PLUS to get RM2.2 billion compensation for toll removal
Government to make annual payments over a 20-year-period to PLUS Malaysia Bhd for removing toll collections at three places from next January, says second finance minister.
(FMT) – The government will pay PLUS Malaysia Bhd RM2.2 billion in compensation for removing toll collections at the federal highway and Bukit Kayu Hitam, according to Finance Minister II Johari Abdul Ghani.
He told The Malaysian Reserve (TMR) the total payment to the highway operator would be spread out in 20 equal payments over 20 years.
The compensation will be broken down to an annual payment of RM102 million for removing two toll collections – at Batu Tiga and Sungai Rasau – along the federal highway in the Klang Valley and another RM8 million for removing the toll booths at Bukit Kayu Hitam, Kedah, on the north-south expressway.
Johari said the compensation amount was in the agreement, but that the government was negotiating a lower amount.
“We are negotiating with PLUS for discounts because the RM102 million is based on estimated revenue loss for removing the tolls,” TMR quoted him as saying.
Finance Minister Najib Razak, in tabling the 2018 budget last month, had announced the removal of toll collections at these locations from Jan 1 next year.
Johari defended the compensation to PLUS, saying it was being done for the benefit of the people.
Dismissing claims the compensation was a form of bailout for PLUS, Johari said the government was obligated to absorb the losses incurred by PLUS, as it was the government’s decision to cease toll collections ahead of the concession period.
PLUS holds a concession until 2038 for the federal highway and the north-south expressway.
“It is definitely not a bailout. Why [would] the government want to bail out a company which has a concession agreement to collect tolls?”TMR quoted him as asking.
Earlier reports had quoted Johari as saying the federal government was looking into extending the concession of PLUS as compensation for abolishing these tolls.
He had also been reported as saying that 140,000 motorists would benefit from the abolition of the Batu Tiga and Sg Rasau tolls.
PLUS, which operates 94 tolls nationwide, is owned by UEM Group Bhd, which is owned by Khazanah Nasional Bhd.
