National Road Traffic Amendment Bill: final mandates; Road Accident Fund Commission Report 2002: briefing

Meeting report

PUBLIC SERVICES SELECT COMMITTEE
27 August 2003
NATIONAL ROADS TRAFFIC AMENDMENT BILL : FINAL MANDATES; ROAD ACCIDENT FUND COMMISSION REPORT 2002: BRIEFING

Chairperson: Ms P C P Majodina (A N C )

Documents handed out:
Road Accident Fund Commission Report 2002
Road Accident Fund Commission Powerpoint Presentation Part 1
Road Accident Fund Commission Powerpoint Presentation Part 2
National Road Traffic Amendment Bill [B31B-2003]

SUMMARY
All nine Provinces had submitted their respective mandates in favour of the proposed Bill. The conversion process was running fairly smoothly. There was going to be a moratorium on law enforcement until such time as the Bill was signed into law.

In the Road Accident Commission Report 2002 the mandate of the Commission was to find a reasonable, equitable, affordable and sustainable system for payment of compensation and benefits to road accident victims. Many shortcomings in the present system were found, such as ignorance of the RAF, exorbitant transaction costs, high salaries for officials, no functioning Board, unequal benefits for the poor versus the wealthy, a long claims payment process and abuse by claimants, officials and lawyers.

MINUTES
The Chair announced that the final mandates from all the Provinces had been received, but that some Provinces were either not represented at the meeting, or that their delegates were arriving later, or have to leave early.

Mr V V Windvoël (A N C) stressed the importance of special delegates attending for the full duration of meetings.

The Chair expressed her concern that Limpopo Province was not represented at the meeting and neither was Western Cape. It should be brought to their attention.

Mr Lisa N Mangcu (National Department of Transport) announced that they would issue a circular for a moratorium on law enforcement until such time as the Bill was signed into law, since it could not be enforced before such time.
In the interim they would encourage people to convert, and assist those who needed assistance.
The Chair asked whether this applied to all categories.

Mr Mangcu replied that people with former Homeland licences would be assisted, and records kept of others until law enforcement could be done.

The Chair asked whether there were statistics on how many people were converting.

Mr Mangcu replied that it was difficult to find the numbers of people who had to convert. People were coming, and he anticipated that everybody would be in by the time that the law came into force.

The Chair asked they had sufficient (human) resources for implementation.

Mr Mangcu stated that it was difficult to answer that. The Eastern Cape wanted to centralize everything, which had created a bottleneck, but he would be in the Eastern Cape on 29 August 2003 to assist. Mpumalanga had only 35 problem cases, and other provinces none. The machinery was ready, and everything was going to be done to ensure success.

Ms Regina Mosiane (State Legal Advisor) promised to look into the wording of the proposed amendments to check that they conformed to the standard.

Mr Windvoël insisted that the substance of the proposed amendments must not be changed.


ROAD ACCIDENT FUND COMMISSION REPORT OF 2002
Judge Kathleen Satchwell stated that the mandate of the Commission was to find a reasonable, equitable, affordable and sustainable system for payment of compensation and/or benefits to road accident victims.

The current situation, policy issues and delivery were covered in Volumes 1 and 2 of the three-volume Report, while Volume 3 gave research results.Many shortcomings in the present system were found, such as ignorance of the RAF, exorbitant transaction costs, high salaries for officials, no functioning Board, unequal benefits for the poor versus the wealthy, a long claims payment process (average two to three years), and abuse by claimants, officials and lawyers.

What was required was a systemic approach, and the establishment of a Road Accident Benefit Scheme (RABS) with executive and administrative competancies, subject to oversight by a Ministry and Board, to replace the RAF, was proposed.

Judge Satchwell presented the Report (please refer to the document containing printed copies of slides that was handed out) and responded to questions both during and after her presentation.

Discussion
Mr M A Sulliman (A N C) asked if the proposal to introduce monthly payments in lieu of lump sum payments for accident victims would not be a case of duplication, seeing that disability pensions were also available from the state.

Judge Satchwell replied that disability pensions and old-age pensions would have to be taken into account.

Mr V V Windvoël (A N C) pointed out that fishing vessels used fuel and therefore paid the levy on fuel, and asked if they should not then also be covered.

Judge Satchwell replied that a solution had to be found.

Dr E A Conroy (N N P) proposed that all vehicles should be insured, which would solve the problem.

Judge Satchwell replied that that was the old system which was introduced in 1942. Unfortunately many vehicles were not insured. It was a common problem in other countries, and even in Los Angeles as many as 50 per cent of vehicles were not insured. The fuel levy system solved that problem, and South African practice was admired widely.

Dr Conroy asked if the fuel levy could not be applied as a premium for insurance with insurance companies.

Judge Satchwell replied that insurance companies were not interested , because the three billion Rands per annum that was generated by the fuel levy was not enough for them. Their requirement was eight billion Rands per annum. Their transaction costs were high.

Mr Windvoël warned that, as South Africans grew more affluent, claims by wealthy people for maintaining their lifestyles after serious accidents would escalate. He referred to the possibility that a person with a huge income might, totally irrespective of an accident, have gone bankrupt the following year.

Judge Satchwell agreed that, with improving standards of living, the present arrangement was not sustainable. It was suggested that compensation be adjusted as a person's life develops.

Dr Conroy asked if there had to be another car involved for a claim to be considered.

Judge Satchwell replied that one could not claim against one's own guilt.

Mr Windvoël inquired why there had to be a guilty party for a claim.

Dr P J C Nel (N N P) asked if a passenger could claim if the driver of the vehicle in which he was travelling was to blame.

Judge Satchwell said that an innocent passenger could claim, but the claim was limited to a "cap" of R 20 000. She considered this to be unrealistically low. There was, however, the danger that the passenger could be in with the driver.

Mr Sulliman enquired about the standing of adopted children where the law defined dependants.

Judge Satchwell assured the meeting that adopted children were included.

The Chair suggested that disability, old-age and accident pensions be combined, and thanked the Judge for well done research and presentation. The proposals made sense, and all her questions had been answered.

Mr Sulliman wondered if it was constitutional to deny an accident victim the right to a lump sum payment if that was what he preferred over a pension.

Judge Satchwell pointed out that she herself, when she should retire from being a judge, would be paid a pension, with no choice of her own.

Reverend M Chabaku (A N C ) expressed his concern over the fact that the Board of the Road Accident Fund had ceased to be, and asked whether there was not a mechanism to simply extend the term of office of the Board.

Judge Satchwell explained that the Board was established under the R.A.F. Act and that the Department of Transport had been under pressure.

The Chair proposed that this be followed up.

Ms B N Dlulani (A N C) remarked that the amount of the lump sum was not always known, and that lawyers did not give the whole lump sum.

The Chair stressed that there were many abnormalities in the present system against which the country was crying for action, and asked what was going to happen next.

Judge Satchwell replied that the Department of Transport would respond, after which draft legislation would be prepared.

The Chair remarked that lump sum payments would have put injured persons in a position to control their own lives.

Judge Satchwell replied that, same as with old-age pensions, the state did not have an obligation to pay a lump sum.

Meeting was adjourned.