Legislation: Treasury ‘satisfied’ with new RABS Bill clauses

Publish date: 30 August 2018
Issue Number: 4534
Diary: Legalbrief Today

National Treasury is ‘satisfied’ that all its concerns about the Road Accident Benefit Scheme Bill have been ‘adequately’ addressed by Department of Transport proposals presented at last week’s meeting of the National Assembly Committee on Transport. Confirming this at a meeting of the committee yesterday afternoon, Treasury chief director for urban development and infrastructure Ulrike Britton assured members that a R2bn ‘contingent liability’ accumulated by the Road Accident Fund since 1981 will not be transferred to the proposed new benefit scheme. Instead, it will ‘move into the Budget’ – becoming a ‘real liability’ requiring a ‘fiscally sustainable’ solution, notes Pam Saxby for Legalbrief Policy Watch.

Meanwhile, Britton is confident that the separate benefit, transition and operations accounts proposed by the Department of Transport will create sufficient ‘flexibility’ for government to ‘manage’ funding ‘uncertainties’ should these arise. In this regard, the sub-clause envisaged provides for measures to ensure that ‘the ratio of actuarial value of assets to liabilities of the benefit account’ does not fall below ‘90%’. Britton nevertheless conceded that the fuel levy ‘is not a buoyant revenue stream’ and is likely to become even less so given ongoing technological developments. This notwithstanding, in her view it remains the most ‘appropriate’ source of funding in the ‘medium term’. Government will nevertheless need to consider ‘alternative’ tax measures for ensuring that, ‘longer term’, ‘all road users’ contribute towards financing the new scheme.

Interestingly, when the ANC’s Leonard Ramatlakane questioned provisions in the proposed new clauses for ‘adjustments’ to benefits in the light of fluctuating revenue sources, he was assured by Department of Transport officials that these would always be ‘upward’. He was also told ‘there is no such thing as a 100% no-fault scheme’ and that a sub-clause mooted with the aim of limiting indemnity in cases involving criminal or illegal activities does, indeed, imply the need for a fault-based approach to conducting the assessments concerned. When committee chair Dikeledi Magadzi asked a parliamentary legal adviser and her colleague from the Office of the State Law Adviser for their perspectives, they declined to comment on what is essentially ‘a policy issue’.

Against that backdrop, the committee would do well to consider the worrying implications of Britton’s reference to the importance of ‘aligning’ the Bill to draft national health insurance legislation released in June for comment. This is especially in view of plans afoot involving shared ‘infrastructure’. Concerns expressed by the ANC’s Mtikeni Sibande and the EFF’s Thilivhali Mulaudzi about the poor state of the public health system did little to allay fears about the level of service likely to be meted out under the new scheme to road accident victims from SA’s poorest communities. Mulaudzi believes the scheme should not be introduced until the entire health system has been ‘stabilised’.