The current third-party insurance scheme in the form of the Road Accident Fund (RAF) is unfair, inequitable, inefficient and unsustainable, the Portfolio Committee on Transport has heard.
The Committee today held a workshop on the Road Accident Benefit Scheme (Rabs) Bill and received a briefing from the Department of Transport on the Bill. The Minister of Transport, Mr Joe Maswanganyi, who led a strong delegation from the Department and the RAF, said the fund is currently used as a cash cow by intermediaries.
“Money that is supposed to go to claimants ends up in the hands of middlemen. The current system is based on fault compensation and is not inclusive. We spend millions of rands on litigation and legal costs are very high,” Mr Maswanganyi said.
The Chief Director of Road Regulation at the Department of Transport, Mr John Motsatsing, told the Committee that the intention of the Rabs Bill is to ensure that the victims of motor vehicle collisions are compensated. “We are trying to overhaul the entire process, looking at the affordability of the scheme we intend rolling out. In the current process, there are quite a lot of intermediaries who receive income arising from the demise of people involved in motor crashes.”
The proposed Bill expands access and seeks equitable compensation for victims to ensure that they can continue with their lives. “We believe that the new system will be much better. A lot of work has been done to arrive at this Bill. This cooperative social system is not fault-based, and intended to target and benefit low income groups. Currently, the system [we have] is exclusive and some of groups are not benefiting as they are supposed to,” he said.
Mr Maswanganyi appealed to the Committee to tighten the process of consultation, especially as a group of lawyers and medical practitioners have already threatened to litigate once the Rabs Bill is passed by Parliament.
The Chairperson of the Committee, Ms Dikeledi Magadzi, said the workshop will assist Members to understand and be knowledgeable about what they are dealing with. “The pro-poor concept is what we need to live up to. The people need to be the beneficiaries of the system,” she said.
Sibongile Maputi
20 June 2017
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