Adding to the long list of endless hikes recently, motorists will wake up to the first day of 2014 with another burden in the form of toll hikes.

The government just announced that toll for 15 highways in the peninsula will be increased from 50 cents to RM2 with effect from Jan 1, 2014. The government is of the view that the toll concession contracts signed with the concessionaires allow the latter to review and increase toll charges every three years.

If the government does not allow the concessionaires to revise the toll rates, it has to pay them compensation as what they did, paying some RM1 billion last year for not allowing these 15 concessionaires to raise the toll in 2008 and 2011. It is said that the government will have to pay another RM400 million to these 15 concessionaires if they are not allowed to increase the toll again next year.

As it is, the concessionaires are already reaping huge profits on a yearly basis. This comes about due to various reasons, the most notable of which is the tremendous increase of traffic flow which far exceeds what was first anticipated when the toll concession contracts were first signed.

Never in the history of this country has any toll concessionaire suffered any losses except in the rare case involving Seremban – Port Dickson Concessionaire. Even in this case, the government was forced to take over the concessionaire through PLUS eventually.

Re-negotiate terms

If the government is really sincere in its efforts to help the poor rakyat, there are at least two ways of dealing with this matter as follow:

a) Re-negotiate with the toll concessionaires to vary the terms of the contracts. The Penang bridge is a good example where the government had successfully done this and since then, there has been no toll hike for many years till now.

As a matter of fact, since the government through its government-linked companies (GLC) is also a major shareholder in many of the highway concession companies, the task of re-negotiation is made that much easier.

b) Should the toll concessionaires refuse to re-negotiate, the government can still possibly rescind the contracts on ground that the contracts are “contracts against public policy”. Although courts generally do not interfere with freedom of contract and use the public policy doctrine sparingly, the doctrine of public policy can be invoked in clear cases in which the harm to the public is substantially incontestable.

The government could easily argue that its citizens’ interests are harmed or prejudiced when they have to pay increased toll charges every three years even though highway toll companies net profits continue to go up every year without fail. The annual accounts of these highway toll companies are evidence per se which can be used against them in the judicial review.

In the past, the government had extended the collection period of some toll concessionaires in place of compensation and had also taken over a loss making highway concession company. The government for reasons best know to themselves have been “helping” the highway toll companies all these while. It is about time the government walks its talk helping its rakyat in their daily walk-through life with much less burden.