Work at RAF hailed after it records historic R3 billion surplus

This is the entity’s first surplus in many years.

Transport Minister Fikile Mbalula on Monday lauded the work done by the fund, saying the surplus is a dramatic shift from the R5.2 billion deficit recorded in the previous year. 

Mbaluala, alongside RAF CEO Collins Letsoalo,briefed the media on Monday. 

"People would say we might have not paid people since we have this surplus but if you look at the numbers, they will tell you that the claims we paid remain relatively constant, whereas there is a reduction in administrative costs.

"These administrative costs we have built them around legal costs of about R4 billion and you'll see that when you look at the medical costs, we have been paying five times what medical aids are paying. 

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“So, we are bringing RAF back into the market by lowering those medical costs, we have just released for comments our rough medical tariffs," said Letsoalo

RAF stopped using its panel of attorneys, which was cost the organisation R3.6 billion a year. 

"Investment income has increased by 152%, year-on-year, from R62 million to R157 million, finance costs have decreased by 62%, year-on-year, from R263 million to R90 million. Writs of execution have reduced by more than 50%, through a legal strategy and stratification of the debt book," said Mbalula.

"The short-term liability has reduced by R2.2 billion, from R17 billion to R14.8 billion and current assets have increased, including cash position, by more than R4 billion.”

Letsoalo said RAF will be releasing a new RAF 1 form this week. 

This will ensure they have all the information needed for the RAF to assess and finalise a claim.

"So, we receive a form which is called RAF 1 with a medical report, but they don't attach the accident report, so we don't know whether this person fell from a tree, a house or that this person actually got into a road accident and whenever we ask for this information we are taken to court," he said. 

"We are also going to be reviewing all other forms, so this week we will gazette the new RAF 1 and we will also come back and gazette the other forms. 

“Minister, South Africans must also help us, because most of them are not complying with the RAF act where it says that within 14 days of being involved in an accident as an insured driver or owner of that vehicle where a someone who has been killed or injured you must report to the RAF on a RAF 3 form. This has not been done over the years," added Letsoalo.

He said the RAF’s aim is to finalise claims within 120 days.