Former transport minister warns against takeover of highway operator PLUS

Former transport minister Datuk Seri Ong Tee Keat is against the takeover offer for the North-South Expressway (PLUS) by a private entity.

He warned that in a worst case scenario, it may even result in layoffs of employees as the country's largest highway toll concessionaire has to grapple with rising costs of maintenance and other factors.

Ong (pic) said promises by the bidding company to not increase toll charges for the next 24 years of the concession agreement and offer a 50% discount for daily commuters, were "carrots" which could become untenable due to unpredictable variables.

"At the end of the day, if at all they can't deliver on their promises, would they turn to the government, asking for a bailout?

"In the worst possible scenario, the issue of a bailout will come into play, and who is going to suffer? The people, and this is not unprecedented in our history, " he said in an interview.

He said these were the possibilities that ought to be looked into by all those concerned with decision-making on the takeover bid.

"I'm not trying to make any pre-emptive remark against anybody, but rather, am more concerned about whether, our nation would benefit from such a move. That's the main bone of contention," he added.

Ong said it was necessary for a key infrastructure and national asset like PLUS to continue to be owned by government entities like UEM and the Employees Provident Fund (EPF).

"National assets are supposedly meant to serve the interest of the people and not enrich any individuals or private entities.

"Hence, continuing to stay firmly in the government's grip is one of the pre-requisites to ensure that people-centric goals are achieved," he added.

Last week, the Head of Civil Engineering at the Malaysian campus of the University of Nottingham, Ionnes Y.H. Tang, said he had serious doubts if the company would be in a position to implement the offer.

This is given the volatility in the price of oil which has a direct bearing on the price of key materials like bitumen used for road repairs and maintenance.

Elaborating on the spectre of a bailout, Ong said it would again burden the people because the money would come from tax-payers.

He said he was not prejudiced nor suspicious of private companies, but was merely highlighting the various possibilities associated with such promises made.

Ong said private entities undertaking any concession were primarily profit-oriented and less likely to manage it as a social responsibility.

"Any monetary profits they rake in through such a critical national infrastructure would considerably benefit only the shareholders.

"In the event that the concessionaire finds it untenable in terms of profit and loss due to whatever reasons, it is very likely then that the government might be asked or called on to undertake a bail out again with public funds.

"This will hurt the people once more and it is what we don't want to see," he added.

He said that EPF, as co-owner of PLUS, had some 14 million contributors and it would not be in their interest to dispose of the stake in the highway concession, coupled with the fact the organisation was able to declare commendable dividends each year.

"But by and large, I can see that the average citizen's psyche is two-fold.

"On the one hand, the general public would love to have the monetary gain generated by the North-South Expressway be shared by the entire nation, the entire populace.

"On the other hand, PLUS users per se will certainly yearn for a more affordable and less burdensome toll rate, but not at the expense of the maintenance of the infrastructure," Ong said.

He said PLUS, spanning the length of Peninsular Malaysia, will continue to play a key role in stirring up the economic growth of townships and industries as well as tourism along the West Coast, but not without new changes and challenges.

"Firstly, there is ever increasing number of vehicles using the infrastructure.

"Secondly, increasing reliance on public transportation that serves as a mass mover, an efficient mass mover in modern days. Thirdly, the increasing competition posed by other modes of transportation such as rail transport and more affordable air services, will continue to compete with the expressway," Ong added. – Bernama