Creecy defends suspension of RAF executives amid misconduct claims

Transport Minister Barbara Creecy has defended the precautionary suspension of the Road Accident Fund’s acting CEO and chief finance officer.

Responding to parliamentary questions from EFF MP Mazwi Blose, Creecy said the pair was suspended amid several allegations of financial misconduct that were brought to the attention of the RAF interim board.

In November, the board placed the acting CEO, CFO, chief governance officer, and the head of the office of the CEO on precautionary suspension, effective immediately.

It decided to allow for an independent and unhindered investigation into certain administrative and governance matters.

“These precautionary measures do not in any way constitute a finding of wrongdoing against the affected officials but are intended to ensure the integrity and transparency of the investigative process,” said the board.

According to Creecy, the board resolved at its meeting on September 19 to institute disciplinary action against the implicated executives.

She stated that the Public Finance Management Act (PFMA) requires the board to ensure that the RAF maintains effective, efficient, and transparent financial and risk-management systems.

The PFMA also required the board to take effective disciplinary steps where employees undermine those systems or incur irregular or wasteful expenditure.

“The interim RAF board accordingly exercised its statutory powers when it resolved on September 19, 2025, to act on the various allegations of financial misconduct and suspended the implicated executives whose conduct has caused serious risks to the RAF’s governance, finances, and reputation,” she said.

The minister added that the board was not only empowered to place the acting CEO and the CFO on precautionary suspension, but it was also empowered under the contract employment concluded with the two executives.

“The suspension of the acting CEO and CFO was, therefore, implemented not as a punitive action, but as a governance necessity and restored stability and accountability within the RAF’s financial governance environment,” said Creecy.

Replying to another question by ActionSA Alan Beesley on steps taken to ensure the financial statements of the RAF were restated to accurately reflect true liabilities, the minister said the entity has started the process to develop appropriate accounting policies in accordance with the Generally Recognised Accounting practice (GRAP) reporting framework for 2025/26.

Engagements with the Accountant General at the National Treasury were under way to ensure policies developed were appropriate and complied with the GRAP reporting framework.

Creecy also said the interim board has various remedies that will be pursued to hold the previous and current board accountable.

“The executive authority plans to ensure that the boards of directors are held accountable for their actions by utilising the Special Investigating Unit’s ongoing investigation reports and other available information.

“The previous board was dissolved as a measure to ensure accountability for the transgression of fiduciary duties.”

The RAF changed its accounting policy without permission from the Accounting Standards Board, resulting in the recognition of claims liabilities and claims expenditure being understated.

Their decision led Auditor-General Tsakani Maluleke to issue a disclaimer of audit opinion in December 2021, and her action sparked litigation by the RAF.

Creecy has repeatedly urged the RAF to withdraw the action and instructed the interim board to ensure it puts an end to what she called a “horror show”.

Finance Minister Enoch Godongwana said, despite the RAF’s change in accounting policy, the National Treasury has consistently published its estimates of the RAF’s liabilities as part of the contingent liabilities in the consolidated fiscal framework.

“A full actuarial evaluation of the RAF liabilities is required to understand the nature and extent of its total liabilities, as the largest share, previously, was for claims incurred but not yet reported, which is an actuarial estimate of its liabilities,” said Godongwana.

Asked about steps taken to protect legitimate claims that were unlawfully rejected, Creecy said the RAF did not believe the claims were unlawfully rejected.

She added that her department was currently in the process of reintroducing the Road Accident Benefit Scheme Bill, which will reclassify the fund as a social benefit scheme and institute a no-fault compensation regime for claimants.

“The current dispensation is unaffordable due to the process of proving fault in settling the claims of damages. The department is, therefore, intending to replace the current RAF dispensation with the Road Accident Benefit Scheme, prescribing a no-fault benefit dispensation to ensure financial stability of the fund,” she added.

mayibongwe.maqhina@inl.co.za