Toll rate review next year, 5% seen


  • Business
  • Tuesday, 28 Jul 2015

Rate hike: File picture shows a segment of PLUS’ North-South Expressway. Toll rates have not been increased for the past 10 years but highway operators have been compensated by the Government for their reduced income for keeping the rates unchanged.

KUALA LUMPUR: Toll rates under the biggest highway operator in the country – PLUS Malaysia Bhd – will be up for review next year.

However, instead of a 10% rate hike, the quantum that is being looked at is about 5%, said sources.

Nevertheless, the final decision on the toll rates proposed by PLUS would depend on the Government. The source also dismissed any possibility of a toll rate hike this year.

“For sure there will be no toll rate hike this year as stated in the concession agreement when PLUS Expressways Bhd (PEB) was privatised at the end of 2011. And the toll for Penang Bridge will remain the same,” the source said.

The possibility of a toll rate hike had hogged the headlines last month but PLUS’ head of corporate communications, Mohd Nizam Ismail, was reported to have said that it was a matter discussed in the social media and did not involve the highway operator.

Toll rates have not been increased for the past 10 years but highway operators have been compensated by the Government for their reduced income for keeping the rates unchanged. For instance, an operator such as PLUS is entitled to a 10% hike every three years.

When PEB was privatised by UEM Group Bhd and the Employees Provident Fund, there was a revised concession agreement.

Under the revised agreement, PLUS agreed to waive RM6.2bil of compensation claims due from the Government then. The revised concession agreement also allowed for scheduled toll hikes of 5% every three years (1.7% per annum) from 2016. The earlier concession agreement had allowed for 10% every three years, taking into account inflation.

PLUS operates and maintains almost 1,000km of expressways, stretching from the border of Thailand in the north to the border of Singapore in the south, namely the North-South Expressway, New Klang Valley Expressway, Federal Highway Route 2, Elite Highway, Linkedua (Malaysia-Singapore Second Link), Seremban-Port Dickson Highway, Butterworth-Kulim Expressway and the Penang Bridge.

According to the Association of Highway Concessionaires Malaysia, there are currently 20 highways out of 31 that are due for a toll rate hike as per their respective concessions, but the Government has yet to make a decision.

Toll rate hikes are specifically under the purview of the Public Works Department and the Malaysian Highway Authority.

Meanwhile, Deputy Works Minister Datuk Seri Rosnah Abdul Rashid Shirlin was quoted in a news report that 17 expressway operators would receive compensation this year.

It is understood that the Government is expected to pay RM558.7mil to compensate toll concessionaires following a decision not to raise toll rates at 20 highways. The Works Ministry has approved the payment of RM458mil so far.

Apart from highways, the light rail transit (LRT) and monorail fares, which have not been revised for 12 years, had been speculated for a hike earlier this year, but this was brushed off by the Land Public Transport Commission (Spad).

The commission said it had no intention of increasing the fares of the LRT and Putra monorail line as yet, and that the current fare would be maintained until Spad makes a final decision on the matter.

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