Road Accident Benefit Scheme Bill: deliberations

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06 September 2018
Chairperson: Ms D Magadzi (ANC)
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Meeting Summary

The Committee went through the Bill clause by clause. Clause 40 was flagged for further engagement. although there was consensus that it and Clause 41 should be included in Clause 29 (Categories of benefits) in Chapter 6. There was no clear consensus on the age restriction for beneficiaries. Clause 46 was flagged as there was no clear response about where the RAF retrospective payments would come from.

In clause 47, the Department noted the suggestion of introducing mediation. In clause 49(1), there was consensus on the term for the Board and Appeals Committees. There was consensus to cap the fees of Board members in clause 52. It was agreed that board members declare their interests before meetings in clause 54.

Meeting report

Road Accident Benefit Scheme Bill (RABS): deliberations
The Committee continued from  Chapter 6 on Benefits. The Department was requested to present on the application of the formulas at the next meeting.

Clause 40
Mr C Hunsinger (DA) said that there was a lot of contention about this clause because it gave Members the idea that the granted benefit would terminate upon the death of the beneficiary. A verbal explanation of this clause is easily understood but the Bill is not explicit enough in communicating the intention of this clause. Perhaps the Department can look into this?

Mr N Seabi (ANC) said Part E of Chapter 6 on Benefit Review (providing for the termination, suspension, revision and substitution of the recipient of benefits) is a general provision applying to all benefits and he suggested it should be re-titled.
The Chairperson asked if Members agreed. She agreed with it.

Mr T Mpanza (ANC) said the suggestion was progressive and he proposed that Part E should be included in Clause 29 of Chapter 6 Benefits  to do away the confusion that Part E is another stand-alone benefit.

Members agreed with Mr Mpanza’s proposal.

Mr Hunsinger said that when one deals with insurance benefits, the standard process is to nominate a surviving dependent in the event the beneficiary dies. That should be the process in RABS. He proposed that there be a cut off age for dependent minors as this was normal practice in the private sector.

Mr M Sibande (ANC) said that the Committee needs to find a way to protect minors who are mentally challenged so that in the event they become beneficiaries, their monies are not abused. On the cut off age, he suggested pushing it to 23 years?

The Chairperson asked Members to decide how the Bill would deal with the cut off age for children who are beneficiaries.

Mr L Ramatlakane (ANC) suggested that the Committee stick to generally accepted practice instead of pushing the envelope. Also, this may be dealt with under other legislation and the Committee needs to locate that Act and incorporate that provision in this Bill.

Mr Mpanza proposed age 21 instead of 23. The reality is that most children, even though they may be over 18 years, may still be in school.

Mr Sibande said that the constitutionality of the age must be considered.

Mr Hunsinger objected to clause 40(1) as it states that the benefit terminates upon the death of the beneficiary. How can a minor dependent or the widow be subjected to a process of reapplying for that benefit? That benefit should continue as though the beneficiary was alive to sustain the surviving spouse and dependents. Or rather, there should be a process where the beneficiary is able to nominate the surviving beneficiary in the event that they pass on.

Mr Mpanza proposed that the clause be removed.

Mr Chris Willemse, Senior Manager at Road Accident Fund, said that there are people forging documents, faking marriage certificates and obtaining affidavits to make fraudulent RAF claims. The provision is a risk control measure and it would injure the legislation if it were not there.

Mr Ramatlakane said that given the amendment agreed to earlier about Part E, the Committee would need to amend Chapter 6.

Mr Hunsinger expressed his concern about all the prerequisites required of claimants in order to claim.

Clause 40 was flagged for revision.

Clause 46
Mr Hunsinger said the clause states that a claim shall lapse in three years. Basically there is a three year period for the dependents to be discovered before the claim lapses. The question is whether three years is enough. Should we not increase that to a point where a child is able to make the claim and to provide some leniency as well as for those who are mentally challenged?

Mr Ramatlakane suggested that perhaps a minor unqualified to lodge an application can be given a grace period until they are 18 years old. He asked if the Bill could address that.

Mr Willemse replied that this was informed by the Prescription Act – the guardian of the minor would bring the claim on behalf of the minor. If the minor is one year old, the provisions are kept alive until the minor turns 18 years and the provision would extend for another one year. A child injured at one year has a period of 17 years, plus an additional three years to claim.  

Mr Ramatlakane said that the guardian can help a minor to submit a claim. Three more years  would amount to 21 years, but what informed the three years?

Mr Willemse replied that the point was to align the period of the minor to that of an adult.

Members agreed with the provision.

Mr Sithole asked if the child would then be entitled to a lump sum payment as per RAF up until the point where RABS comes into effect.

Mr Johannes Makgotho, DoT Director: Corporate Services, replied that the claims would be dealt with in terms of the Act that applied at the time the accident occurred.

Mr Ramatlakane said that would mean there will be a call on the reserves considering this retrospective effect. He suggested that this discussion about the simultaneous running of two pieces of legislation be parked and taken up later. A discussion needs to be held about when the RAF legislation will be buried.

Mr Makgotho referred to clause 63(2).

Clause 46 was flagged for further deliberation.

Clause 47
Mr Sibande asked if a time frame would be applied to a lodged claim in 47(3).

Mr Ramatlakane asked why there were rules and regulations.

Mr Willemse replied that there are rules and regulations to ensure that the Administrator was empowered.

Mr Ramatlakane asked if the Administrator will develop its own set of rules.

Mr Willemse replied that the Administrator would be empowered to develop a set of rules. The regulations will deal specifically with payments. The rules will provide how claims are set up and processed.

Mr Ramatlakane said this legislation enabled administrative matters that Members were not privy to. What if some of the rules were counter to what Parliament intended? These rules could be either positive or negative. What is the mechanism that could then neutralise the process?

Mr Willemse replied the rules would not contravene anything that is in the Act. They would not be developed unilaterally and they would be developed through the regulations development process.

Mr Ramatlakane said that the Bill needs to be clear on the process in which the rules would be developed. This would assist Members to comment appropriately.

Mr Willemse replied that it was provided for in the Bill under section 61(3)

Mr Hunsinger shared his concerns about the provision. According to the rules and guidelines, we must keep in mind that no financial benefit would be triggered until a claim is successful so the victims would still be on their own. He asked for consideration of the option of a direct dispute because under 2(d) the Committee underscored the word ‘dispute’ so it should consider an option where a victim, before following any other channel, must be afforded an opportunity to directly challenge the Administrator’s offering because the victim is not in control of the submission of the documents.

He asked that the phrase ‘if the Administrator accepts a claim’ rather state ‘upon the Administrator accepting a claim’.  He was not comfortable with that pre-condition.

Clause 47(3) caused a lot of discomfort and he asked for a serious consideration for direct approaching of the Administrator to open the option to present the right document, or a document in addition of, instead of closing it up to an appeals process

Mr Ramatlakane said that it was not clear what time frame was stipulated to resolve the dispute, and he suggested 30 days. He suggested introducing the aspect of mediation. There must be a general provision that deals with disputes, and perhaps find a way to include mediation.

Mr Makgotho noted the suggestion.

Clause 48
Mr Mpanza said that his impression was the clause was very cumbersome because it speaks about one or more appeals committees and it has an alternate for every member. Perhaps the intention is to ensure that the work is done according to its magnitude of work. He suggested that the number of years’ experience should be reduced from 10 to 5 years, and he did not understand why there were so many committees. He asked for the number of meetings because it was not indicated.

Mr Sibande also commented that the period of 10 years would disadvantage people. He wanted to know how many people would compose the quorum.

Mr Ramatlakane remarked that a five-year period was elastic. He said five years should be the minimum.

Mr Makgotho said the proposed amendment from 10 to five years was welcomed. The rationale for having more than one appeals committee was this was new legislation and it was expected that they would deal with many claims; hence, the number of appeals committees.  

Mr Willemse replied they would want the appeals committees to be in close proximity to where various people are located, to have inland committees, and coastal committees. When the RABS Bill comes into law, it might take time to build up some of the systematic processes. One committee would not be enough.

Members agreed that more than one appeals committee would be necessary, and resolved to reduce the 10 years of practice experience to qualify as a member of the appeals committee to five years.

Clause 49
Mr Seabi asked about the rationale for the difference in the term periods for the main board and the appeals committees.

Mr Willemse replied that the intent and the skill set required for each of the two were different.

Mr Sibande asked if the full time and part time people have the same powers.  

Mr Makgotho replied yes.

Clause 51
Mr Mpanza said the quorum was stipulated as three members, so the 50 plus 1 did not work.

Mr Seabi asked if the Chairperson would vote.

Mr Ramatlakane said that the provision did not require a casting vote because the Committee would consist of 3 members, and the two members would constitute the majority for voting. A casting vote was not necessary.  

Mr De Freitas agreed.

Clause 52
Mr De Freitas was concerned that perhaps there should be a cap on the fees or remuneration but not necessarily on the number of meetings.

Members agreed with the suggestion.

The Department noted the suggestion.

Clause 54
Mr Ramatlakane asked for the position of the Department on this clause, specifically on the declaration of interest.

Mr Hunsinger asked about the process that would be undertaken where there was a conflict of interest. He proposed that there should be a standing alternate member in case a conflict of interest rose. It was not clear what would happen in the Bill when there was a conflict of interest.

Mr Willemse replied that the alternative to having alternate members could be a declaration of interests before the meeting so that board members can be privy to such information.  

Mr Makgotho noted that the suggestion would be considered.

Clause 55
Mr Sibande said he would be satisfied with the clause if people were protected.

Clause 60
Mr Hunsinger wanted to know about financial mechanism taken into consideration when applying the formulas to determine the benefits for pay outs.

Mr Willemse replied the provision is that if the funding ratio falls below 90%, the Minister must in consultation with the Minister of Finance get the fund back up to the relevant percentage. It is informed by inflation but it must be on an upward slope.

Clause 62
In 62(1), the period of imprisonment was agreed upon and extended from three to six months.

The Committee again resolved to invite the Department to present dummy scenarios in which the formulas would be applied.

The meeting was adjourned.


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