RAF CEO Collins Letsoalo said they disagreed with the high court finding that they were an insurer amid an adverse finding by the Auditor-General for not complying with prescribed accounting standards.
The Road Accident Fund has petitioned the President of the Supreme Court of Appeal (SCA) after the same court refused to hear their leave to appeal in a matter over its decision to change its accounting policies.
This comes after the SCA found there were no prospects of success when RAF sought relief after the Gauteng High Court turned down their leave to appeal.
At the centre of the appeal is whether RAF is an insurance fund or a social benefit fund.
Briefing the standing committee on public accounts (Scopa) on Wednesday, RAF CEO Collins Letsoalo said they disagreed with the high court finding that they were an insurer amid an adverse finding by the Auditor-General for not complying with prescribed accounting standards.
“We have taken it on review for obvious reasons. We don’t think that is the case. It is in front of the SCA. We have asked for reconsideration by the President of the SCA,” Letsoalo said, adding that the SCA had turned down their leave to appeal on grounds that it did not meet the requirements of a special appeal.
His statement was despite Transport Deputy Minister Mkhuleko Hlengwa earlier informing Scopa that the ministry did not support the ongoing dispute between RAF and the AG regarding accounting standards being applied in so far as liabilities were concerned.
“We do not support the court action that has been instituted by the RAF on this matter resulting in three adverse judgments as we believe these differences can and should be resolved through dialogue and mutual understanding,” Hlengwa said.
He said that any changes at RAF should be addressed through proper legislative reforms.
“These changes must be thoroughly considered, debated and aligned with broader objectives of the medium development plan of ensuring RAF meets its obligations both now and into the future,” Hlengwa added.
RAF board chairperson Zanele Francois said at the core of their legal challenge was that there was no appropriate social benefit standard to be applied around the recognition of claims liability in the country.
“We need a technical solution irrespective of what is going on with the courts. The sooner we get technical standards that is relevant, this matter will be technically resolved,” Francois said.
ANC MP Helen Neale–May said the money spent by RAF on litigation should have been used to settle claims.
“The only people that are benefiting is the legal fraternity, not the claimants,” Neale-May said.
MK Party’s David Skosana said RAF has the right to go to any court regarding the matter and stated that it was correct to regard itself as a social benefit fund, not an insurer.
“The CEO’s head is on the line. It is more political than anything else. It did not start with the seventh administration. It started with the sixth administration. We know what is happening behind the scenes,” Skosana said.
However, his colleague Kwenzokuhle Madlala warned about falling into a trap to want to pursue a matter till the end.
“From where we come from we normally say you comply and complain later. It does not deprive what you believe is right. In the meantime we need this institution to be compliant, operational and service the people,” Madlala said.
DA MP Farhat Essack noted with concern that about R10.7 million in fruitless and wasteful expenditure.
Cape Times