Citing debt, PKR MP questions MRT3 financial model

 

Tanjong Malim MP Chang Lih Kang has expressed doubts about the sustainability of the government’s financial model for the MRT3 project.

In a statement today, the PKR lawmaker alleged that the financing entities and operator for rail projects, Prasarana Malaysia Berhad and DanaInfra Nasional Berhad, had breached their debt levels.

“To date, government loan guarantees for DanaInfra and Prasarana have breached RM110 billion and are expected to rise further with the MRT3 project,” said Chang.

Additionally, he claimed that the performance of the MRT1 project could provide a projection for the MRT2 and MRT3.

“As reported by the Finance Ministry, DanaInfra and Prasarana recorded debts at RM76 billion and RM38.9 billion respectively by June end 2021.

“These sum up to a total of RM114.9 billion, which is about 60.3 percent of total off-budget government committed guarantees.

“In early March, the Finance Ministry committed up to RM50 billion in financing for the MRT3 project,” he added.

Tanjong Malim MP Chang Lih Kang

Chang alleged that similar to MRT1 and MRT2, the RM50 billion cost for MRT3 will likely be financed by a government loan guarantee under DanaInfra.

“Hence, DanaInfra’s debt is expected to breach the RM126 billion with the implementation of the MRT3 project.

“That is approximately 40 percent of our country’s budget for 2022,” he said.

‘Rakyat would be burdened’

Chang claimed that if the ridership for the MRT2 and MRT3 projects did not match the government’s expectations, Prasarana would not be able to sustain itself.

“Hence, if ridership for the MRT2 and MRT3 does not work out to be what the government has envisaged, Prasarana would not be able to self-sustain.

“It could mean the government has to service their loan because it is a government-guaranteed loan.

“The country and the rakyat would be burdened by this imprudent way of spending,” he added.

Further, Chang claimed that the auditor-general had flagged DanaInfra in its 2018 report as one of the five companies that could not fully service loans accordingly.

“The government ended up injecting RM1 billion to DanaInfra to pay part of its debt.

“While we do not expect public transport to be highly profitable, construction and operation of the rail infrastructures must be funded by sustainable means,” he said, before repeating his earlier calls to halt the project.

Previously, Chang had called for the government to halt its implementation of the MRT3 project in order to allow more scrutiny over the project by the parliamentary select committees.

Malaysiakini has reached out to Prasarana and DanaInfra for comments on the matter but has yet to receive a response.  - Mkini