By Johnathan Paoli
Following months of mounting governance failures, deep internal divisions, and operational dysfunction, Transport Minister Barbara Creecy has dissolved the board of directors of the Road Accident Fund (RAF).
A loss of confidence in the board’s leadership was cited, with the ministry highlighting a series of critical missteps, including costly litigation, reckless executive suspensions and a failure to appoint key executives.
“The protracted and costly litigation pursued by the RAF on the application of accounting standards has strained the entity’s financial resources and operational capacity.
“This, along with the reckless handling of the suspension of the chief executive officer, has created legal and institutional uncertainty and undermined the public’s trust,” department spokesperson Collen Msibi said in a statement.
The Special Investigating Unit (SIU) is already probing the RAF for alleged corruption and maladministration under Proclamation 44 of 2024.
Creecy has requested that it expands its investigation to include developments over the last three months, including the suspension of senior executives.
Former RAF CEO Collins Letsoalo, who was suspended in May on allegations of financial mismanagement and corruption, has denied any wrongdoing.
Letsoalo and suspended chief investment officer Sefotle Modiba told reporters over the weekend that their suspensions were politically motivated and linked to their attempts to reform the fund.
They alleged that their efforts to improve transparency and reduce waste, including recovering R50 million in savings, triggered resistance within the board.
In addition to the growing controversy around executive suspensions, the department highlighted several other failings that led to the dissolution of the board.
Among these were the frequent incurrence of default judgments, which have worsened the RAF’s contingent liabilities and financial sustainability, the inability to appoint a chief claims officer and a head of legal, and the board’s reliance on casting votes, rather than consensus, to push through key decisions.
“These issues reflect a broader collapse of cohesion and sound governance practices at the highest levels of the entity. We need urgent corrective action to restore the RAF to a stable and functional state,” Msibi said.
As part of her intervention, Creecy has appointed an interim advisory committee tasked with developing a sustainable operational and governance model for the RAF. She has also initiated a process to recruit a new board of directors that can provide ethical and effective leadership.
Unions and civil society have cautiously welcomed Creecy’s decision, but warn that deeper systemic reforms are necessary to address the long-standing issues at the RAF.
“The dissolution of the board is a necessary first step, but unless we see proper forensic investigations, skilled leadership appointments, and a full overhaul of claims processing, the fund will continue to fail the very people it was created to serve,” said the South African Road Accident Victims Association.
Creecy has vowed to act swiftly in stabilising the RAF, stressing that accountability, financial sustainability and service delivery to accident victims remain non-negotiable priorities.
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