Gauteng's ‘debt collector' move against the RAF and Compensation Fund
The province is looking into other income streams to pay the e-toll debt and GFIP maintenance backlog, including liquor licences, gambling taxes, and advertising. Picture: Moneyweb
The Gauteng provincial government is appointing 'debt collectors' to put systems in place to ensure the payment of the medical costs of road accident victims and injured workers at public hospitals in the province by the Road Accident Fund (RAF) and the Compensation Fund.
'Unfortunately, for the last few years, because of inefficient systems, we have not been collecting that money,' said Gauteng MEC for Finance and Economic Development Lebogang Maile on Monday.
'It's a lot of money. We need it for our revenue,' he said.
Maile said last year that the RAF claims alone amount to about R10 billion.
ALSO READ: Gauteng aims to use RAF medical expenses claims to pay e-toll debt
Province has not started paying e-toll maintenance bill
Maile further said he does 'not necessarily' expect an adverse audit opinion from the Auditor-General (AG) because of the province's commitment to pay R4.1 billion for maintenance backlogs on the Gauteng Freeway Improvement Project (GFIP), which is not owned by the province but is a South African National Roads Agency (Sanral) asset.
Maile confirmed to Moneyweb in October 2024 that the proceeds of the RAF public hospital claims are one of the income streams to pay for the province's almost R20 billion e-toll-related debt and GFIP road maintenance financial commitments.
He said on Monday that the Gauteng government has not yet paid any of the R4.1 billion it committed to pay towards the GFIP maintenance backlog because the province is still engaged in 'a process' with National Treasury about this payment.
Maile said once that process is concluded, the province will be able to explain to the public that it is 'on course in ensuring that we meet our commitments'.
ALSO READ: R25.5 billion deficit over five years — Can RAF afford to pay out claims?
His comment about not making any payments yet towards the R4.1 billion GFIP maintenance backlog is at odds with statements made in September 2024.
Maile said then that the provincial government is starting the process of servicing the historical e-toll debt of R12.9 billion in five equal annual instalments at the government's five-year interest rate.
He added at the time that the first instalment the province was paying on 30 September 2024 amounted to R3.8 billion, consisting of R3.2 billion in historical debt and the maintenance portion of R546 million.
In terms of the memorandum of agreement signed between the Gauteng provincial government, National Treasury, the Department of Transport, and Sanral:
Gauteng agreed to pay 30% of Sanral's R43 billion e-toll debt and interest obligations, which amounts to R12.93 billion;
Gauteng further agreed to contribute R4.1 billion to the maintenance backlog on the GFIP; and
National Treasury agreed to cover the remaining 70% of Sanral's e-toll debt and interest obligations.
E-tolls on the GFIP were scrapped effective 11 April 2024 when the connection to the GFIP gantries was disconnected.
ALSO READ: RAF/Discovery judgement: the RAF did not 'win' – experts
MEC doesn't foresee problems with AG audit
Maile said on Monday the province has not yet engaged the AG about its commitment to pay R4.1 billion towards the road maintenance backlog on the GFIP, but this will happen once the process with National Treasury is concluded.
He said he did not necessarily see the payment of R4.1 billion towards assets the province did not own creating problems with the AG's audit, 'because our residents are using these roads'.
'It's not like we just are giving [away] our money. We are paying on behalf of the citizens,' he said.
Organisation Undoing Tax Abuse (Outa) CEO Wayne Duvenage said on Tuesday it does not make sense for Gauteng to pay for maintenance on assets it does not own.
Duvenage said Gauteng has roads that are in its jurisdiction and are its assets, and Johannesburg has its roads, 'and they normally stick to that'.
'Why then don't they [Gauteng] fix City of Joburg and Ekurhuleni potholes while they are about it? There are also Gauteng citizens riding on those roads,' he said.
RAF head of corporate communications McIntosh Polela confirmed last year that claims from the state, including the Gauteng provincial government, are nothing new and 'it is something that has always been happening and is currently ongoing'.
ALSO READ: Compensation Fund missing documents for 25 000 pensioners
Maile said on Monday that the province has not engaged directly with the RAF over the planned claims against the fund and does not anticipate any payment problems when it submits its claims because the law dictates that the RAF and the Compensation Fund must pay.
'All that is required is that person X was there. The onus … the ball is in our court to prove that patient X came through [the hospital] and the RAF must pay,' he said.
Maile said other income streams the province has identified to pay the e-toll debt and GFIP maintenance backlog include liquor licences, gambling taxes, advertising, and the commercialisation of some of the province's buildings and land.
'We have actually started a process now through one of our agencies to call for businesses who have ideas on what revenue streams we can get,' he said.
This article was republished from Moneyweb. Read the original here.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
IOL News
6 minutes ago
- IOL News
As a nation, we need to choose partners over politics
Two-faced Eskom punishes solar users Eskom is so much part of our lives. Homes and industries are heavily reliant on it for their power and lights, but in recent years it has become inefficient, corrupt and plundered by the greedy, often leaving the country without power. Many businesses and homes have been forced to seek alternative sources of power. Most popular of these is solar power. Although the sun's energy is clean and free, harnessing it to power our homes and industries comes at a hefty initial outlay. But as more and more homes and businesses ditch Eskom and switch to solar power, Eskom has been getting worried because fewer customers means less revenue. To offset this, it wants to punish customers who have went solar. They must be registered with Eskom and pay a fee either upfront and/or a monthly basis. How nasty can Eskom be, to punish consumers who have opted for an alternative source of energy when this problem is of its own doing? What is even more alarming is its 'gift' to Hillside Aluminium in Richards Bay. The giant aluminium company enjoys a roughly R10-billion-a-year discount, amounting to R92bn over the 10-year deal. How could the power utility grant an industrial company a discount when it is struggling to stay afloat? It doesn't make sense to punish the solar user but give a R92bn discount to Hillside! Eskom is two-faced, just like the government. | Thyagaraj Markandan Kloof The world is on a very slippery slope When good men do nothing, evil flourishes, is a fairly common quote most commonly attributed to Edmund Burke, an 18th-century Irish statesman and philosopher (although it's more likely a paraphrase of some of his writings). This is exactly what we see unfolding in the world. The recent genocidal activities by brutal Islamic Jihadi groups in Syria paint a grim picture of the sheer ignorance, hypocrisy and depravity of those who only seem to care about 'Palestinians' or what is going on in Gaza! Dissturbing clips, which are not AI generated, show demonic radical Islamists gleefully displaying decapitated heads. I understand this is very graphic to even imagine, but it is happening right now, and the world remains silent. Druze communities, along with some Christians, are subjected to the most heinous acts, but the world only condemns Israel for its efforts to deal with terrorism, while also fighting a major PR war, funded by the likes of George Soros and the UN. The more we see mobs around the world displaying the Palestinian flag, yelling death to Jews and America while our people stay silent in the face of what's happening in Syria, the more I come to the conclusion that we are in deep trouble as a global community. The lack of coverage for Christians being martyred and slaughtered like animals by what can only be described as barbaric, bloodthirsty Jihadist psychopaths is disturbing. Why is Naledi Pandor, the eloquent, yet self-righteous, former minister of foreign affairs not condemning this? Well, it's easy to understand why: She simply doesn't care about being brainwashed and used as useful idiots for Iran and its proxies, Hamas and Hezbollah!. Another very worrisome issue, is the issue of lack of consent when it comes to unelected organisations, such as the World Economic Forum and the World Health organisation, and vaccines or medical treatment. During the Covid-19 fiasco, we saw global leaders take the stage and demand that we all wear masks and be vaccinated, without allowing for any public debate, alternative medicinal ideas or without listening to extreme concerns from the public with regards to the impact of lock downs on mental health and the irreversible side effects of the vaccines they hurriedly produced. Again, why are we not speaking up about these scary issues? Are we too tired to care, or are we scared of being cancelled or publicly shamed by the pro-Palestine mobs or the vaxxers, who call us the anti-vaxxers, or conspiracy theorists? If we continue down this path of ignorance, sticking our heads in the sand like ostriches while the world falls apart, we won't have much to leave for our children and grand-children, It's all coming apart at the seams. Who will stand up and resist all this evil? | L Oosthuizen Durban ANC fails as it slides into political oblivion The unbelievable view expressed by Electricity Minister Kgosientsho Ramokgopa that electricity is becoming a luxury (IOL, July 22) should mark another milestone in the terminal descent of the ANC into political oblivion. Those milestones are in the ANC's much-revered Freedom Charter. But, one by one, the ANC has failed them. ■ 'There shall be work and security' Instead, joblessness has become the norm under the ANC. Rampant crime has made insecurity another norm as the police service has become impotent and corrupt. ■ 'There shall be houses and comfort; no one shall go hungry' Instead, homelessness, hunger, malnutrition and informal settlements are hallmarks of the ANC's tenure. Now with electricity at unaffordable prices – when it is available – cold comfort is the norm for millions.. ■ 'The people shall share in the country's wealth' Instead, unprecedented levels of impoverishment prevail, attested to by the dependence of 20 million on social grants. Instead, an elite enjoys obscene levels of affluence, while large tranches of our resources are now foreign owned. ■ 'All shall be equal before the law' Flouting the law does not apply to those in high office. Instead they are allowed to 'step aside' or be redeployed within the corrupt party which prioritises party loyalty above respect for the law and 'the will of the people". ■ 'The colour bar shall be abolished' Under B-BBEE and racial quotas the colour bar has been reinstated and reinforced in ways far more discriminatory than under apartheid .■ 'The government shall encourage national talent for the enhancement of life' Instead, education standards have plummeted and the best talents have emigrated. To cap it all, the ANC has totally reneged on and failed its own election slogan: 'A better life for all.' In a normal society there would be overwhelming public pressure for a government that has failed so profoundly to resign. But instead, the ANC seeks a diversion in the form of a 'national dialogue' in an attempt to keep itself in power. For how much longer and how much further will this fiasco be allowed to continue? | DR DUNCAN DU BOIS Bluff Choose partnership over politics It's rare to speak from the heart without backlash, but South Africa remains a troubled country. Crime, corruption, and unemployment prevails, while government leaders promote a R700-million National Dialogue, yet fail to act against the corrupt in their own ranks. Ordinary South Africans want renewal through peaceful evolution to a united, prosperous nation. But our political leadership chooses self-sabotage, jeopardising key relationships, such as our government's pursuit of an ICJ case against Israel, souring relations with a natural ally whose values and strengths mirror our own. Israel and South Africa are both beacons of democracy, rooted in Judeo-Christian values. South Africa's transition from apartheid and Israel's resilience offer beneficial lessons in reconciliation, innovation, and economic development. While Israel has emerged as a global leader in tech, water security, and food innovation, we remain stuck with dysfunctional government departments and poor service delivery. Israel reclaims 86% of wastewater, leads in desalination, and boasts low unemployment, even amid conflict. In contrast, South Africa's official unemployment rate sits at 32.9%. Why reject potential partnerships that could uplift our economy and society? Voters denied any party a majority in 2024, a clear sign they reject our country's current trajectory, yet the government pours more funds into the ICJ case, despite no genocide ruling. This isn't leadership. It's political ideology that undermines our future. We need pragmatic diplomacy that puts South Africans first. Israel is not our enemy. It can be our greatest ally. It's time to choose partnership over politics. | Daniel Jacobi Executive Director at the South African Friends of Israel Beat app fatigue and earn your space Every year, over 250 000 mobile apps are launched across Apple and Google's app stores. Yet average smartphone users interact with only nine apps per day. WhatsApp is almost always one of them, boasting over 2.8 billion users globally and a 93% penetration rate in South Africa. Despite this, companies continue to invest in standalone apps that most users simply avoid, or delete after a single use. This growing app fatigue demonstrates ineffective business strategies that are disconnected to the customer behavioural economy of today, and refuses to meet customers where its most convenient for them. Enter WhatsApp smartbots. These AI-powered chat interfaces are fundamentally reshaping how brands engage consumers by offering numerous services: Like buying tickets, applying for loans, or searching for properties, all within the familiar WhatsApp interface. No downloads, logins, or clunky interfaces. Beyond customer convenience, smartbots also enable real-time behavioural insight for South African businesses. Every click, pause, or query becomes golden data that local companies can leverage to improve services, build trust, and personalise the experience. For industries like financial services and real estate, this infrastructure results in faster processes and more insightful interactions with customers. Businesses need to stop contributing to app fatigue and start earning their space in our conversations. In a world oversaturated with apps, the path forward lies in simplicity, relevance, and meaningful engagement. | Jonathan Elcock Co-founder and CEO at DAILY NEWS
The Citizen
36 minutes ago
- The Citizen
Auditor-General's war on waste and corruption yields R4.5bn
But it's a war that is far from won. A good outcome, but Auditor-General Tsakani Maluleke seems exasperated at the lack of accountability among those charged with spending public money. Image: Brand South Africa Auditor-General (AG) Tsakani Maluleke says R4.5 billion has been recovered over the last five years after being flagged as irregular. Some of this came from the recovery of part of the R700 million awarded by the Energy and Water Sector Education and Training Authority (Seta) for training programmes where little to no value was delivered, and in violation of National Treasury rules which require evidence of services rendered before payment. The R4.5 billion recovery over five years may seem like chump change given the magnitude of the problem confronting the AG. Its latest report on local government identifies R8.74 billion lost in 285 municipalities as a result of non-compliance with the law and suspected fraud. Speaking at a Centre for Development and Enterprise (CDE) presentation, Maluleke seemed exasperated at the lack of accountability among those charged with spending public money. 'I've been here at AG for 13 years and we've looked at this from every direction and concluded we have to look at governance. ALSO READ: Government overspent or wasted R49 billion since 2019, says Auditor General 'Basic management disciplines are not in place,' she said. Asked what improvements she observes, Maluleke pointed to the reduction in the number of disclaimers in AG audit opinions – down from 28 to 14 – and the not-insubstantial R4.5 billion recovery in funds. The recovery operations were fortified by changes in the law in 2019 that gave the AG expanded powers to demand action and accountability for material irregularities. These include payments for goods and services not received or of poor quality, penalties imposed on municipalities for non-payment of Eskom and water board bills, and revenue lost due to unbilled accounts or unrecovered debts. The AGSA's expanded powers allow it to issue stronger recommendations and refer cases to bodies like the Hawks or the Special Investigating Unit for disciplinary action. ALSO READ: 'Culture of lack of accountability': Government departments, SOEs rack up R120bn in irregular expenditure No easy task The perception of auditing as a safe and sedentary occupation was shattered by the recent murder of Ekurhuleni's senior auditor, Mpho Mafole. Mafole, a former Auditor-General South Africa (AGSA) staffer, was investigating R2 billion in missing funds when he was gunned down. 'We're under threat of violence every day,' said Maluleke. 'We must get to the bottom of who did what and why. Our thoughts are with his family.' With 4 000 staff, including 900 chartered accountants, the AG's office conducts over 1 000 audits annually across all public institutions, as mandated by Chapter 9 of the Constitution. These audits assess the credibility of financial statements, performance against objectives, compliance with the rule of law, and systemic issues in governance. The reports are intended for citizens, parliamentarians, ministers and departmental management, backed by actionable advice to improve operations. AGSA is one of the country's most respected institutions, having gained public trust by naming and shaming those involved in squandering or looting funds. Its independence is constitutionally guaranteed, making it one of only two global audit bodies with full autonomy, according to the World Bank. ALSO READ: Decisive intervention needed for municipal performance — BLSA Municipalities still an issue Municipalities, however, remain a weak link, with mayors, municipal councils and executive teams failing in their oversight duties. This extends to the provincial level, where many of the responsible leaders don't even bother to read the AG reports. 'When councils are unstable, performance suffers, budgets go unfunded, and infrastructure crumbles,' said Maluleke. Many municipalities misallocate grant funds to pay debts, like last year's Eskom bills, or hire underperforming staff instead of maintaining critical services such as water and electricity. This creates a vicious cycle: economic strain reduces ratepayer payments, squeezing municipal cash flow and crowding out essential infrastructure spending. Operation Vulindlela, set up by President Cyril Ramaphosa to reform the economy as a trigger for growth, shows spending on salaries in SA's cities increased 84% between 2010 and 2014, while property rates and service charges have virtually doubled over the same period. Of the eight metros in SA, only Cape Town achieved a clean audit, meaning it has credible financials and no significant non-compliance. Three metros received unqualified audits, but four – including Johannesburg – failed to present reliable financial statements. ALSO READ: SIU finds no corruption in City of Joburg but Auditor-General has concerns City of Joburg Joburg's deterioration at the hands of squabbling councillors is visible to the eye but preceding this was a steady weakening in its institutional capacity, marked by poor project management and irregular spending – including the award of R972 million in tenders to family members linked city officials and councillors for the extension of the BRT/Rea Vaya bus system in 2023. This was flagged by the AG for its potential conflicts of interest, though she says there is no law that specifically prohibits the award of tenders to close family members or business associates. The real question was whether the City of Joburg failed in its oversight duties. 'Joburg has high levels of irregular spending and does not seem to be getting [it] under control. The [city] council, speaker and mayor don't seem to be decisive,' she said. Maluleke attributes this to poor financial management, noting that municipalities often lack basic disciplines like matching budgets to performance goals. Operation Vulindlela's latest report (July 2025) echoes this, advocating for financial reforms to stabilise municipalities through better revenue collection and governance. High salary costs exacerbate the problem, with some municipalities prioritising personnel over infrastructure, a trend Maluleke links to weak councils fostering a culture of impunity. ALSO READ: Eastern Cape local municipality is the worst run – Auditor General Some bright spots It's not all doom and gloom. Midvaal in Gauteng, with clean audits for over a decade, exemplifies strong stewardship, maintaining quality roads and services. Maluleke's audit staff complain of speeding tickets because the roads in Midvaal are in such good order. The municipality's responsiveness is what sets it apart, said Maluleke, contrasting this with poorly run municipalities where living conditions deteriorate. The 2024 Public Procurement Act aims to close loopholes using technology for better oversight, but Maluleke cautions that no legislation works if rules are flouted without consequence. She advocates for stronger codes of conduct, skilled leadership, and internal controls to enforce accountability. AGSA has come under political attack from different quarters but remains steadfast, protected by rigorous, evidence-based processes. Maluleke doesn't sign reports herself; a qualified team ensures objectivity. 'We should never tolerate [audit] disclaimers,' she said. By referring cases to investigative bodies and pushing for governance reforms, there is hope that the war against impunity and waste will eventually win the day. But we're still a long way from that. This article was republished from Moneyweb. Read the original here.
The Citizen
18 hours ago
- The Citizen
The smart move: How having life cover when you're young is a power play for your future
While living benefits are important, it is still important to have life cover if you have parent, child dependants or debt. Concerts, weddings, and wild adventures – your crew is making memories. What about your future? Life insurance may not be on your radar yet, but locking it in early could be the smartest financial decision you ever make. This Savings Month (July), Discovery Life shares insights on why young professionals should consider the invaluable benefits of life cover. When you're in your early 20s to mid-30s, life insurance is probably the last thing on your mind. It's easy to think, 'I'll deal with that later'; 'I already have cover through work'; or 'I'm healthy now, so I'll wait'. However, waiting for 'later' could come at a large cost to those with the majority of their future earnings still ahead of them. Do you have a plan if you're no longer able to earn a salary due to a life-changing health diagnosis or a permanent disability? How would you pay your rent or bond, for groceries, medical aid, car and family responsibilities? 'What many young people are unaware of is that life insurance offers far more than just cover that pays out when someone passes away. Life insurance is an incredibly powerful tool and can be a financial safety net if a severe illness or disability stops an individual from being able to earn an income,' says Gareth Friedlander, Discovery Life Deputy CEO. Younger than 30? You're probably underinsured A 2022 Association for Savings and Investment South Africa (ASISA) Life and Disability Insurance Gap Study revealed that the average income earner aged 30 and younger is underinsured. This means they will be unable to maintain their own, or their dependents' current lifestyle if they become disabled or pass away. The average income earner aged 30 and younger earns a little over R10,000 per month, but typically needs more than R2.7 million in disability cover to maintain their standard of living post claim. On average, they only have disability cover of around R1 million, leaving an insurance gap of R1.7 million. 'The insurance gap for South Africans under 30 is concerning,' says Friedlander. 'Having holistic life cover in place that includes income protection, severe illness cover, and disability cover when you're young is one of the smartest things you can do.' How living benefits are an insurance lifeline for young people 'Along with paying out an insured amount to your loved ones if you pass away, life insurance can also protect you against financial risk if something unpredictable happens while you're alive,' explains Friedlander. The three main 'living benefits' are income protection, severe illness cover, and disability cover. Income protection – This benefit pays you a regular income if you are unable to work due to injury, illness or disability. Severe illness cover – Severe illness cover pays out a lump sum based on the severity level of the illness and can be used to cover costs such as treatment costs and lifestyle modifications. Disability cover – Disability cover pays out a lump sum if you become disabled. It can help cover any associated costs such as buying or maintaining specialised medical equipment, lifestyle modifications or settling debt. Alarmingly, severe illnesses like cancer are increasingly affecting younger people. Over the past 30 years, cancer rates in the G20 nations (which includes South Africa) have increased faster for 25 to 29-year-olds than any other age group – by 22% between 1990 and 2019. This is according to the Financial Times, which analysed data from the Institute for Health Metrics and Evaluation at the University of Washington School of Medicine. Discovery Life's Claims Experience for the 2024 calendar year shows that for severe illness claims, cancer was the leading claim cause at 41%, with heart and artery claims next at 16%, followed by nervous system claims at 13%. Of the severe illness cancer claims, skin cancer was the top cause among men aged 40 and younger (44%), while breast cancer accounted for 43% of cancer claims among women aged 40 and younger. Cancer was also the largest cause of disability claims in this age group (29%). Friedlander adds that two in five income protection claims were paid to clients aged 40 or younger in 2024. One in four of these were for permanent conditions. However, these permanent claims made up 67% of the total rand amount paid out. This highlights the value of income protection, especially for permanent claims where these clients will receive an income going forward. Musculoskeletal claims make up almost one-third of these claims and include, for example, injuries to or surgery for the back and neck, ankles, hands, etc. While living benefits are important, it is still important to have life cover where people have parent or child dependents or debt. Of the death claims in 2024 for those aged 40 and younger, motor vehicle accidents (18%) were the largest cause, followed by heart and artery conditions (16%), and then cancer and trauma, each contributing 14%. For these younger ages, 42% of life cover claims were due to unnatural deaths, highlighting the uncertainty of life. 'Taken altogether, these insights highlight the growing importance of holistic life cover for young people that includes living benefits,' notes Friedlander. The younger and healthier you are, the cheaper your premiums 'Young people also need to know that life insurance premiums are mostly determined by age and health. The younger and healthier you are when you apply, the cheaper your cover is,' explains Friedlander. When you take out life insurance at younger ages, your risk is lower, and you can spread the payments over a longer term. This means that your premiums at earlier ages subsidise your premiums later, resulting in more sustainable premiums at older ages. Waiting to take out cover when you're older, or after you're diagnosed with a chronic condition or severe illness, means higher premiums or potential exclusions from cover entirely. 'Not only does getting life cover when you're young protect your future self and your loved ones, but it also sets a solid foundation for long-term financial wellbeing. Getting life cover when you're young isn't just about planning for the worst. It's about making a confident move that secures your financial journey and your ability to protect what's most important to you. Future you will thank you,' concludes Friedlander. Ready to future-proof your financial plan? Learn more about Discovery Life's suite of protective cover and benefits that reward healthy living and safeguard your financial future.
