Govt studies Plus takeover, but no toll abolishment

by AFIQ AZIZ/ pic by RAZAK GHAZALI

THE taking over of Plus Malaysia Bhd would not guarantee free tolls for the public, Prime Minister Tun Dr Mahathir Mohamad (picture) said.

He said although toll abolishment was mentioned in the Pakatan Harapan manifesto during the 14th General Election, the public must understand the financial constraint that his administration is facing.

Dr Mahathir said the only way for that to happen is through the government’s acquisition of highway concessionaires, which would involve multibillion of ringgit.

“The other thing is that if we manage to buy, we have to spend money to maintain the toll. So, the public must understand the problem that we face,” he said.

Dr Mahathir asked how the highways will be maintained if toll collection is abolished.

“All highways need to be maintained, enlarged, add new lanes…all of which cost money,” he added.

Dr Mahathir was responding to a report that there was a proposal for Khazanah Nasional Bhd to issue perpetual bonds for the federal government to acquire an unspecified number of highway operators — among the three proposals currently on the table for federal consideration.

According to the report, a second proposal by the Works Ministry was for the government to lease highways from owners in order to decide on the toll rates.

The third is a proposal by the Finance Ministry, involving the acquisition of four Gamuda Bhd-linked highways which would be financed through toll collection.

Toll collection would then be restructured to allow off-peak discounts and no charge after midnight.

All three proposals can only offer lower toll charges — a move considered as a compromise to meet the government’s objectives.

Dr Mahathir added that the government is still finalising the fresh proposal made by Maju Holdings Sdn Bhd in taking over the concession of Plus Malaysia, as reported last June.

“Surely they will still need to collect toll. If there are no toll charges, they won’t buy. Their proposal includes reducing toll charges.

“They want to do all sorts of things, such as fixing the roads. So, we are still considering,” he said.

In September 2017, Maju Holdings group executive chairman Tan Sri Abu Sahid Mohamed had made an indicative offer at a total enterprise value in excess of RM36 billion.

The offer also involved freezing toll rates for the next 20 years until the end of the concession period, while reducing government contingent liabilities by RM30 billion.

Maju Holdings was willing to forfeit the government’s compensation of about RM900 million owed to the toll road operator and undertake infrastructure improvements, including lighting up the entire highway.

Plus Malaysia owns five concessions including Projek Lebuhraya UtaraSelatan Bhd, which has under its umbrella the 772km North-South Expressway; the New Klang Valley Expressway; Federal Highway Route 2 and Seremban-Port Dickson Highway.

It also holds the concession of Expressway Lingkaran Tengah Sdn Bhd, which has the North-South Expressway Central Link; Linkedua (M) Bhd, which owns the Malaysia-Singapore Second Crossing; Konsortium Lebuhraya ButterworthKulim Sdn Bhd, which operates the Butterworth-Kulim Expressway; and Penang Bridge Sdn Bhd.

All Plus Malaysia concessions end in December 2038.