RAF inquiry becomes major test of parliament’s powers

The inquiry by the standing committee on public accounts (Scopa) into the Road Accident Fund (RAF) has become a defining test of parliament’s constitutional oversight powers, laying bare the fragility of governance in one of the state’s most financially distressed entities.

What began as a procedural resolution in June has evolved into a weeks-long confrontation between legislators, suspended executives and forensic investigators, with implications that extend beyond the fund itself.

The committee’s decision to escalate the matter into a formal inquiry followed months of failed attempts to secure reliable information from the fund. Members grounded the process in section 55 of the constitution and proceeded under the Powers, Privileges & Immunities of Parliament & Provincial Legislatures Act to compel attendance when necessary. Chair Songezo Zibi said the committee will exhaust all avenues to secure testimony before proceeding under the act.

Hearings have interrogated contested accounting treatments, the presentation of liabilities and procurement controls. On October 8, MPs engaged the National Treasury and the auditor‑general to clarify persistent financial and compliance failures.

Officials told the committee the fund attempted to resolve its crisis by changing accounting standards, a move that left the RAF with successive adverse audit outcomes and ongoing disputes with the auditor-general.

The fund’s switch in 2021 from insurance contracts to social benefits (Ipsas 42) was later ruled invalid by the courts yet remained central to its reporting. CFO Bernice Potgieter defended the fund’s position in testimony, but media analyses drawing on Accounting Standards Board materials challenged aspects of her account.

The Special Investigating Unit (SIU) briefed Scopa on October 10, outlining progress, preliminary findings and systemic recommendations. It flagged serious deficiencies in procurement and contract management and raised concerns about interference in its investigation.

INTERVIEW: RAF collapsed due to weak leadership and failed oversight, ActionSA’s Beesley says

The SIU confirmed its mandate to collect evidence, institute civil litigation and refer criminality to the National Prosecuting Authority (NPA), underscoring that the RAF’s problems were systemic rather than isolated lapses.

The most contentious development has been the refusal of former CEO Collins Letsoalo to appear despite a formal summons for November 25 and 26. After multiple failed attempts to serve him at known addresses, parliament resorted to substituted service, including publication on official platforms.

Letsoalo did not attend and publicly questioned the inquiry’s legality. Scopa members said they will give him one more opportunity before proceeding; several called for criminal charges under the act’s offence regime.

ActionSA’s Alan Beesley said Letsoalo has “shown parliament a middle finger”, while DA MP Patrick Atkinson argued the committee has “no other choice” but to lay criminal charges.

Scopa has since resolved to seek the speaker’s concurrence to lay a criminal charge against Letsoalo for failing to appear after being lawfully summoned.

Since the inquiry began, several key findings have emerged.

First, the RAF’s accounting practices have been shown to be unreliable, with liabilities misstated and audit outcomes consistently adverse. Second, procurement and contract management are riddled with weaknesses, with the SIU pointing to systemic failures.

Third, executive conduct has undermined governance, with performance bonuses paid during fiscal distress and senior officials resisting accountability. Finally, the outright defiance of a parliamentary summons by Letsoalo has escalated the inquiry into a test case for the enforceability of oversight powers.

The inquiry has therefore become more than a review of one fund’s finances. Politically, it pressures the executive to act on Scopa’s eventual findings. Legally, it raises prospects of criminal referrals and civil recovery actions. Administratively, it underscores the urgent need for reform of statutory entities whose liabilities pose material risks to the fiscus.

For claimants, the RAF’s instability threatens access to compensation and undermines confidence in statutory mechanisms designed to protect accident victims.

The committee’s next steps will determine the inquiry’s significance. If parliament compels Letsoalo’s testimony and reconciles the fund’s figures against independent verification, it could set a precedent for rigorous scrutiny of distressed public entities.

If not, defiance of a lawful summons will stand as a limit case for oversight without consequence, weakening parliament’s credibility in enforcing accountability.