rabs myths debunked road accident fund replacement

The Road Accident Benefit Scheme (RABS) is a “no fault” public insurance scheme proposed by the Department of Transport as a replacement for the current Road Accident Fund (RAF).

The Department of Transport has vehemently defended its decision to implement RABS. But a closer look reveals that this new system will greatly reduce the compensation provided to road accident victims and their dependants. Here we debunk some of the common myths and misconceptions about RABS.

Myth: RABS has already been accepted/ approved

The Road Accident Benefit Scheme was first drafted by the Department of Transport in 2011, following public consultation and final approval of the proposed policy by Cabinet. The first draft of the Bill was published in 2013, with a revised bill published in 2014 to be debated in Parliament.

It's unlikely that the proposed RABS would replace the RAF before 2019, at the earliest.

Myth: RABS will provide better compensation

Providing benefits to all people injured in road accidents – including both victims and those responsible for the accidents – will likely lead to a dramatic increase in claims, along with significantly reduced benefits.

It's proposed that the RABS administration will be able to review, reduce and withdraw benefits at any time. This means that there will be no long-term financial security offered to road accident victims and their dependants under RABS.

The RAF Act provides for the payment of proved losses in the form of lump sum payments. Under the proposed RABS, beneficiaries will receive small monthly payments instead. These payments will cease after 15 years or once the beneficiary reaches the age of 60 – whichever comes first.

Benefit payments will also cease once a beneficiary returns to work, regardless of the impact that their injuries have had on their future earning potential.

Unlike the system currently used by the RAF, RABS compensation will be determined according to the national income average, with no consideration given to future earning potential.

Children and students, in particular, will suffer.

Even the most seriously injured child will be able to claim for lost earning potential only from the age of 18, and then only for a maximum 15-year period, limited to the national income average (which presently amounts to about R3 500 per month).

Students will be considered unemployed at the time of the accident and won't qualify for compensation for loss of potential earnings.

Myth: RABS will provide benefits to all road accident victims

Under RABS, the dependants of a person injured or killed in a road accident residing outside of South Africa will receive no loss of support benefits.

Road accident victims over the age of 60 will not be able to lodge a loss of wage claim with the RABS administration, even if they were employed at the time of the accident and intended or needed to continue working.

In addition, road accident victims earning more than R219 820 per annum will qualify only for emergency medical care.

Myth: RABS will reduce the burden on tax payers and the government

Although the Department of Transport seems convinced that implementing RABS will reduce the financial burden that plagued the RAF, it's to be assumed that the RABS administration will receive far more claims than the RAF. This is because of its "no fault" nature.

Even with reduced benefits for all claimants under RABS, it seems inevitable that fuel levies will need to be raised in order to cover payments to so many more beneficiaries.

Myth: RABS will result in faster payments

It's claimed that there will be no need for claimants to prove fault under RABS, but a high volume of claims and increased paperwork for the RABS administration will likely hinder payment.

The RAF is unable to cope with the current number of claims received, which leads us to doubt whether the RABS administration will be able to cope with the drastically increased workload.

Myth: RABS will not exclude lawyers

While RABS does not exclude a claimant’s right to consult an attorney, claimants will need to compile and submit their claims personally.

The lump sum payments made by the RAF enabled claimants to make use of the services of an attorney if they so wished. The payment of small monthly benefits instead of lump sums under RABS will make it impossible for the majority of South Africans to afford competent legal assistance.

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