South Africa’s Road Accident Fund (RAF) is undergoing a dramatic overhaul after Transport Minister Barbara Creecy officially dissolved the fund’s entire board following months of internal collapse, financial mismanagement, and leadership failures.
In a statement, the Department of Transport confirmed that the decision followed escalating governance failures, ranging from reckless decision-making to boardroom infighting, and the inability to fill critical executive positions – all of which have severely undermined the RAF’s ability to function effectively.
Key issues prompting the board’s dissolution:
- Wasteful legal battles: The RAF spent millions on protracted court disputes, particularly around accounting standards.
- Leadership instability: The board’s handling of suspended CEO Collins Letsoalo drew legal challenges and worsened internal divisions.
- Ballooning debt: Default judgments and unpaid claims have deepened the RAF’s financial crisis.
- Power struggles: Crucial decisions were passed by narrow votes rather than board consensus.
- Unfilled vacancies: Strategic roles like Chief Claims Officer and Head of Legal remained empty for months.
“This has resulted in a loss of confidence in the board’s ability to run the entity effectively,” said Minister Creecy.
What happens next?
To avoid a leadership vacuum, the Department of Transport has asked the National Treasury to appoint an interim Accounting Authority.
A new board will be established through a transparent recruitment process, while an expert panel will conduct a full review of the RAF’s operations.
The Special Investigating Unit (SIU) may also expand its existing corruption investigation to include recent controversies under the outgoing board.
Reform on the horizon
Creecy reiterated her commitment to pushing forward the Road Accident Benefit Scheme Bill, aimed at simplifying the claims process under a no-fault system, which could revolutionize how victims receive compensation.
Public reaction
As trust in the RAF hits rock bottom, many see this as a much-needed reset.
However, analysts warn that the real test will be whether new leadership can deliver accountability, efficiency, and transparency to an institution crucial to the lives of road crash victims.
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