Friday, November 03, 2017

Najib’s toll ‘freebie’ election goodie to cost Malaysians billions of ringgit

In an interview with TV3 Nightline, Second Finance Minister Datuk Johari Abdul Ghani said that PLUS would have to be compensated to the tune of RM102 million per year for abolishing the Batu Tiga and Sungai Rasau tolls and RM8 million for the Bukit Kayu Hitam toll. That’s a total of RM110 million per year just to PLUS. The compensation for the Eastern Dispersal Link (EDL) was said to be RM8 million, going to current concessionaire MRCB.

The above will cost the government RM118 million per year just to abolish these four tolls.

The concessions for all four tolls expire in 2038. Assuming if the compensation doesn’t increase over time, it will still cost a whopping RM2.36 billion.  However, this compensation amount will be even higher when the compensation is calculated based on forecast toll usage in the future.

Whether the compensation is given out in cash or through extensions of the concessions, the person footing the bill will still be the rakyat. That’s RM2.36 billion that could be used to benefit all Malaysians and not just help BN win over voters in the 3 states of Selangor, Kedah and Johor.

Let’s not forget that the government has already compensated toll concessionaires before when they have announced halting toll rate hikes in past Budget speeches. Each one of these populist moves only ends up costing the government and Malaysians more and more. The Prime Minister’s toll ‘freebie’ is no freebie at all.

If the Government is serious about making tolls more affordable for Malaysians, they’d take Pakatan Harapan’s advice. The Pakatan Harapan manifesto has called for the abolition of highway toll in stages via the restructuring and renegotiation of the toll agreements with the concessionaires.

Nearly all of these agreements contain clauses which allows the Government to expropriate these highways based on agreed formulas.  And in many circumstances, compensating toll concessionaires based on loss revenue as what the BN government is doing, costs a whole load more than just expropriating the highways outright.

For example, between 1990 to 2015, the compensation for Lebuhraya Damansara Puchong (LDP) already amounts to RM1.05 billion even though the actual cost of constructing the highway, including interest amounts to only RM1.3 billion.  And there’s 13 more years to the concession period for compensation to be paid and for the concessionaire to make outrageous profits.

We call upon the Najib administration to stop fleecing Malaysians with not-at-all-free “free” tolls and concessionaires who continue to make astronomical profits at the expense of the rakyat.

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