Latest news with #RM568.92
Focus Malaysia
3 days ago
- Business
- Focus Malaysia
Abolishing tolls not feasible without billions in govt funding, says Works Minister
THE Ministry of Works has admitted that eliminating toll charges entirely is far from straightforward, especially when factoring in the heavy financial burden it would place on the government. According to Minister Datuk Seri Alexander Nanta Linggi, the main challenge lies in securing adequate funding. Without toll collection, the government would have to foot the bill for highway upkeep, a cost that could potentially reach into the billions. 'Our view is that it's not easy to abolish tolls. If we do, the government will need to find a massive amount of funding to carry out maintenance works. So, for this purpose alone, billions of ringgit would be required,' he said during a session in the Dewan Rakyat today. He added that using such vast sums for highway maintenance might not be the most efficient use of public funds, saying, 'If that's the case, we can imagine that such funds could be better allocated elsewhere, for example, in Terengganu, Sarawak, or Sabah.' The Minister made these remarks while addressing a follow-up question from Datuk Che Mohamad Zulkifly Jusoh (PN–Besut), who brought up an election pledge made by the opposition to abolish tolls if they came to power. He also inquired about the potential consequences of implementing such a promise. Rather than removing tolls entirely, Alexander proposed a more feasible solution: lowering toll rates. However, this would depend on whether the concessionaires have already recouped their investments. 'There may be no need to abolish tolls altogether. If the concession period has already yielded sufficient profit or ROI, then perhaps the toll rates, currently seen as burdensome, could be reduced. That would be more realistic,' he explained. Earlier in the same session, Alexander responded to a question from Datuk Seri Sh Mohmed Puzi Sh Ali (PN–Pekan) regarding the financial impact of freezing toll hikes. He revealed that the government had paid a total of RM568.92 mil in compensation to the operators of 10 highways as a result of this move. He noted that this deferment had brought relief to around 941,000 motorists using those highways. 'The actual compensation amount the government needs to pay to concession companies due to this deferment depends on real traffic volumes. This RM568.92 mil figure is an average based on previous data, but the final figure is subject to audit verification by both the government and the concessionaires,' he clarified. Just last week, Prime Minister Datuk Seri Anwar Ibrahim, who also holds the Finance Minister position, confirmed that toll hikes for 10 expressways would be postponed. This decision aims to keep travel costs steady for the public. The affected highways include major routes such as the Senai–Desaru Expressway (SDE), East Coast Expressway Phase 2 (LPT2), South Klang Valley Expressway (SKVE), Butterworth Outer Ring Road (LLB), and the KL–Putrajaya Expressway (MEX). Addressing Mohmed Puzi's original question, Alexander highlighted that motorists using these routes would experience considerable savings, especially when comparing current toll rates with what was originally outlined in the concession agreements. He pointed out that for Class 1 vehicles, toll increases were scheduled to rise between RM0.50 and RM4.56, which translates to hikes of 79% to 83%. 'For example, a Class 1 vehicle user travelling through the Putrajaya Toll Plaza on the MEX Highway for their daily commute would enjoy savings of RM6.80 per round trip. 'If these savings are calculated over 20 commuting days per month, or 240 days per year, the user would save around RM136 a month, or RM1,632 annually,' he said. —July 29, 2025 Main image: Utusan Malaysia
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New Straits Times
3 days ago
- Business
- New Straits Times
[UPDATED] Billions needed for highway maintenance if tolls abolished
KUALA LUMPUR: The government cannot simply abolish highway tolls, as doing so would require the allocation of billions of ringgit for highway maintenance and related costs, said Works Minister Datuk Seri Alexander Nanta Linggi. Speaking in the Dewan Rakyat, Nanta said a more practical and realistic approach would be to reduce toll rates after the concessionaires have recovered their return on investment. His remarks were in response to a supplementary question from Datuk Che Mohamad Zulkifly Jusoh (PN–Besut), who asked about the government's previous manifesto pledge to abolish tolls. "It is not easy to abolish tolls because if they are removed, the government will need to secure substantial funding for maintenance and related works. "For this reason alone, we're looking at billions of ringgit. If that's the case, we could instead use those funds for development in states like Terengganu, Kelantan, Sabah, and Sarawak, where highways are less frequently used," he said. "This is my take, and the government may be looking at it this way too, that we don't need to abolish tolls, but if the concessionaires have already made a profit or achieved their return on investment, we can look into reducing the toll charges, which would be a more practical and realistic approach," he said. Meanwhile, on the postponement of the toll rate hike, he said the government will have to bear compensation costs to the concessionaires, estimated at RM568.92 million. "However, the actual amount of compensation to be paid by the government is subject to actual traffic volume and verification by the government's and concession companies' operational auditors. "So, the RM568 million is an estimate based on past data, but the final figure is subject to operational audit verification. "The toll hike postponement will benefit 941,000, nearly 1 million users who use the affected highways," he said. On July 23, Prime Minister Datuk Seri Anwar Ibrahim announced that toll rates for 10 highways will remain unchanged this year. He said the government will bear over RM500 million in costs to maintain the current toll rates, despite contractual obligations for adjustments.
