Works Minister Samy Vellu explained today that the proposal to increase the toll for the Penang Bridge is to avoid the federal government having to pay higher compensation to the road bridge concession holder.

The toll, he said, was supposed to be increased in 1998 but it was not, resulting in higher compensation for the federal government.

According to a Bernama report, Samy Vellu said that as far as the concession holder was concerned, any loss resulting from the failure to increase the toll would be compensated by the federal government.

He said that each year, the federal government has to pay compensation to (road, bridge and highway) concession holders, amounting as much as RM300 million.

"However this year we have managed to reduce the amount after reviewing the tolls," he told reporters in Sungai Siput, Perak.

Yesterday, Penang Chief Minister Dr Koh Tsu Koon said there was no need to increase the Penang Bridge toll if the current operations provided good returns to the Penang Bridge Sdn Bhd (PBSB), the concession holder.

Under discussion

He said this could be decided by comparing the toll collection with the estimate by PBSB.

Samy Vellu said the proposal to increase the toll for the bridge, which began operations in 1985, was still under discussion and that he would announce soon whether it would be implemented or not.

"During the past five years, we have provided the facilities to the people of Penang with no toll increase on the request of the state government and the chief minister," he said.

An estimated 50,000 vehicles pass through the 13.5km bridge daily, paying tolls between RM1.40 to RM75.

Last May, PBSB Executive Director Aminuddin Yusof Lana was reported to have said that the company was in discussion with the federal government to review the toll rates of the world's third longest bridge.

According to him, the company was allowed to increase the toll rates by 10 per cent once every five years under the concession agreement.