New bill could cause fuel levies to rise by another 75%: legal expert

If objections are not tabled following the public consultation process currently taking place around the country – and the proposed Road Accident Benefit Scheme (RABS) bill goes ahead – we will see fuel levies rising by an estimated 75% and reduced compensation being provided to road accident victims and their dependents.

This is according to partner at DSC Attorneys, Kirstie Haslam, who has been actively involved in parliamentary debate surrounding the proposed ‘no fault’ public insurance RABS bill that is now before parliament as a replacement for the current Road Accident Fund (RAF).

“Other than the dire affect the bill will have on accident victims claims, the failure to highlight the anticipated and unavoidable increase in the fuel levy to the public in order to meet the funding requirements for RABS is especially disturbing, considering the latest outcry about the price of fuel and the fuel levy itself,” she said.

She added that an analysis of the department’s own actuaries’ estimation of the implications on the fuel levy in terms of the anticipated funding requirements for RABS reveals that significant increases to the fuel levy are anticipated, bearing in mind that both systems, i.e both RABS and RAF, would have to run side-by-side for an estimated minimum of 8 to 10 years.

Haslam said that even on this conservative estimate, the fuel levy is set to increase by an initial 75% – which, even after ten years, will taper to a still significant one and a half times what it currently is.

“This has not been explained to the public to date and may very well influence their attitude to the RABS bill as it is being sold to them,” she said.

“The focus should be on fixing the current system as opposed to implementing something which is unknown, costly and inequitable – it is going to cost significantly more and most claimants will receive significantly less (and it will be harder to claim).”

She added that the increase in fuel levies will impact most severely on those who can least afford it

“I think there’s a limit to what can reasonably be expected from consumers and we have already seen how there have been recent strident calls for a reduction in the fuel price,” she said.

Read: What a litre of petrol would cost in South Africa without government’s steep taxes

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New bill could cause fuel levies to rise by another 75%: legal expert