Barbara Creecy Dissolves RAF Board Amid Deep Governance and Financial Crisis

In a decisive move aimed at restoring governance and operational stability, Transport Minister Barbara Creecy has officially dissolved the Board of Directors of the Road Accident Fund (RAF). This comes after months of mounting internal dysfunction, legal challenges, and a worsening public trust deficit in the management of one of South Africa’s most critical state-run social security institutions.

The dissolution follows extensive internal oversight, regulatory engagements, and the failure of the board to resolve long-standing governance and operational issues that have crippled the RAF’s ability to fulfil its statutory mandate—providing financial compensation to road accident victims.

“This has resulted in the loss of confidence in the board’s ability to run the entity effectively,” said the Department of Transport in an official statement issued Tuesday.

Governance Failures and Deep Board Divisions

At the centre of the turmoil has been infighting among board members, where most key resolutions were passed using casting votes rather than consensus. This decision-making by razor-thin margins has reflected deep institutional division and a lack of strategic cohesion, further weakening the RAF’s governance capacity.

The suspension of CEO Collins Letsoalo in May 2025—for failing to appear before the Standing Committee on Public Accounts (SCOPA)—was a flashpoint in the governance crisis. The suspension, which was criticised as irregular and reckless, sparked a legal challenge that further undermined confidence in RAF leadership.

The board’s failure to appoint key executives, including a Chief Claims Officer and a Head of Legal, has severely hindered the Fund’s operational functionality. These two roles are vital to processing claims, managing legal risk, and fulfilling the RAF’s primary function of compensating road accident victims.

Financial Mismanagement and SCOPA Inquiry

The RAF’s internal troubles have also attracted parliamentary scrutiny. SCOPA has launched a full inquiry into allegations of:

• Maladministration

• Financial mismanagement

• Wasteful and reckless expenditure

• General financial misconduct

SCOPA’s frustration stemmed from months of stonewalling by both the board and executive management, who were accused of providing incomplete or evasive responses to parliamentary questions.

One of the more controversial issues includes the RAF’s prolonged legal battles over accounting standards, which have drained the entity’s resources and contributed to financial instability. In addition, frequent default judgments against the RAF have only worsened its contingent liabilities, making it more difficult to maintain solvency.

Minister’s Due Process and Final Decision

Minister Creecy, who took over the Transport portfolio earlier this year, issued formal letters on 5 June 2025 to all eleven board members, informing them of her intent to dissolve the board and offering them an opportunity to respond.

“The representations were received and have been duly considered. Consequently, the board has been dissolved,” the department confirmed.

The Minister’s action aligns with her commitment to restore institutional accountability, efficiency, and public confidence in state-owned entities under the transport portfolio.

Interim Measures and Strategic Review

To avoid a governance vacuum, the Department of Transport has submitted a request to the Minister of Finance to appoint an interim functionary as the Accounting Authority, in compliance with the Public Finance Management Act (PFMA). This temporary measure will ensure continuity while the process to constitute a new board gets underway.

A public advertisement for new board members is being prepared to guarantee a transparent, merit-based selection process. In tandem, Minister Creecy has initiated the appointment of a panel of independent experts to conduct a comprehensive review of the RAF’s business processes and governance structure. This panel is expected to propose actionable reforms aimed at ensuring the long-term sustainability of the Fund.

The department has also reached out to the Special Investigating Unit (SIU) to verify whether its current probe—under Proclamation 44 of 2024—covers recent events. If not, the Minister has requested that the scope of the investigation be expanded to include developments from the past three months.

“The response from the SIU in this regard is eagerly awaited,” the department noted.

Toward Institutional Renewal

The dissolution of the RAF Board signals a turning point in how government intends to manage dysfunctional state institutions. With parliamentary scrutiny intensifying, legal accountability increasing, and public frustration rising, the Department of Transport is now under pressure to steer the RAF back to financial health and governance integrity.

For thousands of South Africans who rely on the Road Accident Fund as a safety net, the hope is that this intervention will mark the start of a credible turnaround—and not another chapter in prolonged dysfunction.