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Economic Disarray at Road Accident Fund: Sheriff Seizes Assets Worth R18m

Published November 18, 2024
3 months ago

The ongoing financial troubles of South Africa’s Road Accident Fund (RAF) have reached a new peak as the sheriff has recently seized assets valued at approximately R18 million. Scheduled for auction next month, this drastic step highlights the deep-rooted issues within the RAF, which has been struggling to fulfill its financial obligations to road accident victims for years.





In a statement to The Citizen, RAF spokesperson McIntosh Polela disclosed that the seizure encompasses assets from two of its regional offices, primarily affecting its East London and Johannesburg branches. This action follows a series of similar incidents where the RAF's inability to make timely payments has led to the attachment and subsequent auction of its assets.


The financial distress is profound, impacting day-to-day operations significantly. According to Polela, to prevent further seizures, the RAF is now forced into leasing essential items rather than purchasing them. This, unfortunately, hinders operational efficiency and affects workplace conditions. Numsa has expressed severe criticism of the RAF's management, particularly highlighting the subpar working conditions caused by the lack of proper furniture, which is often leased and still at risk of being seized.


Moreover, the RAF is currently grappling with a backlog of over 321,000 claims, with a disclosed payout of R45.1 billion in the recent 2023/24 performance report. The majority of these payments were made to victims unable to return to work post-accidents. RAF's inefficiency not only burdens the victims but also places an enormous financial strain on the fund itself.


At the heart of these financial woes, internal and external conflicts add further complication. RAF CEO Collins Letsoalo has accused the Law Society of South Africa (LSSA) of contributing to these challenges by making allegedly corrupt road accident claims. However, LSSA CEO Justin Erasmus has denied these allegations, pointing back to the need for better management within the RAF itself.


The gravity of the situation was underscored in January when the Mpumalanga High Court ruled that Letsoalo and the RAF board members must pay two claimants from their pockets, underlining the personal accountability that is starting to be demanded of RAF’s leadership.


As another set of assets, including office furniture and equipment from the Centurion offices, approaches auction this Friday, stakeholders are urging swift and decisive governmental intervention. The RAF's role in supporting accident victims is crucial, and its failure to manage finances adequately undermines this essential service.


The unfolding situation at the RAF serves as a stark reminder of the broader implications of mismanagement within state-owned entities, affecting not just the operational efficiency of the organization but also the welfare of thousands of South Africans relying on its support.


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