Issued by: Ministry of Transport
The benefits payable by the MMF to victims of road accidents are financed by levies on fuel, part of the general fuel tax. These levies were last reviewed in April 1993. Since then the MMF's levy income has grown by nearly 6% p.a. as a result of the increase in the volume of fuel sold, but this has been inadequate to keep pace with the growth of more than 20% p.a. in the MMF's claims expenditure.
In view of the serious pre-existing technical insolvency of the MMF, and in order to reduce the impact of the operating losses which the MMF is incurring, Cabinet, late last year decided in principle to increase the MMF levies, implimentation of that decision was delayed, however, to co-incide with other revisions in the price structure of fuel which are now being implemented as from 7 August 1996.
From that date, the MMF levy on petrol is to increase by 1,5 c/l from 9,0 c/l to 10,5 c/l, whilst the levy on diesel is to increase by 1,0 c/l from 5,8 c/l to 6,8 c/l. This approved increase is half the increase supported by Cabinet last year.
The draft White Paper on the MMF which was published in May contemplates certain measures to address the financial problems of the MMF, but in the meantime the above adjustments to the MMF levies are necessary.
ISSUED BY THE MINISTRY OF TRANSPORT, PRETORIA 2 AUGUST 1996
Enquiries: Mr WB Swanepoel (012) 323-9203