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10 APRIL 2024

Wednesday, January 4, 2017

NAJIB’S MRT ‘LEGACY’ FAST TURNING INTO HUGE FINANCIAL DISASTER: PRASARANA MAY BUCKLE UNDER RM70BIL OF DEBT- RAFIZI

Citing the firm’s audited financial statements for 2014 and 2015, PKR vice-president Rafizi Ramli wants to know how public transport company Prasarana Malaysia Bhd will be able to finance the Mass Rapid Transit (MRT) project.
DanaInfra Nasional Bhd, created by the Finance Ministry, is set to transfer the costs of the MRT project upon completion to Prasarana, which is the operator of buses and light metro services.
On Oct 26, 2015, DanaInfra confirmed it would commence an integrated programme to finance both the MRT 1 and MRT 2 projects. As of Oct 2015, DanaInfra had a debt amounting to RM17.6 billion in financing the MRT 1 project.
Rafizi said Prasarana’s audited financial statements for 2014 and 2015 showed that its operating cost for both years were more than its ticket sales and other profits by 13 percent and 30 percent respectively.
“Interests to be paid for the debts, on the other hand, reached RM551 million for 2015 and is expected to continue to increase,” he told reporters in Kuala Lumpur today.
“For the year 2015, Prasarana’s debts reached RM18 billion and this, too, is expected to increase based on the average amount of debts incurred from 2013 to 2016,” he added.
The government, on the other hand, had been forced to inject new funds into the company from time to time, added Rafizi.
“With Prasarana’s current financial standing, the taking over of operations as well as MRT’s debts will worsen its position.”
And by 2022, Rafizi estimated that Prasarana’s debt will hit RM70 billion, based on rough estimates and the payment of interests of RM2 billion a year.
With such debts, this would even “defeat” state investment arm 1Malaysia Development Bhd’s record, Rafizi pointed out.
Meanwhile, Rafizi continued to insist that the MRT project would cost more than RM100 billion. Rafizi has consistently claimed that the cost of the whole project would exceed RM100 billion.
The Pandan MP said DanaInfra’s statement in 2015 had confirmed that the cost of the whole MRT project was indeed more than RM100 billion as the funding for both the MRT 1 and MRT 2 project was more than RM50 billion.
And the costs, he added, would ultimately be borne by the rakyat.
This, he said, would either be in the form of the increase in the standard rate of the goods and services tax (GST), or increase in public transport fare prices.
“If you want to see the GST rising to eight percent, vote for (Prime Minister) Najib (Abdul Razak). After the elections, it will definitely increase to eight percent,” said Rafizi.
Today’s press conference was a continuation of Rafizi’s series of press conferences since last week on the MRT issue as well as matters concerning the Federal Land Development Authority (Felda).
Rafizi had noted how the public was more concerned about the MRT project as opposed to the Felda issue.
“The attention that is given by the public on MRT and Felda is (a ratio) of three to one.
“[…] the public is first and foremost concerned on who is going to foot the bill. The rakyat understands that this is a ‘huge disaster’,” added Rafizi.
– M’kini

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