Road Accident Fund accused of hiding billions amid crushing debt.

Legal advisor Gert Nel from the Association for the Protection of Road Accident Victims claims the Fund manipulates its books to conceal massive debt and avoid paying accident victims.

Parliament’s Standing Committee of Public Accounts (SCOPA) is trying to uncover the rot at the Road Accident Fund (RAF).

The RAF is facing accusations of financial mismanagement and deliberate obstruction of victim claims, with its debt estimated to have ballooned to R500 billion.

Legal advisor Gert Nel from the Association for the Protection of Road Accident Victims said that the RAF allegedly altered its accounting standards to conceal billions in liabilities and has unlawfully failed to pay thousands of legitimate claims.

According to Nel, the RAF changed its structure 'overnight' from a social insurance scheme to a social benefits scheme, effectively writing off hundreds of billions in contingent liabilities that courts have since ruled unlawful.

"They essentially changed themselves overnight from a social insurance scheme to a social benefit scheme. Subject to a social benefit scheme, they only recognised claims that have received offers on them. Essentially, they took about two-thirds of their contingent liability overnight off their books, reducing their liabilities on paper from R340 billion as of 31 March 2021 to R30 billion.

"This whole operational change that the Road Accident Fund introduced was a carefully planned process to reduce the amount of claims and also to reduce the amount of settlements and to keep claims that are in the system in transit, in other words, to keep the settlements of these claims ongoing as long as possible.

Nel adds that, despite orders from the Auditor-General and the Minister of Transport to correct these practices, the Fund reportedly continues to ignore valid claims, leaving victims unpaid for years.

"They are taking the ostrich stance, putting their heads in the ground, and they are ignoring claims that have been lodged. That's why we hear these sad stories about victims who have been in the process for two, three, five, seven years, not getting paid because the Road Accident Fund simply ignores those claims as if they don't exist, but it's out there. It's like this phantom parallel system that the Road Accident Fund created for themselves, thinking that nobody is going to pick up on it."

He noted that while the RAF receives around R4 billion monthly from the fuel levy, much of it has allegedly been misused, with little reaching accident victims.

Nel acknowledged slight improvements under the Fund’s new interim board but described years of 'toxic leadership' and financial rot that have left injured South Africans destitute while officials allegedly misused funds meant for compensation.