Ministry's study on highway concessions may see lower rates

Thursday May 8, 2008 The STAR
Ministry's study on highway concessions may see lower rates

KUALA LUMPUR: The Works Ministry will review highway concessions which may result in lower toll rates. Minister Datuk Mohd Zin Mohamed said he would call for a detailed study to be carried out before reviewing the concession agreements. Some of the important factors to be considered were the traffic volume forecasts, toll rates and period of the concession, he said.

“We will compare the toll collections, and maintenance and operational costs, as well as ‘heavy’ maintenance costs,” he told reporters at the Parliament lobby yesterday. Heavy maintenance, he said, referred to scheduled maintenance to resurface the entire highway while normal maintenance involved patching up potholes.

Mohd Zin said there was a toll review mechanism clause in the concession agreements which prevented concessionaires from raising toll rates as they pleased. “If the traffic volume hits a certain level, then the toll increase can be averted,” he said. He said the study would be completed within three months. Asked if the findings of the feasibility study could lead to lower toll rates, he replied: “It is one of the possibilities.”

On whether the Government had paid compensation to any concessionaire as toll rates had not been raised this year, Mohd Zin said no payment had been made as it was reviewing the concessions. He said there were 22 highway concessionaires in the country but seven were not making profits, including the operators of the New Pantai Expressway, Shah Alam Expressway and the Second Link.

Earlier in Parliament, Mohd Zin told Tony Pua (DAP – Petaling Jaya Utara) that the total accumulated income from toll charges of the 22 tolled highways was RM27.6bil, while the accumulated profit was RM3.5bil as of December last year.

To another question by Pua, Mohd Zin said the ministry was discussing with PLUS to redesignate the North-South Expressway into urban and inter-urban areas, to study cost-effectiveness and traffic volume. He said the urban zone would be Rawang to Nilai while inter-urban would be areas in Ipoh, Seremban and Johor Baru.

“Alternative federal roads linking cities will also be given priority to be upgraded and these roads are free of toll charges,” he said.