Home South African RAF denies reports it has hidden R300bn

RAF denies reports it has hidden R300bn

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The Road Accident Fund has named law firms that have over the years made a fortune from the entity while poor people who had been injured in accidents get little or no compensation.

File picture: Dumisani Dube/African News Agency (ANA)

THE ROAD Accident Fund (RAF) has named law firms that have over the years made a fortune from the entity while poor people who had been injured in accidents got little or no compensation.

CEO of the RAF Collins Letsoalo said they were serious about turning around the entity, saying the agency wanted to prioritise victims to be compensated on time.

Transport Minister Fikile Mbalula and Letsoalo also denied reports that the RAF had hidden R300 billion.

“A lot of things are being written about the RAF that they are hiding R300 billion. They are running a spaza shop, they are running something that they don’t understand. But those who have access to the media are bad mouthing, but we are not bad mouthing – we are here to account,” Mbalula said.

Letsoalo said he was aware of the report of a so-called anonymous letter reported by some media publications.

“The letter seems to suggest that my friends are given preference and paid first at the RAF. It then lists a claim which is purportedly settled and paid within a period of a week to an apparent friend of mine.

“I must categorically state that I have no such a friend and my declarations of interest are clear on this. I don’t know who Radipabe Attorneys are and who runs that law firm.

“It is fashioned in this way because I suspect the fact that the law firm settled a matter in Limpopo, which is my home province, must raise eyebrows and make the allegations believable.

“I then asked (for it to be investigated) and what we found was that the matter was settled in August 2021. The payment was made 163 days later which makes it fall in the category of 150-180 days payments in line with the RAF payment strategy.

“We have not stopped there but have referred this for forensic confirmation as some court orders have been fraudulent in the past. We will leave no stone unturned in ensuring that we get to the bottom of these allegations,” Letsoalo said.

Mbalula, together with the non-executive members of the board and RAF, briefed the media on Friday on the agency’s financial position and interventions made to stabilise it.

“As part of this transparency, we have decided to release the top 20 law firms that we have paid, the amount paid and the ageing on that debt. This will enable South Africans to know that nothing in RAF is for any individual or any nepotism will be easily identified.

“We will be releasing this list every quarter in the interest of transparency.” Letsoalo said. He added that this would further enable South Africans to hold the RAF accountable on their commitment of introducing a more equitable payment system based on prioritising the oldest debt in line with their 180 days payment strategy.

Of the 20 plaintiffs, Capital Payments made between April 1 2021 to March this year. They included: Kruger & Co – R395,584,233; Naidoo and Associates – R394,075,017; A Wolmarans Inc – R348,269,747; Gert Nel Prokureurs – R332,204,019; and, Savage Jooste & and Adams Incorporated – R331,533,905.

Letsoalo said RAF has also faced a massive resistance and pushback from those that have benefited from the past inefficiencies of the RAF.

He said those who benefited from not only the corruption, but past practices that they found unsustainable like what was known as “fixed allocations”.

“This was meant for big law firms and probably medium firms that put enough pressure on RAF to be paid first notwithstanding the age of their debt. This resulted in a fragmented RNYP book with some claimants owed more than 1,000 days in debt while some, mostly big law firms, owed less than 30 days’ debt.

“We then embarked on a payment plan to pay debt 180 days and older first. We encountered a backlash from those used to getting as much as R100 million ’fixed allocation’ a month from RAF’s R3.5 billion monthly fuel levy income,” Letsoalo said.

“We are happy to report that we have had more progress and that where we experienced challenges, we were able to develop solutions that take us forward to ensure transformation of the RAF,” Letsoalo said..

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