Petaling Jaya Utara MP Tony Pua has queried how the government derives the figure of RM400 billion to acquire all 26 private highway tolled projects, when the costs of construction was less than RM29 billion.

Pua ( right ) in a statement today said Works Minister Fadillah Yusof had told the Parliament in his reply to a question from Sepang MP Mohd Hanipa Maidin that buying back all the highway concessions in the country was not possible because it will cost RM400 billion.

“The minister must be completely out of his mind to claim it will cost RM400 billion to acquire all these tolled highway,” he exclaimed.

The lawmaker said there are 26 tolled highways in operation in peninsular Malaysia and by tabulating the cost of the construction for each of these highways, the total amounts to only RM28.5 billion, with the bulk being the North-South Expressway (Plus) costing RM5.95 billion.

“How can the BN government arrive at an incredulous figure of RM400 billion or 14 times more the RM28.5 billion cost of construction?” he asked, querying further whether the government was attempting to compensate these concessionaires for the loss of future profits, despite the agreements explicitly stating that the government does not have to make such compensations?

He said if the government has to compensate the concessionaires for future profits, then it defeats the  idea of highway buybacks in the first place.  

Pua said if the RM400 billion figure is indeed the compensation for the loss of future profits, it means that ordinary Malaysians will actually be paying toll over the next two decades to let these fat concessionaires earn more than RM370 billion in profits!

‘What sort of gov’t do we have?’

He asked what type of government do we have that signed contracts that allow these private crony companies the opportunity to make astronomical profits at the peoples’ expense.

 

“It is hence unsurprising that the government has no intention to buy back these toll concessions because they allow their crony companies to earn hundreds of billions of ringgit.

 

“This is despite the fact that all the concession agreements, barring Plus and the Penang Bridge, have mutually agreed clauses which allows the federal government to buy back the concessions based on the cost of construction with a guarantee that the concessionaires would receive a 12 percent return on each of the prior years of operation.”

 

This means that assuming all of the highways did not make a single sen over the past years of operations, then the buy-back cost will hit an estimated maximum of RM50 billion, an eighth of the federal government’s ridiculous estimate of RM400 billion, said Pua.

 

However, he claimed most of these expressway made fantastic profits in excess of 12 percent over the past past years and hence, this means there is no need for the government to compensate for “insufficient” profit in the previous operating years.

 

What’s more, Pua said, there is no need for the government to acquire all these highways, and certainly not all in one go.  

“The government just needs to focus on highways which are clearly making unreasonable profits, such as the LDP with a net profit margin in excess of 40 percent, to ease the burden of the rakyat.

 

“It is clear from the minister’s reply that the BN government does not prioritise the interest of ordinary Malaysians who are suffering from the highest inflation rate in more than a decade. Instead, it will do its utmost to protect the ludicrous profits enjoyed by the BN crony companies for purposes best known to themselves,” said Pua.