CAP urges govt to declassify highway concession agreements

 

The Consumers’ Association of Penang (CAP) has urged the government to declassify highway concession agreements to improve transparency in decision-making.

The group highlighted how, despite highways and tolls coming under public interest, several concession agreements remain classified under the Official Secrets Act (OSA).

“As a result, no part of such an agreement may be disclosed to the public without the consent of both the government and the concessionaire,” said CAP president Mohideen Abdul Kader in a statement today.

He also said that, regardless of whether classifications have been lifted, most agreements still contain strict non-disclosure clauses based on commercial confidentiality.

Hence, these clauses often prevent publicising such information without the consent of the concessionaires, even if the government may be inclined to do so.

“In practical terms, classification under the OSA does not necessarily mean that the public can never see these contracts.

Consumers’ Association of Penang president Mohideen Abdul Kader

“Rather, it means that without explicit approval from the government and the concessionaire, or a formal decision to reclassify the document, the full text cannot be freely published or widely distributed,” he said.

This matter, he explained, would be best mitigated by declassifying and publicising these agreements altogether, to ensure that they are open to public scrutiny.

End concessions, restore public control

Further, Mohideen also called upon the government to take full control over a highway once its specific concession agreement comes to an end.

He reminded that it has been nearly four decades since Malaysia first decided to introduce tolled highways and privatisation, and that many concession agreements were long-term in nature, spanning 30-50 years.

While he acknowledged that the concessions were necessary to accelerate highway development without straining the federal budget, he also stressed that the details of such agreements should still be made transparent.

“In many jurisdictions, public-private partnership contracts are published, with only narrowly defined commercially sensitive sections redacted.

“Such transparency allows Parliament, civil society, and independent experts to assess whether risks are appropriately allocated and whether the public is receiving value for money.

“If Malaysians are expected to bear the fiscal consequences of these agreements, it is reasonable that they should be able to see the terms that created those obligations,” he added.

Public bears hidden concession risks

Mohideen also highlighted that there have been repeated calls for transparency as early as 2008, and cited Petaling Jaya MP Lee Chean Chung’s calls for full declassification of the PJD Link concession to be examined in Parliament as a recent example.

However, he noted that “these calls have so far been resisted on the grounds of the OSA and contractual confidentiality,” even though advocates have argued that toll concessions are major public contracts which deserve full and open disclosure.

Mohideen also said a central part of these agreements includes toll rate adjustments where the government provides compensation to investors if traffic falls below expected thresholds.

Likewise, when the government chooses to freeze toll rates, especially during festive seasons, these agreements may also require the government to compensate the concessionaire’s revenue shortfall or financial losses.

In today’s statement, he voiced out against compensating concessionaires under such circumstances, reminding that “risk is an inherent element of any business venture, particularly when the contractual basis for such compensation is withheld from public scrutiny.”

“CAP maintains that such concession agreements should be made public, as Malaysians are entitled to know what is embodied in them,” he stressed. - Mkini