South Africa Transport Minister rejects fuel levy increase

South African Transport Minister Barbara Creecy has ruled out seeking an increase in the fuel levy, stating that motorists are already facing significant financial pressure. This decision follows recent petrol price surges that have increased costs for households and businesses.

The Road Accident Fund (RAF) has faced severe financial instability, with liabilities exceeding R440 billion. Due to stagnating revenue and the rise of fuel-efficient electric and hybrid vehicles, the RAF has proposed alternative funding models to the National Treasury. These include implementing a levy on vehicle registration and license disc fees, as well as charging foreign-registered vehicles entering the country.

Minister Creecy emphasized that the priority should be addressing the RAF’s management and financial issues rather than increasing the burden on consumers. She noted that the RAF board was replaced with an interim board last year and a new chief executive has been appointed. The government is also looking into legislative changes, such as a no-fault compensation system and a defined schedule of benefits, to improve the fund's efficiency.