Transport minister Barbara Creecy has dissolved the board of the Road Accident Fund (RAF), citing ongoing governance and operational problems.
According to department spokesperson Collen Msibi, the decision was prompted by persistent challenges that have plagued the Fund.
He said on June 5 2025, Creecy issued letters to the 11 board members, 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," Msibi said.
He said the governance challenges and concerns that were further confirmed through internal oversight and regulatory engagements include protracted and costly litigation pursued by the RAF on the application of accounting standards.
He said this had resulted in further strain on the entity’s financial resources and capacity.
Msibi said there was also the inconsistent and, at times, reckless handling of the suspension of the CEO, Collins Letsoalo, that attracted a legal challenge and institutional uncertainty.
Other issues include the frequent incurrence of default judgments against the RAF, which has exacerbated its contingent liabilities and weakened its financial sustainability.
"Deep divisions within the board itself, evidenced by most resolutions being passed through the use of casting votes, rather than consensus, reflected a lack of cohesion in critical decision-making processes.
Deep divisions within the board itself, evidenced by most resolutions being passed through the use of casting votes, rather than consensus, reflected a lack of cohesion in critical decision-making processes.
— Collen Msibi
"The failure by the board to fill at least two critical executive positions, which are critical to the mandate of the Fund, namely Chief Claims Officer and Head of Legal, has resulted in the loss of confidence in the board's ability to run the entity effectively."
Msibi said a submission has been prepared requesting the minister of finance, Enoch Godongwana, 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."
The dissolvement of the board came just days after Letsoalo,and the Chief Investment Officer, Sefotle Modiba, who is also in suspension, held a media briefing at the weekend, where they claimed that their suspensions are linked to their efforts to improve the Fund’s operations.
Msibi added that 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.
"Minister Creecy has reiterated her department's commitment to continue to pursue all necessary measures to restore institutional stability and enhance 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.
"She further emphasised her department’s intent to finalise the Road Accident Benefit Scheme Bill, which will introduce a no-fault system to make it easier for road accident victims to access the benefits without costly legal bills."
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