Note to Editors: ActionSA’s estimate of the RAF’s unrecorded liabilities are outlined at the conclusion of the statement.
ActionSA is deeply concerned that the Road Accident Fund (RAF) – responsible for compensating victims of road accidents – is completely insolvent, with unrecorded liabilities of more than R500 billion. This represents a financial disaster for which ordinary South Africans will ultimately pay the price.
We therefore call for the RAF’s former Board of Executives to be charged for dereliction of duty, and for the Ministers of Finance and Transport to account for how this malfeasance was allowed to persist under their executive watch.
During the Standing Committee on Public Accounts (Scopa)’s inquiry into the RAF’s mismanagement this week, ActionSA questioned the Auditor-General of South Africa (AGSA) about the Fund’s unrecorded liabilities — the amounts owed to claimants that are absent from its financial statements. The AGSA confirmed that the total cannot currently be estimated.
In essence, nobody knows how deep this hole is. Based on ActionSA’s own calculations, the unrecorded liabilities amount to more than R500 billion, nearly one-fifth of the national government’s entire annual budget.
How was this hole created? It is the responsibility of the RAF’s Board and management to ensure that all liabilities are accurately recorded, yet the leadership has deliberately failed to do so, materially misstating the Fund’s financial position. They did this in two key ways.
First, by applying unauthorised and non-compliant accounting standards when preparing the Fund’s financial statements, in direct contravention of the PFMA and GRAP requirements. This manipulation caused claims and liabilities to be understated or omitted. In 2020, using the correct accounting standards, the RAF’s claims liabilities stood at R330 billion. Under the unlawful restatement, this figure was reduced to just R27 billion, effectively erasing R300 billion in obligations from the books – R385 billion today when adjusted for inflation.
Second, by unlawfully altering the process for registering claims through the introduction of RAF New Form 1, which has led to the mass rejection of legitimate claims as “non-compliant.” Between July 2022 and March 2025, 105 039 claims were pre-assessed using the new form, of which 75 990 (or 72%) were rejected. Since its introduction, the number of claims registered annually has fallen from roughly 300 000 in 2021 to under 100 000 in each subsequent year, effectively excluding hundreds of thousands of potential claimants and inflating the Fund’s reported financial position by more than R120 billion.
Taken together, these accounting and administrative manipulations have concealed more than R500 billion in unrecorded liabilities, one of the most serious financial misstatements by any state entity in democratic South Africa.
Both the Auditor-General and South Africa’s courts have confirmed the unlawfulness of the RAF’s conduct. Over the past five years, the courts have repeatedly ruled against the RAF Board for unlawfully altering claim registration processes and applying non-compliant accounting standards, while the Auditor-General has consistently issued disclaimed or adverse audit opinions since 2020/21. In each instance, the AGSA found that the RAF’s accounting treatment of outstanding claims liabilities and related expenditure contravened the PFMA and GRAP requirements.
Despite these findings, the RAF continues to resist implementing lawful accounting standards and the correct claim registration procedures, conduct that can only be interpreted as deliberate and driven by ulterior motives.
ActionSA therefore calls for the previous RAF board to be charged with dereliction of duty and warns that the full extent of this financial collapse poses a grave risk to South Africa’s fiscal stability. Ultimately, it will be ordinary taxpayers who are forced to shoulder the burden of the RAF’s concealed liabilities and financial mismanagement through higher fuel costs.
The Ministers of Finance and Transport, together with the National Treasury, must urgently account for how this crisis was allowed to escalate unchecked under their oversight. ActionSA will continue to expose the government’s concealed rot and ensure that those responsible are held to account.
———
ActionSA’s estimate of the RAF’s unrecorded liabilities are as follows:
1. Arising from using non-compliant accounting standard:
- 2020 Claimant liabilities (correct accounting standard): R330 billion
- Restated 2020 claimant liabilities (incorrect accounting standard): R27 billion
- Claimant liabilities “written off”: R303 billion
- Adjusted for CPI inflation of 5% p.a. from 2020 to 2025 = R386.7 billion
2. Arising from the improper use of RAF New Form 1:
- Average reduction in claims registered per year since 2021: ≈ 142 000
- Period affected: 3 years (2022 – 2025) → total unprocessed claims ≈ 426 000
- Average claim payout: R 286 000
- Estimated value of unprocessed claims: 426 000 × R 286 000 = R 121.8 billion
Total unrecorded claimant liabilities = R508.5 billion
ActionSA Reveals RAF’s Shocking R500 Billion Liabilities Hole
Note to Editors: ActionSA’s estimate of the RAF’s unrecorded liabilities are outlined at the conclusion of the statement.
ActionSA is deeply concerned that the Road Accident Fund (RAF) – responsible for compensating victims of road accidents – is completely insolvent, with unrecorded liabilities of more than R500 billion. This represents a financial disaster for which ordinary South Africans will ultimately pay the price.
We therefore call for the RAF’s former Board of Executives to be charged for dereliction of duty, and for the Ministers of Finance and Transport to account for how this malfeasance was allowed to persist under their executive watch.
During the Standing Committee on Public Accounts (Scopa)’s inquiry into the RAF’s mismanagement this week, ActionSA questioned the Auditor-General of South Africa (AGSA) about the Fund’s unrecorded liabilities — the amounts owed to claimants that are absent from its financial statements. The AGSA confirmed that the total cannot currently be estimated.
In essence, nobody knows how deep this hole is. Based on ActionSA’s own calculations, the unrecorded liabilities amount to more than R500 billion, nearly one-fifth of the national government’s entire annual budget.
How was this hole created? It is the responsibility of the RAF’s Board and management to ensure that all liabilities are accurately recorded, yet the leadership has deliberately failed to do so, materially misstating the Fund’s financial position. They did this in two key ways.
First, by applying unauthorised and non-compliant accounting standards when preparing the Fund’s financial statements, in direct contravention of the PFMA and GRAP requirements. This manipulation caused claims and liabilities to be understated or omitted. In 2020, using the correct accounting standards, the RAF’s claims liabilities stood at R330 billion. Under the unlawful restatement, this figure was reduced to just R27 billion, effectively erasing R300 billion in obligations from the books – R385 billion today when adjusted for inflation.
Second, by unlawfully altering the process for registering claims through the introduction of RAF New Form 1, which has led to the mass rejection of legitimate claims as “non-compliant.” Between July 2022 and March 2025, 105 039 claims were pre-assessed using the new form, of which 75 990 (or 72%) were rejected. Since its introduction, the number of claims registered annually has fallen from roughly 300 000 in 2021 to under 100 000 in each subsequent year, effectively excluding hundreds of thousands of potential claimants and inflating the Fund’s reported financial position by more than R120 billion.
Taken together, these accounting and administrative manipulations have concealed more than R500 billion in unrecorded liabilities, one of the most serious financial misstatements by any state entity in democratic South Africa.
Both the Auditor-General and South Africa’s courts have confirmed the unlawfulness of the RAF’s conduct. Over the past five years, the courts have repeatedly ruled against the RAF Board for unlawfully altering claim registration processes and applying non-compliant accounting standards, while the Auditor-General has consistently issued disclaimed or adverse audit opinions since 2020/21. In each instance, the AGSA found that the RAF’s accounting treatment of outstanding claims liabilities and related expenditure contravened the PFMA and GRAP requirements.
Despite these findings, the RAF continues to resist implementing lawful accounting standards and the correct claim registration procedures, conduct that can only be interpreted as deliberate and driven by ulterior motives.
ActionSA therefore calls for the previous RAF board to be charged with dereliction of duty and warns that the full extent of this financial collapse poses a grave risk to South Africa’s fiscal stability. Ultimately, it will be ordinary taxpayers who are forced to shoulder the burden of the RAF’s concealed liabilities and financial mismanagement through higher fuel costs.
The Ministers of Finance and Transport, together with the National Treasury, must urgently account for how this crisis was allowed to escalate unchecked under their oversight. ActionSA will continue to expose the government’s concealed rot and ensure that those responsible are held to account.
———
ActionSA’s estimate of the RAF’s unrecorded liabilities are as follows:
1. Arising from using non-compliant accounting standard:
2. Arising from the improper use of RAF New Form 1:
Total unrecorded claimant liabilities = R508.5 billion