File photo: Supplied
File photo: Supplied

New crash fund could add 75% to fuel levy, lawyer warns

By Motoring Staff Time of article published Aug 10, 2018

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Cape Town - Just to get the proposed new Road Accident Benefit Scheme up and running will take a 75 percent increase in the current Road Accident Fund levy that we all pay on every litre of fuel we buy.

This according to Kirstie Haslam at DSC Attorneys, who has been actively involved in the parliamentary debate surrounding the proposed ‘no fault’ public insurance bill that is now before parliament as a replacement for the current Road Accident Fund.

And this comes against the background of widespread calls from civil rights organisations across the country to curtail the soaring cost of fuel by reducing the levy - not increasing it.

Let’s do the maths. The current Road Accident Fund levy went up in April to R1.93 a litre. Seventy-five percent of that is R1.45 - which, according to Haslam, is what the proposed new scheme is going to add to the cost of every litre of fuel.

But where does that figure of 75 percent come from?

It comes from the one and only actuarial report commissioned by the department of transport, on which it is relying to justify the affordability of the proposed benefit scheme. That report has not even been subjected to peer review, despite calls for review from a number of individual actuaries as well as the Actuarial Association of South Africa - especially in light of the fact that it will affect every South African, whether or not you drive, or ever have to claim from the scheme.

“Other than the dire affect the bill will have on accident victims’ claims,” Haslam said, "the failure to highlight the anticipated and unavoidable increase in the fuel levy to the public to meet the funding requirements for the Road Accident Benefit Scheme is especially disturbing, considering the latest outcry about the price of fuel and the fuel levy itself.”

So, we will all be paying more, Haslam says. Worse still, we’ll be getting less benefits, not more. The draft legislation proposes a R100 000 cap on individual benefits, to be paid out on dribs and drabs by an administrator employed by the fund rather than negotiated on your behalf by a personal injury lawyer.

The department of transport says that’s to cut out the legal fees which it says take too big a cut out of court-ordered settlements under the current Road Accident Fund. The effect, says Haslam, will be to deny crash victims expert help to get the settlement they need.

'This is especially so in the case of children'

“Children make up about one in three of injured road accident victim claimants," she said, "and they, by the department’s own admission, will be among the worst affected.”

To date no civil rights organisations have been given the opportunity to submit their input on the bill even though they can present compelling independent insights into the dramatic impact which the reduction of benefits will have on road accident victims - not even the QuadPara Association of South Africa, whose requests to make submissions on the bill have been completely ignored.

Once the public consultation process currently taking place around the country until 14 August is completed, the portfolio committee on transport will do a undertake a final review, and then it’s understood that government intends to push the bill through, this year, in the current session of Parliament.

“The focus should be on fixing the current system,” Haslam said, “rather than implementing something which is unknown, costly and inequitable, which is going to cost significantly more, under which most claimants will receive significantly less - and it will be harder to claim.”

IOL Motoring

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