Treasury defends increase in Road Accident Fund levy
More than half the fuel levy increase will go to the fund, which is a ‘growing problem’
Treasury officials defended the budget’s extra 30c a litre contribution to the Road Accident Fund on Friday, saying it was necessary to help address the "massive deficit" in the fund.The Road Accident Fund pays compensation for those injured in motor vehicle accidents.Of the 52c a litre increase in the fuel levies announced in the 2018-19 budget, 30c would go towards the Road Accident Fund "to stabilise short-term liabilities at about R8.5bn per year", the acting deputy director-general in Treasury’s budget office, Ian Stuart, told a joint meeting of Parliament’s finance committees.Short-term liabilities are those where claims have been finalised but not yet paid.Stuart’s comments were part of the response Treasury gave to public hearings held this week on the budget proposals.Stuart said the deficit in the Road Accident Fund was a growing problem that had to be addressed. Actuarial estimates project the fund’s total liability to grow to R355.3bn by 2020-21 — compared with projected...
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