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RAF cash flow crisis

I get a lot of queries from clients, including clients with other attorneys as to the problems being experienced in RAF matters.  The biggest problem right now is the issue of the Road Accident Fund taking so long to make payments.  Some people struggle to believe that their attorneys are telling them the truth when they tell them that some cases can take as long as 8 or 9 months to be paid, and that is just the capital payment in a matter and not the party and party cost refund.  It is an issue that has been reported by the media, but perhaps not as widely as it could have been and it certainly helps clients if they are able to Google on search terms such as “RAF cash flow crisis” or “Road Accident Fund payment problems” and see articles about this themselves.  

The bottom line is that at the current time the Road Accident Fund has a deficit of approximately R9 billion and they estimate that it will grow to R11 billion by the end of February 2016.  It does not mean somebody must not do a claim, or that they will never be paid – it just means that when their case is finalised they have to be patient and understand that there is a limit to what their attorney can do.  It is easy for people to say that one should send in the Sheriff, but when one sends in the Sheriff the Road Accident Fund claims that their assets have already been attached by another attorney, and that their assets largely constitute computers which they need to make payments.  It certainly will not help anybody if an application is brought and ends up resulting in payments being suspended, and so it really requires patience by everybody involved in this work.  Personally I would like to see the CEO of the Road Accident Fund, Dr Eugene Watson, reconsidering his approach of paying the least injured and smallest cases first.  They focus on paying cases settled for R100 000,00 first and then delaying the bigger payments.  I am not sure what the purpose of that is, but I could speculate that that would get rid of probably 50% of the calls that they get complaining and by getting rid of all the smaller calls it might make it easier for them to deal with those complaints that they still get, but it is not fair to those who need the money the most and are the most severely injured in an accident and I really do think that they need to reconsider this approach.  

Posted by Michael de Broglio on Tuesday 24-Nov-15   |  Permalink   |  14 Comments  Comments

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