that some of the employees have been suspended since August 2021, despite the fact that the RAF has theoretical 90-day cutoffs. 

“You just wonder where the board was in all of this?” Beesley asks. 

In its parameters for the inquiry, the Scopa documents say that there have been “several allegations and complaints of a climate of fear at the RAF, where some employees have been subjected to prolonged suspension (which exceeded the RAF’s mandated 90-day limit) and subsequent dismissals under suspicious circumstances”.

The suspensions and dismissals are alleged to occur despite employees being acquitted in internal hearings, thereby forcing them to fund costly litigation against the RAF. The complaints further allege that the RAF “does not comply with Labour Court orders which are not in their favour”.

Further, the complaints allege that there is “collusion” between “employment relations, external law firms, and even certain CCMA [Commission for Conciliation, Mediation and Arbitration] commissioners to guarantee dismissals, with attorneys allegedly acting outside RAF’s policies”.

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