Treating road trauma with compassion
One in 28 South Africans are claiming from, being paid by or being care for by the Road Accident Fund (RAF) for injuries or loss as a result of a motor vehicle accident. This statistic underlines the importance of changing driving attitudes in this country and highlights the significance of the role of the RAF.
“Over the last five years, we have paid out over a million claims,” says Dr Eugene Watson, the fund’s chief executive.
“We are a government entity, funded by fuel tax levies, and insolvent since 1981. By December 2015, a total of R11-billion was payable to almost 6 000 claimants or service providers, and, the RAF’s claim liability is over R130-billion.
“Claim payments have increased significantly as a result of the increase in the fuel levy by the National Treasury to 154 cents per litre. However, although this equates to around R3-billion per month, it remains inadequate when compared to the value of claims settled each month.”
In October 2015, claims amounting to approximately R3.4-billion were settled in one month. The RAF is paying more claims each month and, over the past financial year, claims processing improved by 26%, Watson says.
“We cannot get out of taking our responsibilities responsibly and fairly. People using our roads are impacted by an accident and suffer pain and grief, long after the crash.
“We support a micro-economy, which includes lawyers, actuaries, assessors and medical experts. Sadly, though, half of all trial rolls are RAF claims clogging the courts and there are still long waits for cases to be heard.”
“While some would argue litigation is an unnecessary cost, the reality is that the courts do see claim settlements rationalised with final settlements often 6% to 40% less than what was initially claimed. Noteworthy is that while the fund is perceived to be inefficient in terms of costs, over the last three years we have reduced legal costs from 30% to 19%.”
One way the fund has been able to reduce these costs and change lives is through direct contact and claiming both at its centres and via teams going into communities to spread the word about its services through ’RAF on the Road’.
“We use a church or a school, for example, as a venue and we expose the community to every service we offer in the event they are injured in an accident, from legal counsel and case managers, to the availability of hospital service consultants in 98 hospitals around the country.
“Each direct claim represents a real saving of at least R111 000 per claim in legal fees, equating to a tangible R1-billion based on the number of direct claims settled in the last financial year.”
“A week before the roadshow, we go on community radio and sell what we are doing to all stakeholders. We also have a team on the day that goes onto the streets with loud-hailers. We see at least 500 people per roadshow, and have had 1 500 to 2 000 people turn out. Now, one in three claims is directly through the RAF.”
“If we don’t help the victims of crashes, they will become poor. This is a reality the United Nations has widely reported on. We have seen this, where successful, educated working professionals are involved in an accident that leaves them para- or quadriplegic and at the mercy of family members who are not in a position to give them the proper care. This is where we step in.
“We constantly teach our staff that as they walk around the building, they see claim files but there is a person behind the paper. Restoring dignity as soon as possible makes a real difference.”
Much has and continues to be done to transform the RAF. Since 2013, it has achieved three consecutive clean audits and operational costs are less than 5% of the entire budget. The organisation has also received outside recognition for improving service delivery and honouring its core mandate by winning a number of public sector and transport industry awards.
“The backlog of open claims is reducing and performance continues to improve, but at R3-billion revenue a month, there simply is insufficient money, thus payments queue. Despite these challenges, over 30 000 monthly payments are made – and payments have almost doubled over the last three years.”
Watson explains that in the day-to-day environment, the enforcement of writs disrupts an established cash management plan, resulting in service providers having to be prioritised at the expense of others that are patiently waiting for payment.
He appeals to all those concerned to bear with the Fund, reiterating a commitment to honour its obligations, while working towards more efficient payment days.
“With the current accident compensation scheme not being a solvent arrangement, the transition to the Road Administration Benefit Scheme (RABS) as proposed by the Department of Transport is all the more imperative,” says Watson.
Focus on victim assistance
RABS is intended to replace the current RAF fault-based system which is unsustainable and still overburdened. Under RABS, fault will not be considered on the part of the claimant or other persons involved in the road accident. The focus will essentially be on the immediate assistance of an injured road crash victim, with payments made directly to claimants, medical and healthcare service providers in addition to required future support and rehabilitation.
“We have been sharing information with our Road Accident Fund neighbours in Lesotho, Namibia, Botswana and Swaziland, who have already implemented the changes to the way their income and benefits work. Botswana now, for the first time, has been able to reduce its fuel levies.”
Watson says that the way that RABS will be structured means more citizens - rather than a privileged few citizens - will benefit because there will be funding available from the contribution of every road user.
“The process to formulate this new law has been drafted. It is now vital that it is implemented, because the RAF as we know it simply cannot continue.”