Pretoria - The Road Accident Fund (RAF) yesterday asked the Gauteng Hight Court, Pretoria, to gag the office of the Auditor-General from making public its annual audit report.
It asked Judge Colleen Collis for an urgent order that the AG may not publish or make the report public regarding its audited financial position known at this stage, including tabling it in Parliament.
The RAF wanted this order pending the outcome of an application, to be heard at a later stage, for the review and setting aside of the findings of the AG.
Alternatively, the RAF wants the findings of the report suspended for six months, so that the AG can “meaningfully engage” with it regarding its finances.
While the findings of the AG are not yet public, it emerged during the court proceedings that the audit concluded that the RAF’s liabilities exceeded R361 billion. But the RAF is disputing this, claiming that its liabilities are no more than R30 billion.
It also emerged that the RAF wanted to secure loans from outside entities to try to get itself out of its dire financial position.
But, in order to do this, the RAF has to disclose its financial position as contained in the report, while vehemently denying the audit findings.
Advocate Paul Pretorius, acting on behalf of the AG, said the entity had various obligations in law, which included making its audit findings available to Parliament. This must be done within a month of Parliament resuming its sitting this year.
Pretorius questioned how the RAF’s audited financial statements could be kept under wraps, and the body be allowed to go out and secure loans while it was clearly in a dire financial position.
There was a duty on the AG, as the top auditor in the country, to make these facts known to Parliament, the Ministry of Transport as well as other entities, he said.
If the RAF was allowed to go out and secure loans, without its true financial status being known, Pretorius said, it would put enormous pressure on the fiscus.
Apart from this, he argued, by allowing the RAF to go out to secure billions in loans as things stood, the public, as taxpayers, would in the end feel the brunt.
Parliament should see the report and debate on the disputes, as this was in the public interest, he said.
The RAF, on the other hand, argued that it was disputing the AG’s findings, and the court – in the later review application – must look at all the facts and decide on the matter before the report was made public.
Judge Collis was told that, among others, several financial experts would be called to give their opinion on the manner in which the AG came to her financial calculations, and the office’s accounting principles.
While the AG said this matter should have never come before court, advocate Cedric Puckrin, SC, said the RAF tried its best to resolve the matter outside court. He said the AG had steadfastly refused to postpone the handing of its report to Parliament.
“We are just asking for a moratorium on making the report public,” Puckrin said.
Thembelihle Msibi, the chairperson of the RAF’s board, said in court papers the entity had changed its accounting policy, which had resulted in a disclaimer of opinion of its financial records.
This had caused concerns for the AG in assessing the RAF’s financial position.
Msibi said, as they were disputing the AG’s assessment of the RAF’s financial position, it would cause the entity irreparable harm if the financial report was made public before its contents were scrutinised during the upcoming review application.
She said while the RAF was financed by the fuel levy to meet its financial demands, it still had to supplement its income by securing loans from outside.
Msibi said the finding by the AG that there was not sufficient evidence for claims of liabilities as disclosed in the financial statements, made it practically impossible for the RAF to raise loans.
She said the release of the report, in its current state, would jeopardise all the efforts the RAF had made over the past few years to try to recover from its dire financial position.
The judge said she would issue her order some time next week.
Meanwhile, the Special Investigations Unit is also conducting an investigation into the affairs of the RAF.
Pretoria News