Transport Minister Fikile Mbalula said they had managed to cut those costs by a whopping R7 billion and their financial costs had also fallen by more than 60%.
Transport Minister Fikile Mbalula at a Road Accident Fund (RAF) briefing on June 7, 2021. Photo: @ MbalulaFikile / Twitter
CAPE TOWN – The Minister of Transport praised the team tasked with restoring the Road Accident Fund (RAF) after the fund recorded its first surplus in 40 years.
The fund has been a thorn in the side of the nation for many years now, representing one of the biggest tax liabilities, just behind Eskom.
On Monday, Transport Minister Fikile Mbalula announced that they were about to overthrow the fund.
Aggressive reduction in administrative costs was the first step for the special team tasked with repairing the fund.
Mbalula said they had succeeded in reducing those costs by a whopping R $ 1 billion and their financial costs had also fallen by more than 60%.
Mbalula said it was a great start.
“It’s not uhuru yet, we haven’t arrived yet but the signs of where we’re going is Heaven. The foundation is here.”
The minister said they had identified another major structural flaw – their model focuses on litigation, which involved very high legal costs and although there have been different views on how to resolve this. problem, changes had to be made.
“If we look at the situation we find ourselves in, we are basically Santa Claus. It does not help our people,” Minister Mbalula said.
Over the years, the fund has been called upon to pay out more and more money as the number of traffic accidents increased.
There has also been a marked increase in fraudulent claims.
The RAF team acknowledged that administrative failures in the past had led to double payments to some law firms and that they were now taking a tougher stance on more than 100 firms that had failed. not yet refunded the money.
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