RAF cash crunch: Transport Minister Barbara Creecy outlines shift to no-fault model
Parliament hears the Road Accident Fund pays out R25b monthly against R4b income, prompting calls for structural reform and an end to costly fault disputes.
The Road Accident Fund (RAF) is facing severe cash shortages that are delaying payouts, the portfolio committee on transport heard on Tuesday.
The fund reported paying out R25b a month against an income of only R4b. Members were told the entity would not recover from its current financial state without structural intervention.
Committee chairperson Donald Selamolela said the department of transport was exploring sustainable funding models and that appointing a permanent chief executive would help stabilise the entity.
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Transport Minister Barbara Creecy, who led a briefing that included the South African National Roads Agency (Sanral) and Airports Company South Africa (ACSA), said the RAF wants to reduce its reliance on the fuel levy, particularly as electric vehicle numbers grow.
The proposed shift to a no-fault system would eliminate the need for the fund to determine blame, bypassing a legal process that currently results in costly court cases.
Selamolela added that irregular expenditure remained a major concern. The board has decided to revert to the GRAP 19 accounting standard standardly used across government, and the fund has withdrawn its litigation against the Auditor-General.
Interventions are underway, but the fund doesn’t expects results anytime soon.
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