Saturday, December 16, 2006

TOLL HIKE PROTEST 10am SUNDAY (17-Dec 06) BANDAR MAHKOTA Cheras; DAP: Don’t BLAME SAMY; “UMNO “Mother of ALL Evils” in Malaysia.

MORE Toll PROTESTS COMING - Dec 31st & Jan 07 2006

UPDATE 19 th Dec 2006, 15:37 pm;

ABOVE: Ronnie Liu addressing the protesters present and BELOW: The silent protesters with the mini placard reading- "Fight for your Rights" under the watchful eyes of the FRU (Federal Riot Unit) personnel

MORE PICTURES TOLL HIKE Protest: SAMY is So KIND: NO Toll for LIFE So Toll increased By NOT Extending the Concession Period – Another Samy Spin From Venezula.

The new spin from Samy is NO TOLL FOR LIFE and he seems to be doing every motorist a BIG favor by approving the new rates. We cannot escape this spin of NO TOLL FOR LIFE, as one end and there will be another one to continue & follow.
There is another one coming - the DUKE (Duta Ulu Kelang Expressway) Highway (part elevated, now under construction) from Jalan Duta to Ampang – for another 35 years concessions
for HARIS ONN HUSSEIN – see previous post H E R E
The BIG Question here is: AFTER all the BAD deals in the current Toll agreements, WHAT is signed and agreed in this new DUKE Highway? The same skewed safety old clauses, so the NEXT generation will be tolled and and have to toil along these highways!
The government & the concessionaires are one and the same Gang working in cahoots (
questionable collaboration & in secret partnership) to rob the rakyat!
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WAS THERE AN AUDIT Before the Hike?

Below is a 2003 report by Bernama that an AUDIT is necessary

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from MALAYSIAKINI headline

ABOVE & BELOW: Another speaker voicing his anger at this enormous toll hike especially for LDP

Concession Period Will Not Be Extended, Says Samy Vellu; From Jamaluddin Muhammad; December 18, 2006 14:31 PM

ABOVE: SAMY ( & his Boss) in Caracas, Venezula after a fat dinner reception oblivious to the fuming anger of motorists back home, is doing us a favor - NO TOLL FOR LIFE - Believe it or NOT! by increasing the Toll Rates

CARACAS, Dec 18 (Bernama) -- The government could not spread the burden of imposing higher toll rates over a much longer toll concession period as it did not want toll collection to be a permanent feature in Malaysia, said Works Minister Datuk Seri S. Samy Vellu. He said the government had to put a limit on the extension of the toll concession period at between 30 and 35 years in order to avoid motorists from paying toll for life. If we allow the concession period to be extended to 60 years just to enable motorists to pay much lower toll rates now, it would result in motorists paying toll for life," he told reporters, here. Samy is here as part of a delegation of Prime Minister Datuk Seri Abdullah Ahmad Badawi's three-day official visit to Venezuela beginning Sunday. He was asked to comment on the possibility of imposing lesser toll charges with the extension of a much longer concession period following the recent announcement of toll hike of between 30 sen and RM1 for five highways starting Jan 1 next year.

The highways are the Lebuhraya Damansara-Puchong (LDP),
Shah Alam Highway, Cheras-Kajang Highway, KL-Karak Highway and the Guthrie Corridor Expressway. Samy said the government had to pay the toll concessionaires compensation in the form of cash and concession extensions as an option not to allow them to charge motorists higher toll rates according to the concession agreements. However, extending the concession period without any limit would not serve the interest of motorists as they would be paying toll for the rest of their life, he said.
He said motorists were no longer paying toll for the Jalan Kuching, Jalan Pahang, Jalan Cheras and Johor Baharu-Senai highway when their concession period ended.(…… This is NOT Correct SAMY, still spin by Bernama, see below ) He also said the government could not interfere with the concessionaire agreements with banks over the repayment period of 15 years for the loans to build the highways. "We simply cannot ask banks to extend the repayment period in order to avoid an increase in toll charges as it involves syndicated loans and it will affect the country's banking industry if loans are not paid within the stipulated time in the agreement," he said

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Samy’s ‘cheapest’ toll rates claim misleading ; Richard Teo; Dec 18, 06 4:08pm (from Malaysiakini letter)

Works Minister S Samy Vellu defends the coming steep rise in toll rates on grounds that Malaysia has the 'cheapest tolls in the world'. What the minister fails to add is that other countries’ citizens don’t pay road tax and their import duties and excise duties don’t reach to 100% to 200% levels depending on the models.

An average popular car like Toyota Vios cost US$10,000 (RM36,000) in America. In Malaysia, it costs almost RM90,000 - more than twice the value as in America. Naturally motorists in America don’t mind paying a higher toll rate since cars are cheaper. But in Malaysia, we are hit with a triple whammy - we pay road tax, road tolls and pay hefty import and excise duties on cars. When the American government builds their highways, the contracts are openly tendered and the whole process is transparent. All contracts, the terms and conditions of the highway contract agreements are opened for public scrutiny. When a contract of US$1 billion is given out, we can safely assume that it is a justifiable cost. On completion of the highway, the operator assumes the risk of a normal business venture. There is no such thing as a government guarantee that the highway toll collected will be profitable. Any loss would have to be borne by the operator and there is no such thing as compensation if the expected profit does not materialise. Can we say the same practice for our Malaysian highway construction? Here in Malaysia, highway contracts are given out without tender. Cost of a RM1 billion highway project is given at RM3 billion to companies dubiously connected to the ruling political party. Terms and agreement of the highway contract are so secretive that they come under the purview of the OSA (Official Secrets Act). Naturally, when inflated values are given to the actual cost of highways, the tendency is that toll rates are calculated based on the inflated rates. What should have been a RM1 collection becomes RM2 because of the inflated cost of the highway. The most ridiculous part of the whole highway contract agreement is that the government provides the operator with an iron-clad guarantee allowing them to increase the toll rates every few years. If toll rate increases are not given, the government gives an undertaking to compensate the operator to the extent of the amount loss in revenue. According to the works minister, an amount of RM2.5 billion was given as compensation to a concessionaire. This alone should create further suspicions as to whether the whole structure of the highway concession agreements was done in a fair and equitable manner. The minister should desist from comparing our toll rates with other countries especially when all other factors are not similar and equal. First and foremost, let us have a look at the highway concessionaire agreements to see if everything is above board. Then let the public judge whether the toll increase is justifiable.

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MORE QUESTIONS For SAMY,VV from Malaysiakinii

On Samy: If you want it, pay for it

Joey Chan: Samy Vellu, all I need you to do is to answer the following questions:

1. What is the annual collection from road taxes by the government? What is our annual collection from the duties on imported vehicles? What is our annual collection from excise duties on all vehicles? Then compare these with the annual road subsidies and maintenance of public roads.
2. In order to compare apples with apples, tell us what percentage of public roads in emerging markets (like
Thailand, Indonesia, Philippines, India and China) are toll roads. Then give us a comparison of the toll rates in such countries on a per km basis.
3. You say that the government cannot afford to continue to subsidise the tolls. Then why did your boss announce an extra RM600 million for Umno constituencies (to be used up in three months!), the RM400 million Istana project, the RM220 million Agricultural Expo project, the RM3 billion
Penang bridge project? These projects can either be delayed or downsized and the surplus funds be used to lessen the burden on the public. What is the reason for not doing it?

When you answer these questions, please look at us in the eye because we are not as dumb as the journalists you faced earlier this week.

Sharon: I'm deeply affected by the toll hike. I'm staying at Lagoon Perdana and I use the toll everyday to send my son to his babysitter. I pay RM3.20 for the toll everyday. Fuel prices have increase, and so are food prices but our salary remains the same.

The kindergarden itself is so expensive. Because of this, I'm scared to have another child (currently I have only one child). I hope all the society groups can fight this toll rise. I can’t take it anymore. My stomach is burning with fire when I think about how to survive and pay for this and that.
Dhammika: The government should immediately and completely remove the toll subsidy. It hurts more to stagger the increases. ‘Semi Value’ should stop comparing rates from other countries. This comparison cannot hold water. The country’s GDP must be taken into comparison as well as the respective strength of the various currencies.
Why must the ministers call a meeting with the editors to gag them from expressing the people’s views? Be more transparent and accountable in the administration of the rakyat’s money. Confiscate the assets and money of the corrupt few to pay for the toll. I hope the ACA will investigate the US$100 million commission paid for the purchase of submarines. Well, the list can go on...
Meng: Don’t complaint, just remember all this gross injustices and remember all the excesses, and the rich MPs and town councilors who squander and rob the people. When the BN government comes with all their sweeteners prior to elections and promises of projects, remember the racial remarks, remember the petrol hike, remember the toll hikes and most of all, remember the arrogant MP who says “if you want it, pay for it.
Who robbed the poor in Malaysia? Look at the auditor-general’s report where money supposed to be used for state development and the poor were channeled to office repairs, camera equipment etc. All this revelation has gone unchecked, and the ACA says it is hard to prosecute without evidence. The ACA should interview the auditor-general to find out about their claims.
The rakyat has one tool of evaluation and that is the ballot boxes

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ABOVE & BELOW; The crowds were orderly and the FRU (Riot police) were there to make sure things do not get out of hand.
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ABOVE: Protest Placard in chinese. Any translator can help? Give your version in the comments below

UPDATE: Dec 17 06: 22:45pm
MORE PICTURES & REPORT Of TOLL Hike PROTEST at Bandar Mahkota Cheras; 800 ANGRY Resident Backed by 4 MPS, 2 Assemblymen With Reps from PAS & Keadilan; BN Component parties MEMBERS “Too SHAMEFUL” to Attend

ABOVE & BELOW: The Dap supporters and leaders were predominant in the 1-1/2 hour protest with some nearby residients staying back until noon to watch

REPORT By Ronnie Lieu

More than 800 residents gathered at the peaceful protest organised by the Bandar Mahkota Cheras Open Access Road Action Committee(BMC-OARAC) today to say no the barricade and also to the toll hikes.
DAP sent its high-level delegation to lend support to the residents.They were 4 MPs from Kuala Lumpur (Dr Tan Seng Giaw, Fong Kui Lun, Tan Kok Wai, Teresa Kok) and 2 State assemblymen from Selangor (Teng Chang Khim and Ng Suee Lim), the Selangor Chiarman Ong Chee Keng and his committee members and leaders from DAP FT. DAP Veteran Club President Lau Dak Kee, former Kajang State Assemblyman Dr Abu Bakar of PAS and former Kajang candidate Lee Cheng Jin of Keadilan and some of their members were also there to give their support and solidarity to the residents. There is no sign of any leaders or members from Umno, MCA, Gerakan and MIC at the demonstration(any surprise?). They are too shameful to show their soiled faces supporting this toll hike and keeping quiet about it

ABOVE & BELOW: The symbolic push against the concrete barrier blocked by Grand Saga “illegally.... Satu, dua , tiga…tolak! From left: Kuan Perk Siong, Steven Chan, Tan Boon Wah, Fong Kui Lun, Tan Kok Wai, Thomas Goh, Teresa Kok;

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BELOW: Dr Abu Bakar, Teng Chang Khim, Peter Tan, Ng Suee Lim

Tan Boon Wah, the Chairman of BMC-OARAC reiterated his strong objections to the barricade and the toll hikes before passing the microphone to DAP leaders. They each gave a short speech to express their undivided support to the residents.

In my speech, I expressed my great disappointment with the Umno-led BN Government for dragging their feet on the matter. We urge the Government to open the access road first and then holding all-party meetings ( between Malaysian Highway Authority(Government), The Lion Group(Developer) ,Grand Saga (Toll Company) and BMC-OARAC (Residents) to resolve the problem. They must not victimise the residents any longer.
I also highlighted the fact that the action commitee has brought the matter to the Parliament, the Minister of Works S. Samy Vellu, MPKj, LLM, The Lion Group and Grand Saga. Even the Prime Minister Department has received our memorandum. There are no more reasons for the Government to drag their feet on the matter.

The RM12 million access road was built by the developer with the approval from the LLM. It was blocked by Grand Saga “illegally”. There is dispute betwen Grand saga and The Lion Group on the question of compensation. Grand Saga is certainly an Umno-related company. But that does not mean that they can do what they want (like blocking the access illegally) without considering the interest of the rakyat. I said Grand Saga has done so illegally because they could not produce any document proof to show that they have the right to block the access during my last meeting with its director Zainal Abidin.

ABOVE: As usual the Police try to cut short the protest by cutting the speeches but eventually a compromise was reach to "make a hole" in the barricade by a bulldozer

Before the gathering was wrapped up, the committee and the police reached a compromise by allowing the bulldozer to knock a big hole right in front of the barricade (instead of pulling down the barricade) as a symbolic protest. The police was led by the new OCPD of Kajang DSP Rosli.

The crowd has agree to come back on 31 Dec 2006 to stage a protest at the 11th mile Grand Saga toll plaza at 10am. The protest will be joined by concerned citizens and representatatives from all opposition parties and NGOs.

Umno is the mother of all evils”.

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The toll hike is tantamount to Robin Hood's reversed nobility - robbing the marginalised affordable (for cars) and helping the super rich cronies with the toll rights - protected by the skewed legalised agreements.
When things are legalised - it becomes unavoidable - "
something that cannot be avoided" - Abdullah or no choice - "have no choice but to go ahead" - Najib. See below their statements in response to queries from newsmen.

There will be a Toll Hike protest on Sunday (17th Dec 2006)- details below

Short is our memory, but long is the pain. Samy Vellu (above) boasted (STAR, Dec 15, see Below) “The Government has kept to its promise of stopping toll collections at sites where the concession agreements have ended He suffered severe memory lapse or his Ministry officials are “sleeping” on their records and cannot provide him with accurate information after 7 years.

Way back in 1999, when DAP formed the CAT (Coalation Againt Toll) in its media statement (see here); it stated (see below)

“one of the greatest injustices of the highway privatisation programme, the continued collection of the 50-sen toll at the Jalan Kuching toll plaza by Kamunting Corporation Bhd for more than three years although its nine-year concession had expired on January 8, 1996.

So don't believe him for sure.
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December 15th, 2006 by ronnieliutiankhiew
Double jeopardy for BMC residents! First, their access road was blocked for months. And now, toll hikes for the Kajang-KL highway.

The Bandar Mahkota Cheras Open Access Road Action Committee has decided to hold a peaceful protest this Sunday morning to say no to the recent toll hikes and to free the access road. The Committee has started distributing a flyer as a notice to the public, inviting all to join the protest. See u there on Sunday!

= = = == = = = Background Bandar Mahkota Cheras Blockade

ABOVE: Ronnie Liu, 2 Dec 2006; Speech in Taman Indah Cheras Branch Dinner

On the case of Bandar Mahkota Cheras blockade, we have met the Director General of Malaysia Highway Authority (LLM) on last Thursday. We were disappointed with him as he has failed to organize the four-party meeting (between LLM, Developer Narajaya and Toll Concessionaire Grand Saga and the BMC action committee). Nevertheless, we have taken the opportunity to voice our disappointment and grievances to him for a better understanding of the episode. We even give him a VCD detailing the struggle of the action committee so far.

The action committee has met on Friday night and resolved that another two weeks will be given to LLM to fix a meeting of all relevant parties. Failing which, the residents will remove the blockade as we believed the barrier set up by the Grand Saga company was illegal. The residents will also demand the developer to pay compensation to the effected residents as the promise of a toll-free access road was stated clearly in their sales brochures and advertisements.

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UMNO-Mother of all evils; December 15th, 2006 by ronnieliutiankhiew

Many Malaysians were furious when they learned that the BN Government has decided to allow the toll hikes up to 60% from 1 Dec 2007 for 5 different highways in the country inspite of the fact that these highways are making tonnes of money and most have recovered their building costs soon after several years of operations (like Gamuda of LDP and Grand Saga of Kajang-KL Highway).
And many Malaysians will blame S. Samy Vellu, thinking that he’s the only bad guy that stood for all the toll concessionaires.

But the mother of all evils is Umno.

Most (if not all) of these toll concessionires were owned by Umno or Umno-related companies. They obtained their concessions directly through the EPU of the Prime Minister Department ( not from the Works Ministry where Samy is the minister).
That explains why all agreements signed with these toll concessionaires were lopsided and totally against the interest of the people. Whether they make money or not, all of them were allowed to increase toll fees every three year, and each increase shall be no less than 20%. The Government even allows them to claim compensation if the traffic flow falls lower than the projected figures.

When they go bust (like the PD-Seremban Highway), the Government must rescue them by bailing out with taxpayers’ money. In the PD-Seremban case, the Government bought it back with a loss of more than RM142 million. The owner, Projek Lebuhraya Utara Selatan Bhd, is certainly an Umno company. When these companies are making money, they are allowed to keep all for Umno and its cronies. Ask PM Abdullah if you have doubts.

es. The mother of all evils is Umno. They are the beneficairies for most (if not all) of the 490 privitised projects throughout the country. None of these companies were owned by DAP, PAS or Keadilan. No use blaming Samy alone. He is serving Umno’s interest so that he can keep his job and the fat allowances and perks that come along with the position. The opposition parties and NGOs will hold at least one protest rally in the Klang Valley to express our disapproval. I will annouce the details in this blog. Hope to see you there in solidarity. But this is not a solution.

The Secretary General of DAP Lim Guan Eng (ABOVE)has suggested that the Government should buy back all the toll concessionaires at a cost of more than RM4 billion in order not to burden the people. It’s a brilliant idea but Umno would not listen.
The real solution is to kick out the mother of all evils in the coming general elections. There is no two ways about. And always remember that a vote for MCA/MIC/Gerakan is a vote for Umno. Period.
Kick out Umno. Do not bring in other issues like “Pas cannot be trusted”, “possibility of Anwar rejoining Umno” and “DAP is a Chinese party” to confuse ourselves.
Dear Malaysians, please wake up to the fact that Umno is the mother of all evils. Umno is the root of all the problems. If Umno lives, Malaysians will die. No?
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Government kept promise to stop tolls after deals ended

Friday December 15, 2006

KUALA LUMPUR: The Government has kept to its promise of stopping toll collections at sites where the concession agreements have ended. Samy Vellu: Says the next toll increase is in 2008. Works Minister Datuk Seri S. Samy Vellu said the Government had ceased collection in three places here and another in Johor. The toll plaza in Cheras was dismantled in September 2003 followed by the ones in Jalan Pahang and Jalan Kuching, while compensation of RM331.7mil was paid before the toll in Senai was closed in 2004, he said.

Samy Vellu (above) having Alzheimer? Where is your bargain??????? Remember Jalan Kuching under Kamunting!

"We've kept our bargain and closed the toll plazas after the expiry of the concession period," he told reporters yesterday. He said toll collection at the 17.5km point of the North Klang Straits Bypass linking Bukit Raja and Port Klang would cease in 2009. Samy Vellu said the next toll increase is scheduled for Jan 1, 2008. Among the highways scheduled to raise tolls are the Ampang-Kuala Lumpur Elevated
Highway, North-South Expressway, Elite, Kulim-Butterworth highway, Second Link in Johor, Seremban-Port Dickson Highway, North Klang Straits Expressway and the Penang Bridge.
from Background H I S T O R Y, 1999 - 7 years ago DAP Lim K S archive

Coalition Against Toll (CAT) calls on Malaysians to protest peacefully at the 100 toll plazas nation-wide on Sunday morning to show their seriousness in wanting the government to review unfair highway privatisation concessions and unfair toll rates
Media Statement by Lim Kit Siang (3/2/99)
(Petaling Jaya, Wednesday): The Coalition Against Toll (CAT) at its second meeting in Petaling Jaya last evening calls on Malaysians to protest peacefully at the 100 toll plazas nation-wide on Sunday morning to show their seriousness in wanting the government to review unfair highway privatisation concessions and unfair toll rates. This will be the second nation-wide peaceful protests by the people at the nation's toll plazas against unfair highway privatisation concessions and unfair tolls, the first being held at over 20 toll plazas last Sunday. The Coalition Against Toll meeting yesterday was attended by representatives from political parties and NGOs, including PAS, Parti Rakyat Malaysia, DAP, DAPSY, Wanita DAP, ADIL, ABIM, Perak Consumers' Association, Selangor
Consumers' Association, Selangor Chinese Assembly Hall Youth. The Coalition Against Toll reviewed last Sunday's first nation-wide toll plazas protest and urges all protestors to be at all times peaceful and civil, avoiding personal or character attacks against anyone in their placards, posters or utterances, and to remain united in their support for the CAT's demand for "Five Nos and Two Yes", namely:
No to Unfair Toll Rate Increase
No to Unfair New Toll
No to Government Compensation
No to Secret Concessions
No to Sell-Out of the People

Yes to Justice for Motorists
Yes to Justice For ALL

The CAT at its meeting yesterday also decided that the second nation-wide toll plazas protest on Sunday would focus on one of the greatest injustices of the highway privatisation programme, the continued collection of the 50-sen toll at the Jalan Kuching toll plaza by Kamunting Corporation Bhd for more than three years although its nine-year concession had expired on January 8, 1996. The protest against the unfair Jalan Kuching toll collection after its expiry in January 1996 will be held on Sunday at 9 a.m.. This is the time for all motorists who feel strongly about the injustice of having to pay 50 sen toll for over three years after the expiry of the concession in January 1996 to demand that Jalan Kuching should become toll free, especially as there had been no upgrading of roadworks whatsoever in the past three years. On 29th April 1996, Malaysians were shocked to read in the local press that Kamunting Corporation Bhd had been given permission by the Cabinet to continue to collect toll at Jalan Kuching for another six months although the concession ended on January 8 of the same year. The Works Minister, Datuk Seri S. Samy Vellu said that Kamunting Corporation Bhd might be granted a further extension to collect toll when the six-month extension ended on July 7, 1996 pending the consideration of the Economic Planning Unit (EPU) in the Prime Minister's Department on the future of Jalan Kuching. In July 1996, Samy Vellu announced that the Cabinet had on July 3, 1996 approved a 33-year concession to Syarikat Prestige that will entitle it to collect RM1 toll at Jalan Kuching when it completes a RM650 million underpass and road upgrading project. Samy Vellu said the RM650 million project also involved the setting up of another toll collection centre at Jalan Semantan, where motorists would have to pay either RM1.30 or RM1.60 to enter the city.

The road upgrading works for Jalan Kuching included adding two lanes to the existing four, constructing a tiered flyover over the Jalan Kuching and Jalan Segambut roundabout, and widening the two lanes on Jalan Ipoh. The underpass would connect the Jalan Semantan/Jalan Damansara interchange to the Jalan Ismail junction (Wisma Sime Darby area) via Wisma Tani, while another underpass would be built from Jalan Raja Muda to Jalan Tuanku Abdul Rahman to connect with the underpass at the Jalan Sultan Ismail junction. Gerakan, MCA and UMNO Ministers should speak up in Cabinet to demand a stop to the 50-sen toll collection at Jalan Kuching toll plaza as no work has been done in the past three years in the extension of the concession in exchange of the RM650 million underpass and road upgrading project. In fact, motorists are incensed that they are forced to continue to pay toll at Jalan Kuching for more than three years when the nine-year concession of Kamunting Corporation had ended on January 8, 1996 and they have been not been convinced that this is fair, just, proper and completely above-board.

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December 15, 2006 22:11 PM

Toll Increase Unavoidable, Says Abdullah

KUALA LUMPUR, Dec 15 (Bernama) -- Datuk Seri Abdullah Ahmad Badawi said the hike in toll rates for five expressways beginning Jan 1 is something that cannot be avoided and he hoped that the people understand and accept the increase. The Prime Minister said the government realised the additional burden borne by consumers, but emphasised that the government was still bearing the subsidy burden of RM2.6 billion after the increase. He said the increase was based on the concession agreement signed with the companies concerned. "It's certainly a heavy burden to raise the toll... that's why it was decided to share the burden. I hope the rakyat can understand," he said after opening the People's Progressive Party's (PPP) 53rd general assembly, here Friday.

As such, the Prime Minister hoped the rakyat would adopt several approaches to reduce their expenses following the latest increase in the toll. Asked on the concession mechanism which stipulated that the government must pay compensation if the concession company concerned suffered losses due to the shortfall in the toll collection, Abdullah said the problem could be in terms of the projected toll collection. He said the construction of tolled highways under the privatisation programme also benefited the consumers where they could avoid traffic jams which occurred in some neighbouring countries. The Prime Minister said that the construction of highways had resulted in land values in the vicinity of the highways going up and benefiting the people concerned besides promoting new growth centres in the area.

Toll Rates Increase Is Not A Matter Of Choice; December 15, 2006 18:24 PM

By Mohd Nasir Yusoff

JAKARTA, Dec 15 (Bernama) -- Datuk Seri Najib Tun Razak said that the increase in toll rates starting Jan 1 was not something that the government wanted to do as a matter of choice. The Deputy Prime Minister stressed that the government have no choice but to go ahead with the increase. "We (the government) have no choice but to go ahead (with the increase) but it has to be on the basis of sharing the burden," he told the Malaysian media. Najib who is on the second day of his four-day working visit here was asked to comment on the increase that was announced by Works Minister Datuk Seri S. Samy Vellu yesterday, which was received with resentment by the highway users. "This is not something that we wanted to do as a matter of choice. Important thing to understand is that to have world class infrastructure facilities, somebody has to pay for that. You cannot have quality highways but you're not willing to pay for it," Najib said. Najib said sharing the burden meant that the government would fork out a considerable amount of money which otherwise would have gone for development but have to be used to keep toll rates at the announced level.

He said if not for that, the toll rates increase could have been higher, citing as example, the Damansara-Puchong Highway toll rate would have been RM2.10 but instead it was fixed at RM1.60. He added that there was an earlier exercise which kept the toll rate at RM1 for much longer in 1999. "It is not that something which we (the government) pass on merrily to the people. We are mindful of the burden but the people too have to realise that world class infrastructure that we talk about so often doesn't come without a cost," he said.


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Govt To Pay RM2.5 Bln Compensation To Highway Concessionaires; December 14, 2006 21:23 PM

KUALA LUMPUR, Dec 14 (Bernama) -- Despite the Government agreeing to increase toll charges at five highways from Jan 1 next year, it still has to fork out a hefty RM2.58 billion in compensation. Works Minister Datuk Seri S. Samy Vellu said the Government had to pay the compensation to the five highway concessionaires because the rates were not in accordance with the concession agreement signed by both parties. Samy Vellu today announced toll hikes in five highways -- Lebuhraya Damansara-Puchong, Lebuhraya Shah Alam, Lebuh Raya Cheras-Kajang, Lebuhraya KL-Karak and Lebuhraya Koridor Guthrie. "Even with the increase, we have to pay so much in compensation. We have to compensate the reduction in the toll rates we are collecting from the public... the Government has to pay the balance. "For LDP, for instance, the Government pays 50 sen for every car using the highway because according to the concession the new toll rate is supposed to be RM2.10 and not RM1.60 as we have announced," he said. Samy Vellu said going by the concession agreements the new toll rates for the five highways would be considerably higher than the rate fixed by the Government. He said the percentage toll increase for the LDP was 60 per cent, Lebuhraya Shah Alam (47 per cent), Lebuhraya Cheras-Kajang (43 per cent) (Batu 9) and 50 per cent (Batu 11), Leburaya KL-Karak (25 per cent) (Gombak) and 20 per cent (Bentong) and Lebuhraya Guthrie (40 per cent). Samy Vellu said the next toll hike would be in 2008 involving seven highways. They are Ampang-KL Elevated Highway, the North South Highway, Kulim-Butterworth Highway, Second Link, Seremban-Port Dickson Highway, North Klang Straits Highway and Penang Bridge. "Although we allow for toll hikes, we make sure the increase is not too high. We also pressure concessionaires to improve and upgrade facilities as localities developed and these costs are borne by toll operators. "At the LDP, we ask the concessionaire to build four new interchanges and an overhead bridge. They have built the facilities, so we can't complain much. They are doing their job," he said. Samy Vellu said toll rates in Malaysia were one of the lowest in the region, with 13.60 sen per km. The toll rate in the Philippines was 35.5 sen per km, Thailand 22.76 sen, China 27.62 sen and Indonesia 14.08 sen.

Works Ministry's Answers To FAQs On Toll Rates; December 14, 2006 19:24 PM

KUALA LUMPUR, Dec 14 (Bernama) -- Following are the Works Ministry's answers to frequently asked questions (FAQs) on toll rates and their increase.

1. Why is there a need to raise the toll rates for the five highways?

The toll rate increases for the five highways are provided for in the respective concession agreements. Nevertheless, the government has studied as to whether it can keep the toll rates at current levels or prevent awarding 100 per cent increases in the rates' review.

The study was done since Jan 2005, and it was found that the toll rate increases for the five highways must be given. The study covered the aspects of traffic volume, concessionaires' financial information and the loan repayments they needed to make for their borrowings to build the highways.

2. Why isn't compensation in the form of extending the concession period used? This method can help consumers as the toll rates will not be raised.

A 100 per cent compensation in the form of concession period extension cannot be given as it will create a cashflow deficit in the highway concessionaires' accounts. Furthermore, why should consumers be burdened with extended toll periods. Consumers should be aware that highway privatisations are done under the build, operate and transfer (BOT) method, whereby they (highways) will become government property when the concession periods end. Thereafter, there will be no toll charges for using them.

Therefore, the government needs to ensure that the concession periods are not be arbitrarily extended as this will be more burdensome for consumers despite the toll rates being kept reasonable levels.

3. Who determines the toll rate of a highway and its increases?

The Privatisation Committee of the Economic Planning Unit (EPU) in the Prime Minister's Department, comprising representatives from the Finance Ministry, Works Ministry, Attorney-General Chambers, Malaysian Highway Authority and relevant agencies will evaluate and assess all the information and data given to ensure the toll rates increases are not excessive.

4. There are perceptions that the concessionaires are already getting very high traffic volumes to ensure sufficient profits. Why does the toll rate still need to be raised?

From a general view, it looks like every highway has achieved its traffic volume targets, but in reality, it is the opposite. In the case of Damansara-Puchong Highway, the mean average is 20 per cent lower that the targetted numbers.

5. The targetted traffic volume used is very high and will never be achieved. The highway concessionaires may be using this to obtain toll rate increases or compensation if the rates are not revised?

The traffic volume targets given by the companies will be carefully evaluated and compared with that arrived at by the Road Planning Division of the Works Ministry. The most realistic one will be used by the EPU's Privatisation Committee for the next stage of negotiations.

6. Why not the government simply take over these highways and extend them as a free facility for the people?

Consumers must realise that highways are alternatives to existing roads. Why should the government take over an alternative to an existing road? In addition, the government will have to bear a very high cost to take over these highways.

Furthermore, the toll charges are only imposed on users of the highways. If users do not want to pay the toll, they can use the alternative roads. The government is also responsible to provide free infrastructure to the people.

Development of highways also involve many investors and they take huge risks whether the highways will be profitable or otherwise. If the government takes over the highways, it will give the administration a bad image. This will make investors lose their interest to invest in Malaysia, and subsequently, employment opportunities and economic growth in the country will not be generated.

7. The Highway Concession Agreement is said to be unfair and only benefits the concessionaire?

The government will ensure that the concession agreement will yield a win-win situation to both parties. All the terms in the agreement are studied and carefully reviewed by the Attorney-General's Chambers. Among the clauses attached is the Toll Review Mechanism. Under the mechanism, if the actual traffic volume is higher that the targetted volume, then the concession company may not receive any increase or only a partial increase in toll rates and the Government does not need to pay compensation.

8. Is the toll rate increase due to the hike in oil prices early this year?

No. The toll rate increase has nothing to do with the oil prices hike. It is provided for in the concession agreement, and it has been evaluated with care before being approved.

9. Why does the government refuse to continue to subsidise the toll? It can help reduce the burden on consumers.

Consumers must understand that it is better to use the money saved for developing other infrastructure that can benefit the people. Apart from that, it is also not fair for the government to be burdened with having to pay high compensations for alternative routes.

Every user of the highways must pay for the facilities in line with the users-pay concept.

10. Despite the high toll rates, traffic congestions still occur on highways.

Various measures have been taken by each concession company to ensure smooth driving on the highways. Sometimes traffic congestion cannot be avoided due to several factors peak-hour traffic, accidents or vehicles breaking down.

Nevertheless, if the congestion is due to the highway itself, the concession company will be directed to upgrade the infrastructure to improve traffic flow.

11. Are the toll rates imposed compatible with the service and comfort provided by these highways?

The Malaysian Highway Authority constantly monitors every highway to ensure that the concessionaire provides quality services and are appropriate to the toll rates they charge. Among the facilities provided are suraus, rest & service areas, emergency telephones and highway patrol teams. In addition, high-technology facilities like intelligent transportation systems are also provided for users' convenience.Therefore, it is only proper for users to consider these facilities and the comfort they obtain for every sen they pay for using tolled highways compared with the congestion and time wasted when using traditional roads.

12. Are the toll rates in Malaysia high compared to other countries?

The toll rates imposed in Malaysia are way lower than the rates charged by neighbouring countries. Furthermore, there are several routes in these countries where there are no alternative roads to tolled highways, which can be quite costly to use. The toll rates per kilometre in some of these countries are as follows:

The Philippines - 35.57 sen/km

Thailand - 22.76 sen/km

China - 27.62 sen/km

Indonesia - 14.80 sen/km

The factors that are considered in determining toll rates increases are:

i. The initial toll rates are not too high;

ii. The increases make sense and based on specific periods and not made too often; and

iii. The increases will not burden consumers but high enough for the concession companies to pay their monthly loans, operating and management costs.

Other aspects that the government has to consider before approving a toll rate increase:

i. The total amount of traffic using the highway, whether it meets the target or not;

ii. The increase will not burden consumers;

iii. The services and facilities provided justify the toll rate increase;

iv. The amount of compensation need to be paid by the government if it does not approve the increase in toll rate;

v. The government has sufficient funds to pay the compensation for not allowing toll rates to be raised; and

vi. If the allocation needed to pay compensation for not having the toll rates raised can be better used for other development projects that will yield more benefits to the people
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