The Minister of Transport, Barbara Creecy, has decided to dissolve the Board of Directors of the Road Accident Fund (RAF) due to persistent governance and operational challenges that have beset the fund and significantly undermined its ability to discharge its statutory mandate.
While the fund is grappling with governance challenges and concerns, which were further confirmed through internal oversight and regulatory engagements, the Minister reiterated on Tuesday that her department would continue to pursue all necessary measures to restore institutional stability.
The Department of Transport has also committed to enhancing the RAF’s capacity to fulfil its statutory obligations to the public and ensure a speedy and equitable access to the Road Accident Benefit Scheme by the road accident victims.
READ | Ministry of Transport to engage Road Accident Fund board
Last month the RAF board suspended Collins Letsoalo as the Chief Executive Officer (CEO) for not attending a Standing Committee on Public Accounts (SCOPA) hearing in Parliament.
Furthermore, SCOPA resolved to launch a full committee inquiry into allegations of maladministration, financial mismanagement, wasteful and reckless expenditure, and related financial misconduct at the entity.
READ | SCOPA probes RAF for maladministration
SCOPA made this decision after months of repeated attempts by the committee to obtain truthful, complete information from the RAF Board and executive management to little avail.
The department has flagged as a concern the inconsistent and, at times, reckless handling of the suspension of the CEO, which attracted a legal challenge and institutional uncertainty.
Through an internal oversight and regulatory engagements, the department noted deep divisions within the Board itself, evidenced by most resolutions being passed through the use of casting votes, rather than consensus, reflecting a lack of cohesion in critical decision-making processes.
The board failed to fill at least two critical executive positions, which are critical to the mandate of the fund, namely that of Chief Claims Officer and Head of Legal.
Furthermore, the department identified the protracted and costly litigation pursued by the RAF on the application of accounting standards as a concern. This has resulted in further strain on the entity’s financial resources and capacity.
The department said the frequent incurrence of default judgments against the RAF, exacerbates its contingent liabilities and weakens its financial sustainability.
“This has resulted in the loss of confidence in the board’s ability to run the entity effectively. On 5 June 2025, the Minister issued letters to the eleven members of the RAF board, affording them the opportunity to make representations regarding her intention to dissolve the board due to their failure to discharge their fiduciary duties effectively.
“The representations were received and have been duly considered. Consequently, the board has been dissolved,” the department said.
Interim measures and review
A submission has been prepared requesting the Minister of Finance to appoint an interim functionary as Accounting Authority in accordance with the Public Finance Management Act.
The proposed appointment is intended to prevent a governance vacuum while a new board is being constituted.
“A draft public advertisement has been prepared to commence the process of appointing a new board, ensuring transparent and merit-based selection in line with applicable legislation.
“To support the development of a sustainable operational and governance model, the Minister has initiated the appointment of a panel of independent experts to review the RAF’s business processes and propose actionable recommendations. Members of the panel will be announced in due course.
“Furthermore, a request has been made to the SIU [Special Investing Unit] to establish if the current investigation under Proclamation 44 of 2024 covers the events of the last three months and if not, formally request the expansion of the scope to cover these events.
“The response from the SIU in this regard is eagerly awaited,” the department said. -SAnews.gov.za
