Highway fees take a toll on Malaysian motorists

This story was first published in The Straits Times on Dec 24, 2013

A DOZEN expressways surround Malaysia's capital Kuala Lumpur and the southern districts of Selangor state which collectively are known as Klang Valley or Greater KL.

These roads have acronyms and abbreviations that range from prosaic to grand, such as Plus, Sprint, Duke, Silk, NKVE (North Klang Valley Expressway) and MRR2 (Middle Ring Road 2).

Over the next few years, Greater KL with its population of six million will get four more highways including Dash, Klorr and Suke.

Most of these six-lane roads have toll stations that for motorists feel like money-suckers. Right now, these highways are raising their temperatures as well, after a Cabinet minister said toll-fee hikes are inevitable.

The Edge business weekly said last week that the toll hikes were expected to be between 50 sen (19 Singapore cents) and RM2.

The issue has led to widespread concern over runaway inflation next year.

"We understand that the government is tied to concession agreements with the highway companies, but priority must be given to the people," said Mr Yusof Abdul Rahman, communications director of the Federation of Malaysian Consumer Associations.

Already, the government has said it will introduce a 6 per cent goods and services tax in April 2015, and will raise electricity tariffs next year. There is also a strong possibility of another fuel price hike, the last being in September this year.

There have also been suggestions by Tan Sri Syed Hamid Albar, who heads the Land Public Transport Commission, that taxi and school bus fares would be raised next year.

The toll-fee hike unhappiness spilled onto Page 1 of Utusan Malaysia last Thursday, with a banner headline Relook Toll-fee Hike. The newspaper, owned by Umno, a key partner of the ruling coalition Barisan Nasional (BN), quoted consumer groups' worries about surges in the cost of goods as most goods and services are delivered by road.

On the same day, The Star - owned by the Malaysian Chinese Association, also part of BN - had as its Page 1 headline Keep The Promise. The article quoted a senior politician who reminded the government of its May election promise to carry out "gradual reduction of intra-city tolls".

In 2011, worried about a voter swing as it prepared for the elections, the government had stopped a toll-fee hike provided for in concession agreements, paying several toll companies RM400 million as compensation.

Many people want the government to do the same today, with the opposition having a field day saying the series of looming price increases is BN's way of thanking voters after the May elections.

Opposition leader Lim Guan Eng lays out the public's case thus: "We have 27 private tolled expressways nationwide with a total length of about 1,500km, operated by 20 companies. At least one-third of these tolled roads are concentrated in the Klang Valley.

"With public transport usage in the urban areas at only 20 per cent, how is that possible for ordinary Malaysians to avoid travelling by cars and paying tolls, no matter how unwillingly?"

Tolled highways became a popular way of making money following the success of the 30-year-old North-South Expressway, Malaysia's longest highway that runs for 775km from Johor in the south to the Thai border in Kedah state.

The government went on a big privatisation drive in the 1990s that is still being carried out today, with infrastructure from power plants and ports to telecoms and highways being built by private enterprises and government-linked companies.

The idea was that the private sector could build and run these infrastructure more efficiently.

The disadvantage for the public in highway projects is that it has to pay ever-rising tolls under the concession deals.

Mr Iqbal Zainal, research analyst at Kenanga Investment Bank, said it is all right for the highway operators to not raise toll charges as their concession agreements have clauses that say they would be compensated by the government - using public money - instead.

Joining the toll debate for the first time over the weekend, Prime Minister Najib Razak said the government is studying the matter to ensure the new fees will not be a burden on the public, and that the toll companies do not make "excessive" profits.

It is also looking at introducing discounted season passes for regular highway users, he said.

The ABC of Malaysia's highways

IF SINGAPORE has its BKE, ECP and CTE, Greater KL drivers have a dozen highways to navigate through, all featuring toll stops that cost at least 50 sen (19 Singapore cents) each.

Malaysia's longest highway is the 775km Projek Lebuhraya Usahasama (Plus) or the North-South Expressway, that runs from Johor to the Thai border.

Most highways are built around Greater KL, including those with Malay acronyms such as Silk (Kajang Dispersal System Expressway), Sprint (KL-West Traffic Dispersal System) and Duke, the Duta-Ulu Kelang Expressway.

For a new, fast route from KL to the administrative capital of Putrajaya 32km away, take the MEX or Maju Expressway.

Four new highways are coming up in a few years' time, including Dash (Damansara-Shah Alam Highway), Klorr (KL Outer Ring Road) and Suke (Sungai Besi-Ulu Kelang Elevated Expressway).

This story was first published in The Straits Times on Dec 24, 2013

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