No toll hikes this year, Putrajaya to compensate RM400 million to concessionaires
(TMI) – Putrajaya today climbed down from its earlier plans to raise toll rates after facing growing revolt on the ground against price hikes and subsidy cuts that has made Cabinet ministers the butt of jokes in Malaysia.
Deputy Prime Minister Tan Sri Muhyiddin Yassin (pic) said the ruling Barisan Nasional (BN) government decided not to raise toll rates this year as part of its plan to tackle the rising cost of living.
He said the move will cost the Government RM400 million which has to be paid as compensation to the various toll concessionaires, which Putrajaya said it could not afford under a plan to cut the federal deficit. Putrajaya had earlier raised electricity rates by 15% and pump prices rose 20 sen per litre, saying it had to cut the energy subsidy bill that costs some RM24 billion a year.
Muhyiddin chaired special cabinet committee to tackle the rising cost of living today where the decision to keep current toll rates was made, The Star Online reported.
Muhyiddin also announced an allocation of RM120 million to Fama, Nekmat and Nafas to ensure sufficient food supply in the market.
Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar had last year said that it was impossible to stop toll rate hikes this year due to the concession agreement between the government and highway concession companies.
He said Putrajaya had to fork out RM400 million in compensation to toll concessionaires after it froze a revision of the toll rates that were meant to be implemented in 2011 under the concession agreement.
PKR strategic director Rafizi Ramli said Putrajaya could put off plans to raise toll rates as it owned or held major stakes in toll concessionaires which gave it decision-making powers.
In refuting Putrajaya’s claim that the hike was “unavoidable”, Rafizi said that the move is totally unjustified as toll operators were making an “obscene” amount of profit with minimal cost.
“What has been hidden from the public’s view so far is the fact that most largest toll concessionaires are owned by government-linked companies,” the PKR strategic director told reporters here.
He had described the financial transactions between Putrajaya and the toll concessionaires as “going from the left pocket to the right pocket”.
“The other misleading statement made by government – it is as if the whole highway system is completely privately funded. It is not, because it involved a lot of government guarantees,” he added.
Rafizi noted that the North-South Expressway Project – which handles, among others, the North-South Expressway, the North Klang Valley Expressway and Central Link Expressway – is wholly-owned by government funds such as Khazanah Nasional Bhd and the Employees’ Provident Fund (EPF).
