The Road Accident Fund(RAF) says it holds the office of the Auditor General in high regard despite an ongoing court battle between the two entities over the release of the AG’s report regarding RAF’s financial affairs.
RAF CEO Collins Letsoalo has argued that the RAF is a social scheme and not an insurer covered by insurance principles.
He addressed a media briefing in Centurion, south of Pretoria.
“We developed an accounting policy before we applied that accounting policy to our financials, whatever figure it spills out, then that is that. Then there’s an issue around the recognition criteria of when you recognise this liability. The battle is once you have an accident, is that liability ours or not. We’re saying it’s not our liability. You could have rolled there on your own there, which is a single car accident. There are provisions in section seventeen it’s clear the categories and also section 19 is clear about where is RAF liable and when RAF is not going to pay out those benefits,” says Letsoalo.
Last year, RAF said it posted a surplus of R3.2 billion for the 2020/2021 financial year. This was followed by a deficit of R5.2 billion from the previous year.
The entity has been battling financially over the years as a result of more claims from road crashes as well as fraudulent claims.
The gradual stabilising of the entity has been attributed to a new board that was appointed 18 months ago.
Transport Minister, Fikile Mbalula, made the announcement during a media briefing in Pretoria, last year.
Video: Road Accident Fund reduces liability to R20 billion