Anwar throws down the toll hike GAUNTLET but will Najib follow & put the people FIRST

UPDATE2 KUALA LUMPUR - Opposition Leader Anwar Ibrahim has thrown down the gauntlet to Prime Minister Najib Razak, and all eyes are now on whether the latter will accede to public wishes and axe his unpopular plan to hike toll rates by an exorbitant 50 sen to RM2 effective Jan 1, 2014.

At a press conference on Wednesday, Anwar announced that the Selangor state government would use its stakes in 3 toll firms to reject any attempt to raise toll.

According to Anwar, Selangor chief minister Khalid Ibrahim has agreed with the Opposition's plan to use the state's minority shares to oppose the toll hike. The country's richest state, Selangor is governed by Anwar's Pakatan Rakyat coalition which consists of 3 parties - DAP, PAS and PKR.

"I understand that the issue will be brought to the state exco meeting today and orders will be given out to government representatives in the highway consortium involved, to reject the hike in toll," Anwar told a press conference.

Selangor owns 30% of the Kesas highway through state-owned Selangor State Development Corporation (PKNS) and 20% in Sprint and the Lebuhraya Damansara-Puchong (LDP) through Kumpulan Perangsan

Taking a leaf from Anwar and Pakatan

Indeed, Najib could take a leaf from Anwar and direct stakeholders linked to the federal government to follow suit and vote against the hike.

"It is a matter of whether Najib wants to stick his neck out and whether he is sincere about putting the people first or profits first. On test now is the Umno-BN coalition's sincerity. They have broken a cardinal promise in their general election manifesto where they promised to try to lower toll rates. Now we are looking 50 sen to RM2 which is way too much especially with electricity tariffs and other costs of living due to be raised next year," PKR vice president Tian Chua told Malaysia Chronicle.

Najib's federal government has come under intense public fire for reneging on pre-election promises and trying to hike toll on 15 highways next year.

The highways include the New Pantai Expressway (NPE), Damansara Puchong Expressway (LDP), Ampang-Kuala Lumpur Elevated Highway (Akleh), Western KL Traffic Dispersal System (Sprint), Konsortium Expressway Shah Alam Selangor (Kesas), Kuala Lumpur-Putrajaya Maju Expressway (Mex), Sungai Besi Highway (Besraya), Stormwater Management and Road Tunnel (Smart) and Sistem Lingkaran-Lebuhraya Kajang (Silk).

Fight-back against "greedy" operators

Meanwhile, Najib has warned that he is not a "populist PM" while his ministers have claimed that it was impossible to stop the toll rate hike. However, the Opposition have exposed information showing that Najib can actually block an increment from being pushed through by "greedy" operators.

Rafizi Ramli, the PKR strategic director at the centre of the party's toll-hike fightback, had earlier this week revealed that most of the concessionaires were controlled by tycoon cronies of the ruling Umno party as well as by government-linked agencies.

Rafizi had also exposed the "obscene profits" the toll concessionaires were already making. He pointed out that PLUS Berhad, which operates 6 highways, enjoyed a pre-tax profit of RM2.5 billion in 2011 or approximately 61 per cent of revenue, while Litrak, the operators of Puchong-Damansara Expressway (LDP) and Sprint, registered a profit before tax of RM180 million or 49 per cent.

Another concessionaire, Kesas Highway, recorded 121 per cent profit annually from 2008 to 2012.

“Seeing that the cost to maintain the highways is only 6 per cent of the total toll collection each year, this shows that the current toll rate is too high and gives multiple profits to PLUS,” said Rafizi, who is also the MP for Pandan.

He said that based on PLUS Berhad’s 2011 financial statement and annual report, the toll concessionaire collected RM4.098 billion in toll in 2011, but spent just RM241 million as maintenance costs in 2010. As for Litrak, based on its latest annual report of its 2013 finances, the maintenance cost for highways was a mere six per cent of the RM369 million collected in toll.

Rafizi also claimed that the number of vehicles plying the various highways has been increasing over the years, thus making it unnecessary to increase toll rates.

Back-pedal? Pay toll to join traffic jam!

Indeed he found an odd ally in arch rival Umno Youth, who also called on the Najib administration to reconsider as many of these 'highways' were already congested and did not fulfill their claim of being alternatives to the existing traffic-packed public roads.

"In fact, some highways are no longer alternative routes to consumers and these have caused congestion. In other words, pay toll to enter a traffic jam ... (in this scenario) a toll rate hike will risk raising the ire of road users," Bernama reported Khairul Azwan Harun as saying.

Works Minister Fadhillah Yusof and Wahid Omar, Minister in the Prime Minister’s Department have said it was impossible to stop the toll rate hikes due to the concession agreements between the government and highway firms.

They said the government had to fork out RM400 million in compensation to toll concessionaires after it froze a revision of the toll rates that were meant to be implemented in 2011 under the concession agreement.

Nonetheless, facing intense pressure especially with the latest challenge from the Opposition, the Najib administration may be forced to backpedal on the unpopular hike, which Rafizi has termed as being an additional "form of taxation".

Already Fadhillah has issued a clarification that no final decision had been made yet.

“No, I never confirmed but I’m saying as per agreement. There is no decision from the Cabinet yet,” he was quoted as saying by the Star. - Malaysia Chronicle