by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Petaling Jaya on Thursday, 2.1.1992:
DAP calls on Cabinet to freeze the 20 per cent increase in the highway toll rates for Class 3 vehicles (lorries and trailers) as it is against a 1987 government promise that there would be no increase of highway toll rates or the first five years from 1989-1994
DAP calls on Cabinet to freeze the 20 per cent increase in the highway toll rates for Class 3 vehicles (lorries and trailers) as it is against a 1987 government promise that there would be no increase of highway toll rates or the first five years from 1989-1994 after the award of the North-South Highway privatisation contract to United Engineers Malaysia (UEM).
From yesterday, Projek Leburhraya Utara-Selatan Bhd. (PLUS) had been imposing a new rate of 15 sen per kilometre for the North-South Highway, New Klang Valley expressway, Tanjung Malim-Slim River road and the Bukit Hitam-Jitra Highway- which is 2.5 sen more than the previous 12.5 sen per kilometre and a hefty increase of 20 per cent.
In 1987, at the height of the DAP’s opposition to the award of the privatisation of the North-South Highway to the United Engineers Malaysia (UEM), the then Works Minister, Datuk Samy Vellu, had tried to assure public protest by promising that UEM would not be allowed to increase its toll rates for the first five years of the operation of the concession from 1989-1994, and that increases in toll for
subsequent years would be indexed to inflation.
This promise had now been violated with the 20 per cent increase in the North-South Highway toll rates for Class 3 vehicles by 20 per cent.
The Cabinet should immediately freeze the 20 per cent increase in the toll rates for lorries and trailers, and explain:
Firstly, why the Government had dishonoured its 1987 promise made by the then Works Minister that UEM would not be allowed to increase toll rates for the first five years of its concession;
Secondly, the justification for the 20 per cent increase of toll rates for lorries and trailers-as to whether this had been indexed to inflation for 1991?
Thirdly, what is the mechanism for the government permitting UEM and PLUS to increase the toll rate, and why the public and affected road users, especially operators of lorries and trailers, had not been given an opportunity to be heard before the government approves the new toll rates?
Barisan Nasional Government must demonstrate that in approving the 20 per cent toll increase, it was acting in the public interest and not in the interest of Renong, UEM and PLUS companies because of their UMNO Baru political connections
The Barisan Nasional Government must not only be fair, but must seen to be fair, in approving new toll rates for the North-South Highway, especially if it will enormously benefit the Renong, UEM and PLUS stable of companies with their UMNO Baru political backgrounds.
UEM had recently reported a 46 per cent increase in group pre-tax profit to $118.83 million for the nine months ended September 30, 1991 compared with $81.15 million in the previous corresponding period.
At company level, UEM reported a pre-tax profit of $23.03 million compared with $8.85 million the year before.
Increase in the highway toll rates will further inflate UEM profits, which owns PLUS together with Faber Group Bhd- and are all in the Renong conglomerate-and will greatly benefit these corporations which are intimately linked and identified with UMNO Bari and its leaders.
However, it is clearly not in the public interest to use the Malaysian public as a captive market to increase the profit margins of the Renong, UEM and PLUS stable of companies with their UMNO Baru connections.
It must be borne in mind that the Government had given $1.6 million loans as well as guarantees against any shortfall in toll collection to UEM for the North-South Highway privatisation project.
Toll revenue from those parts of the highway that are open has risen 22 per cent a year over the past three years, against an original estimate of 5 per cent a year. And traffic growth has risen 20 per cent a year compared with an earlier estimate of 6 per cent.
It was reported that three years ago, UEM privately told its bankers that it expected group profits of more than $14 billion on turnover of $30 billion from the North-South Highway, which it will own till the end of the 30-year concession period in 2018.
There is therefore no justification for the increase in the highway toll for Class Three vehicles as UEM and PLUS have profited immensely from higher-than-expected levels of toll revenue and traffic volume, even though it has been reported that with the total cost overruns, the 900-km North-South Highway would cost $6 billion to build.
Let it not be said therefore that the North-South Highway toll rates had been increased to enrich the UMNO Baru cooffers. This is why the cabinet must freeze the 20 per cent toll increase for lorries and trailers, and conduct a public hearing for PLUS to justify its application for the 20 per cent increase so as to demonstrate that the government’s approval is based on public interest and not in the interest of Renong, UEM and PLUS for their UMNO Baru connections.