Durban - The Road Accident Fund has turned nasty on some of its service providers – lawyers and medical experts it hired to defend claims – telling them to stop suing for unpaid fees or it will halt payments.
The fund admits to owing more than 6 000 service providers and claimants more than R8 billion – but says the “aggressive” flood of writs for non-payment it received in April and May this year – an increase of 444% on the same period last year – is disrupting operations, as is the attachment and removal of “critical business equipment”.
But those owed the money say the fund is the author of its own misfortune and it has no right to issue threats to those who are legitimately owed money.
One attorney, who did not want to be named, said his firm was owed about R50 million and he had already had to retrench staff.
Another attorney, who has 400 accounts outstanding, said he could not even draw a salary this month.
“I have had to borrow money to keep the firm going, to pay the rent and the overheads.
“I understand that they have a problem. But they are not even prepared to engage or to enter into payment plan agreements. We are just told to shut up.”
There are about 15 firms in Durban – and hundreds across the country – appointed by the fund to serve on a panel to defend claims.
In the past, when the fund made changes to the panel, the attorneys kept their existing cases to ensure continuity and only new claims were given to the new panel members.
But earlier this year, the fund ordered a “blanket removal” and changed the entire panel, telling the old panel attorneys to close their files and send their accounts.
The attorney – who did not wish to be named for fear of victimisation by the fund – said accounts would usually only become payable on the finalisation of a matter – which could take three to 10 years.
But now the fund, on its own instruction, had been flooded with bills, payable immediately, when these had not been budgeted for.
In a circular to “ stakeholders” dated June 22, chief financial officer Yolande van Biljon talks of the “disruptive impact of the daily engagement with the sheriff”.
“The aggressive nature of the current engagement as far as writs are concerned has diverted our focus to avoiding disruptions to our operations, including the team having to deal with securing critical business equipment that has been removed.
“As a result, payments might be delayed or even halted entirely until the receipt of the June fuel levy.”
She blamed a few “recalcitrant service providers” for this, accusing them of “ jeopardising the sustainability of thousands of others”.
Attorney Michael Friedman, whose firm acts against the fund, said at any given time he was owed between R20m and R30m for fees and claims.
“The problem is that the fund makes promises to pay but then doesn’t do so. Last year it went on a roadshow in an attempt to cut attorneys out of the process and pay claimants directly. They paid out large amounts and used up any surplus.”
Van Biljon said the Road Accident Fund expected increased fuel levies to flow in from July, “but more immediate measures to relieve the pressure on the institution and its service providers are being investigated”.
The Mercury