No decision yet on PLUS concession extension

PLUS’ concession agreement is one of the matters that are being thoroughly looked over as it includes sensitive matters, says deputy minister

 pic by TMR FILE

THE extension of PLUS Malaysia Bhd’s toll concession from 2038 until 2058 is yet to be finalised as it involves scrutinising some “sensitive” matters.

Deputy Works Minister Datuk Eddin Syazlee Shith said several aspects are being considered for the extension including PLUS’ revenue projection as stated in the current concession agreement between the highway operator and the government.

“PLUS’ concession agreement is one of the matters that are being thoroughly looked over by the Cabinet as it includes sensitive matters including an increase in toll fares and the concession period, taking into account the financial impact on consumers and the government.

“So far, there is no agreement reached for the extension as it is still being discussed,” he told the Dewan Rakyat yesterday.

Eddin Syazlee was replying to a query by Datuk Seri Mahdzir Khalid (Barisan Nasional-Padang Terap) on whether the Perikatan Nasional government will review the decision to extend PLUS’ concession as announced by the Pakatan Harapan administration in January.

Earlier this year, the then Prime Minister’s Office (PMO) announced the extension of PLUS’ concession for 20 years until 2058, while freezing the hikes on toll charges.

The extension has entailed PLUS to remain as the highway operator and continue to hold the liabilities and assets of the company as well as fund the operating and maintenance costs.

The government also implemented an 18% discount in toll charges for private vehicles at PLUS-owned highways beginning Feb 1, 2020, after the announcement of the extension.

The new rate has been applied at the North-South Expressway, New Klang Valley Expressway, Seremban-Port Dickson Highway, North-South Expressway Central Link, Malaysia-Singapore Second Link, Butterworth-Kulim Expressway, Penang Bridge and East Coast Expressway.

The PMO said the extension was to ensure that PLUS could maintain and operate its highways independent of the government, while Khazanah Nasional Bhd and the Employees Provident Fund remained as the highway operator’s shareholders.

With the extension, the government was expected to collect RM42 billion in savings throughout the concession period.

The PMO noted that the decision was reached through studies which spanned over a year and with thorough considerations by multiple parties including the Works Ministry, Finance Ministry (MoF) and Prime Minister’s Department (Economic Affairs), previously the Economic Affairs Ministry.

Meanwhile, Eddin Syazlee said the Cabinet memorandum on the direction of tolled highways will be presented to the Cabinet for review and approval by mid-December.

The memorandum includes the renegotiating processes with concessionaire companies to take over the four highways in the Klang Valley.

“At present time, the government is still reviewing the options in the highway managements to reduce the government and consumers’ financial burden, including the implications on local and foreign investors,” he said.

In June 2019, MoF announced that the government’s plan to take over the highways in the Klang Valley from four concessionaires for RM6.2 billion.

The concessionaires were Lingkaran Trans Kota Holdings Bhd, Sistem Penyuraian Trafik KL Barat Holdings Sdn Bhd, Kesas Sdn Bhd and Projek Smart Holdings Sdn Bhd.

The four highways involved were the Damansara-Puchong Expressway, Sprint Expressway, Shah Alam Expressway and the Stormwater Management and Road Tunnel.

Read our earlier report here

Proposal on highway concessionaire takeover to be tabled mid-Dec