Inside the RAF | Major changes to crash compensation – who wins and who loses under RABS
The Road Accident Benefit Scheme (RABS) Bill is presented by the Department of Transport (DoT) as a measure aimed at protecting the vulnerable, addressing poverty, and defending human rights as expressed in Chapter Two of the Constitution – so why is it deemed controversial?
The revival of the RABS Bill is a departure from South Africa’s existing common law compensation system administered by the Road Accident Fund (RAF).
After months of uncertainty and the abandonment of the RAF Amendment Bill, Deputy Transport Minister Mkhuleko Hlengwa confirmed that the RABS Bill is being reintroduced as part of necessary legislative reforms.
Proponents of the RABS argue the shift is important because the current RAF system is financially unsustainable, inefficient, and vulnerable to widespread abuse. The RABS Bill proposes replacing the existing third-party insurance model with a defined-benefits social security scheme.
Here is what is changing and why these proposals have sparked debate over sustainability versus fairness, exclusion and mounting concerns.
What is changing?
The RABS Bill was initially released in 2017 but rejected by the National Assembly in 2020. Now, it proposes four huge changes. According to documents and statements from the government, this is what South Africans can expect.
Shift to no-fault cover
The RABS Bill proposes establishing a no-fault social insurance scheme.
Under the current RAF, compensation relies on proving fault on the part of another driver, and payment is adjusted based on contributory negligence.
However, RABS removes the requirement to establish fault and ensures expanded access to benefits for all road users. This suggests that accident victims qualify for benefits regardless of who caused the crash.
While RABS proponents argue this expands coverage to thousands of previously excluded passengers and victims, there are concerns that the no-fault system means negligent drivers would qualify for the same compensation as innocent victims.
However, the RAF stresses that RABS does not indemnify reckless and drunken drivers from criminal prosecution, which will be pursued by other State organs.
No pain-and-suffering damages
The RABS Bill explicitly excludes compensation for non-economic damages.
- Under RAF, claimants can claim general damages (compensation for pain, suffering, and disfigurement).
- Under RABS, no general damages will be paid.
The exclusion of general damages is argued to be necessary to curtail expenditure and ensure the scheme remains viable and sustainable, given the wider coverage resulting from the removal of the fault requirement.
Capped and structured benefits
The RABS moves away from lump sum payments toward defined and structured benefits, intended to ensure financial affordability.
- Payment structure: Instead of receiving a single lump sum payment (RAF), RABS proposes small monthly benefits paid for a fixed period.
- Income capping and termination: Loss of income benefits under RABS is limited. Previous projections suggested a cap of R280,000 annually. Benefit payments will cease once a beneficiary returns to work, regardless of the impact the injuries may have on future earning potential.
- Benefits for the poor: While the current RAF system results in zero compensation for dependents who cannot prove the deceased breadwinner’s income, RABS claims that it provides that such beneficiaries will receive a benefit based on an assumed income equal to the average annual national income specified in the legislation.
Exclusion of undocumented foreigners and age restrictions
The RABS Bill introduces strict eligibility criteria based on residency and age.
- Exclusion of non-citizens: RABS proposes denying benefits to non-South African citizens or those without permanent residency. Non-citizens would only be able to claim compensation for emergency medical services.
- Age limits: Claims for income and family support benefits are restricted to persons below the age of 60. Road accident victims over 60 cannot claim for loss of income, even if employed. Furthermore, surviving spouses lose support payments once they turn 60 or after 15 years, whichever is shorter.
- Students/minors: Students are automatically regarded as unemployed and would recover negligible benefits, as RABS excludes compensation for loss of future earning potential. Minors only qualify for income support benefits from age 18 onwards.
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The RABS Bill Explained
Sustainability vs. Fairness for Road Accident Victims
What is the RABS Bill?
The Road Accident Benefit Scheme (RABS) Bill is a proposed new system to replace South Africa’s current Road Accident Fund (RAF). It aims to shift from a fault-based compensation system to a no-fault social security scheme.
Four Major Changes Proposed
1. Shift to No-Fault Cover
Benefits are paid to all road users, regardless of who caused the accident.
Pro: Expands access to benefits for thousands of previously excluded victims.
Con: Negligent and drunk drivers could qualify for the same benefits as innocent victims.
2. No “Pain & Suffering” Damages
Compensation for non-economic damages (general damages) is completely excluded.
Pro: Argued to curtail expenditure and ensure the scheme remains financially sustainable.
Con: Victims receive no compensation for pain, suffering, or disfigurement.
3. Capped & Structured Benefits
Lump sum payments are replaced with small, defined monthly benefits for a fixed period.
Con: Income benefits are capped (e.g., ~R280,000 annually).
Con: Payments stop once a beneficiary returns to work, regardless of future earning potential.
4. Strict Exclusions
New eligibility criteria based on residency and age are introduced.
Excludes: Non-South African citizens (except for emergency medical care).
Restricts: Persons over 60 cannot claim for loss of income.
Restricts: Students/minors get negligible benefits as “future earning potential” is excluded.
Constitutional & Legal Concerns
- Right to Equality: The Bill faces challenges over potential unfair discrimination based on age (the over-60 rule) and nationality (exclusion of foreigners).
- Access to Justice: By paying small monthly sums, the Bill effectively removes contingency-fee agreements. This makes it unaffordable for most victims (especially the poor) to get legal representation.
- Judicial Review: Access to the Courts is severely curtailed, replaced by limited internal appeals.
- Reduced Protection: The shift from lump sums to small, capped monthly payments (which can be terminated) dramatically reduces the financial protection for seriously injured victims.
RAF vs. RABS: At a Glance
| Feature | RAF (Current System) | RABS (Proposed System) |
|---|---|---|
| Basis of Claim | Fault-Based: Must prove another driver was at fault. | No-Fault: Benefits paid regardless of who was at fault. |
| Negligent Drivers | Cannot claim if 100% responsible. | Can receive benefits, same as innocent victims. |
| Payment Structure | Lump sum payment. | Small, monthly payments for a fixed period. |
| “Pain & Suffering” | Allowed. Claimants can get “general damages”. | Excluded. No compensation for non-economic damages. |
| Citizenship | Any person injured on SA roads can claim. | Only SA citizens/permanent residents. (Foreigners get emergency medical only). |
| Age Limits (Income) | No age restriction for loss of income claims. | Persons over 60 cannot claim for loss of income. |
| Future Earning (Students) | Can be claimed. | Excluded. Students/minors get negligible benefits. |
| Legal Representation | Accessible via contingency fees taken from lump sum. | Effectively eliminated, as fees cannot be recovered from small monthly benefits. |
Constitutional concerns
So we know what is changing and how, but it’s also worth noting that the changes pose constitutional concerns. Specific exclusions and limitations raise serious concerns regarding the right to equality and access to justice, namely:
The Right to Equality (Section 9)
- Exclusion of foreigners: The denial of comprehensive benefits to non-South African citizens or those without permanent residency raises constitutional questions regarding equality and non-discrimination.
- Age discrimination: The automatic restriction of income support and family support benefits to persons below the age of 60 and the subsequent loss of support payments for surviving spouses once they turn 60 are viewed as potential acts of unfair discrimination based on age.
- Reward for negligence: There are growing concerns that the Bill grants reckless and drunk drivers the same compensation as innocent victims is unethical.
The right to social security and access to justice
In addition to the exclusion of foreign nationals or age discrimination, the structure of RABS is criticised for undermining victims’ access to fair compensation and legal support:
- Diminished financial protection: The reduction of compensation from lump sum payments to small, fixed, monthly benefits dramatically reduces the overall financial protection available to road accident victims. Furthermore, benefits can be suspended or terminated at the Administrator’s sole discretion.
- Elimination of legal access: Because RABS shifts to structured monthly payments directly to the beneficiary, attorneys would find it difficult to recover their fees, which are currently taken from lump sum settlements (up to 25%). This will effectively take away access to legal representation for most accident victims, especially those living in poverty, who rely on contingency fee agreements.
- Curtailing judicial review: Access to the Court is severely curtailed under RABS, with only limited rights of internal appeals and review provided.
Sustainability vs. fairness
The tension surrounding the RABS Bill lies between the state’s duty to ensure a financially sustainable system and its duty to provide fair, comprehensive relief to accident victims. We break down arguments for RABS and counter-arguments against the Bill.
| Argument for RABS | Counter-Argument Against RABS |
| RABS is necessary to address the RAF’s growing deficit and inability to meet its obligations. Capped and structured payments ensure affordability and sustainability | The no-fault system will cause claim volumes to surge, potentially causing annual loss-of-support claims to increase drastically. |
|
Removing the fault requirement provides expanded access to benefits, especially for those currently excluded, like unemployed breadwinners and passengers. Capping reduces the cross-subsidisation of wealthier claimants by poorer claimants
|
Funding the scheme would likely require steep hikes to the fuel levy. Taxpayers must also support both RAF and RABS simultaneously during the transition |
| Structured payments ensure funds are used for intended purposes (medical and rehabilitation), preventing the alleged abuse of lump sums on “frivolous things”. Benefits are also protected from creditors. | Eliminating lump sums and pain-and-suffering compensation dramatically reduces the financial compensation available to the most seriously injured. |
| RABS proposes that staff will assist claimants with forms, simplifying the process, and claimants will not be denied the right to use an attorney. | The structured payment model effectively means attorneys cannot afford to take on claims, leaving victims unable to submit and substantiate complex cases. |
How would it affect various people?
The changes proposed by RABS would alter the compensation landscape for several groups:
Lawyers and legal experts
Legal experts condemned the RABS Bill, warning that the changes would undermine the rights of road accident victims.
The elimination of lump sums in favour of small monthly payments means attorneys cannot recover their costs, eliminating access to legal representation for the majority of claimants. Without legal support, injured individuals might be left alone to navigate a complex and bureaucratic system.
Injured workers and students
Injured workers, particularly those who rely on income support, face uncertainty:
- The elderly worker: We know that under RABS, road accident victims who are over 60 at the time of an accident won’t be able to claim for loss of income, even if they were actively employed. This would put them in a difficult position if they are faced with a situation.
- The unemployed/informal trader: Under the current RAF, those unable to prove income receive nothing. Under RABS, they are better off, as they are deemed to have earned the average annual national income, thereby receiving a benefit (e.g., around R3,500 per month).
- The seriously injured student: Students are automatically regarded as unemployed. Since RABS excludes compensation for loss of future earning potential, seriously injured students would recover negligible benefits, undermining their future ability to work.
Foreign nationals
Currently, anyone injured on South African roads can claim compensation.
Under RABS, the proposed denial of benefits to non-South African citizens or those without permanent residency raises constitutional questions. These individuals would only be able to claim compensation for emergency medical services.
RAF vs RABS
According to DSC Attorneys, the existing RAF has been subject to administrative and financial mismanagement. It said it has also been accused of not adequately protecting claimants’ personal information.
We thoroughly break down the differences between the RAF and the proposed RABS.
| RAF (Current system) | RABS (Proposed system) | |
| Basis of compensation | Fault-based system where claimants must prove another party was at fault before compensation is awarded. | No-fault system – benefits paid regardless of who caused the accident. Aims to simplify and speed up claims processing. |
| Treatment of negligent drivers | Negligent drivers cannot claim compensation if solely responsible for the accident. | All victims, including negligent drivers, can receive benefits |
| Financial structure | Compensation is usually paid as a lump sum, offering immediate financial relief. | Provides monthly income support for a fixed period. |
| Types of compensation | Allows claims for non-economic damages, which may include pain, suffering, and disfigurement. Recognises emotional and psychological impacts. | Does not allow claims for general (non-economic) damages. Focuses on essential benefits only. |
| Eligibility – Citizenship | Any person injured on South African roads can claim, regardless of nationality. | Non-South Africans can only claim emergency medical services. |
| Eligibility – Age | No age restriction for loss of income or support claims, and elderly victims remain eligible. | Persons over 60 cannot claim for loss of income or family support. |
| Support Duration / Payment Cessation | Payments do not automatically stop when beneficiaries return to work, allowing continued financial stability. | Benefits cease once the beneficiary returns to work, risking financial instability for those recovering. |
| Access to Legal Representation | Claimants can hire attorneys who recover fees from lump sum settlements (contingency arrangements). | Restricts legal representation since legal costs cannot be recovered from the monthly structured benefits. |
| Overall Aim | Offers broader coverage, but is often slow and bureaucratic due to fault-based disputes. | Reduced compensation scope and limited access to legal and long-term financial support. |
We have reached out to Hlengwa’s office, but no response was received at the time of publishing and contacted lawyers have refused to comment.
IOL