Scopa plans to take action over fruitless and wasteful spending, particularly on court cases with no chance of success.
Parliament’s Standing Committee on Public Accounts (Scopa) is considering laying criminal charges and taking other consequence measures against former Road Accident Fund (RAF) CEO Collins Letsoalo and the fund’s board.
It emerged on Friday during a Scopa meeting that attorney firms that advise the RAF on the large number of court applications it lodges aren’t off the hook either.
In addition, an off-the-record meeting has been suggested with Minister of Transport Barbara Creecy to urge her to consider delaying the introduction of the Road Accident Benefit Scheme Bill (Rabs) because it may not solve the RAF’s financial woes.
Letsoalo described as ‘wrecking ball’
Scopa member Alan Beesley of ActionSA asked Scopa chair Songezo Zibi for an update on the plan to criminally charge Letsoalo, adding there’s no doubt he had been “a wrecking ball” on the RAF.
Beesley said that every time Scopa receives a report, it’s clear what “a wrecking ball” the RAF has been on the courts, road accident victims, employees and service providers and Letsoalo has never accounted for his decisions.
“… if you [Zibi] are going to lay charges, I’m more than happy to accompany you because something needs to be done,” he added.
Zibi said Scopa should put the question of laying charges on the table for its next meeting and then discuss the implementation of that resolution.
He said a memorandum from parliament’s legal services will be shared with members of Scopa when the committee discusses the next portion of its draft report on its oversight inquiry into the RAF’s affairs.
“That matter [laying charges] is nearing finality,” he said.
Fruitless and wasteful expenditure
Scopa member Patrick Atkinson of the Democratic Alliance (DA) mentioned the report to Scopa on Sunshine Hospital.
He said the report referred to judges’ comments in judgments about the RAF’s sheer lack of concern – particularly from Letsoalo – an the amount of money it spent on legal fees, on matters that may almost certainly be thrown out of court.
Atkinson said this goes beyond fruitless and wasteful expenditure and “is almost criminal liability” because the RAF knew the money was being wasted and it was “just spending money on legal fees like a drunken sailor”.
Atkinson said the judge in one of these matters referred to the possibility of a personal cost order against Letsoalo.
He asked Zibi if there is some way for Scopa to reclaim some of these legal fees back from Letsoalo, and possibly RAF board members as well, because of their sheer lack of care and arrogance in allowing these matters to go ahead knowing there was very little chance of success.
“This just seems to be a recurrent theme because no one seemed to care about the legal costs and … ultimately … every taxpayer has been funding Mr Letsoalo’s complete excess and the way he dealt with legal cases,” he said.
Zibi said Scopa will look at the different topics and carefully work out instances where it believes funds have been wasted in an egregious way.
He said there are cases where an institution, management or board spends money in good faith, but the funds are ultimately used incorrectly or on fruitless exercises.
There are also instances where actions are taken for their own sake and public funds are spent extensively in pursuit of something obviously futile.
“I think in those [latter] instances we have to debate, as a committee, as to what consequences should follow for the individuals concerned. I would suggest we take all of those together and then we are able to say in these instances we recommend the following, so that there can be proper consequences,” he said.
Lawyers and personal liability
Scopa reported in November 2025 it had taken steps to have Letsoalo criminally charged and prosecuted.
However, those charges specifically related to him defying a lawful summons to appear before Scopa’s oversight inquiry into the fund. It is unclear what has happened in regard to this charge.
Scopa member Helen Neale-May of the ANC suggested that the committee also look at the lawyers who advised the RAF. “Should they not at some stage be held responsible,” she remarked.
Neale-May referred to litigation that took place when courts said there was no case and there were numerous judgments against the RAF. “There were 181 court orders that were ignored. Surely the legal fraternity needs to take some responsibility.
“Failure to comply with court orders is not an administrative error. It’s a breakdown of the rule of law requiring personal accountability.
“I believe that civil recovery of losses from fruitless and wasteless expenditure should be taken from the former CEO and the board.”
Neale-May added that personal liability is in the Public Finance Management Act (PFMA) and “is something that we should really put in our recommendations in the report”.
The Rabs Bill and the funding shortfall
Atkinson said the RAF is set up for failure because there is no way that money from the fuel levy can cover the kind of claims that come through if the RAF Act is followed in its entirety.
“There is a huge shortfall between the money that we get from the levy and the money that needs to be paid out,” he said.
Atkinson said he mentioned this as Creecy appears to be pushing ahead with the Rabs Bill. He believes that far from solving the RAF’s financial problems, the bill might exacerbate them.
He does not think the finance minister would allow it to proceed either.
“I don’t think the required solution is going to be the Rabs Bill. I think it will exacerbate the problem even further because in essence to run two parallel schemes – which is what the Rabs Bill will require – will cost between up to R70 billion to R80 billion a month and we are only getting R48 billion [a month] as it is, so it’s completely financially undoable.
Atkinson said it might be worthwhile having an off-the-record discussion with Creecy to ask her to delay any further changes at the RAF until Scopa has published the report on its RAF inquiry and people have had a chance to understand the problem and the required solution.
Deputy Minister of Transport Mkhuleko Hlengwa said during the department’s budget vote in parliament last week the current RAF model is not financially sustainable and the department intends to introduce the Rabs Bill to parliament this year, with the proposed framework providing for defined structured benefits on a no-fault basis.
Hlengwa said the department is also researching options for a hybrid funding model for the RAF that will include both private and public contributions to lessen the burden on the fiscus.
Atkinson said that Scopa’s recommendations in the report should look at bringing in a system (possibly hybrid), “that is financially doable for the country”.
This article was republished from Moneyweb. Read the original here.