DAP wants more details on MRT project
Shazwan Mustafa Kamal
KUALA LUMPUR, Dec 21 — The DAP demanded today detailed plans of the mass rapid transit (MRT) project in Klang Valley, raising doubts as to how the federal government plans to pay for the project.
Tony Pua, the party’s national publicity secretary, said the Najib administration should also explain why the project was being rushed way before the implementation of a detailed public transport plan by the Land Public Transport Commission (SPAD) which will only be ready in September next year.
“Datuk Seri Najib Razak must disclose how the MRT will be financed and why the project is expected to commence before even the urban public transportation plan is ready,” said Pua in a statement.
Although the DAP politician acknowledged Najib’s move in making sure that the MRT project was done via open tender through nine project parcels, he claimed that the prime minister was forced to do this after “strong criticisms” against his earlier remark in October that “there are some contracts that you just cannot tender out”.
“The announcement also indicated that the government will own and finance the project in its entirety. However, this raises further questions on how the government, via Syarikat Prasarana Negara Bhd, will be able to bear the entire cost of the project, estimated at RM36 billion, before taking into account land costs of an additional RM10 billion.
“As of today, Prasarana is already heavily indebted with RM8.5 billion in bonds which it is unable even to service the interest. This has been heavily criticised by the Auditor-General’s report in 2009 for making accumulated losses of RM840 million as of December 2007, in part due to suspicious activities and mismanagement. In the 2011 budget, the government had to allocate RM2.5 billion to bail out Prasarana-issued bonds which are due in November 2011,” said Pua.
He said transparency of the entire funding process of the project was important as it could “affect” the fees to be charged to MRT commuters when it was finally ready to be used.
“For example, last year’s audit report on Prasarana showed that the current average LRT fare of RM1.60 has to be increased to nearly RM9 for the LRT infrastructural costs to be fully recouped within the next 20 years despite the LRTs costing the federal government less than RM8 billion, nearly five times less than the proposed MRT system,” he said.
What was most worrying, according to the DAP man, was the government’s insistence on rushing through with the project before SPAD’s 20-year urban public transport plan was even introduced, and how the Cabinet had already gone ahead and rewarded the contracts for the construction work on it.
“In fact, SPAD is still unable to declare, as of today, backed by a thorough and professional study that the MRT is the best option for the Klang Valley in the near future, as opposed to cheaper alternatives like buses or even trams based on travel patterns and population statistics,” said Pua.
Last Saturday, Najib said the implementation of the project is expected to generate a gross national income (GNI) of between RM3 billion and RM4 billion beginning next year until 2020.
He had said that between RM8 billion and RM12 billion was expected to be generated in terms of spinoffs from the construction of the MRT project.
“It is highly misleading for the prime minister to espouse the viability of the project by claiming that it will generate gross national income of up to RM4 billion per annum when the interest servicing cost for the project at completion may in itself come up to more than RM2 billion each year,” Pua said.
The MRT, the largest infrastructure project in Malaysia, is an economic entry point project identified for the Greater Kuala Lumpur/Klang Valley National Key Economic Area under the Economic Transformation Programme.
KUALA LUMPUR, Dec 21 — The DAP demanded today detailed plans of the mass rapid transit (MRT) project in Klang Valley, raising doubts as to how the federal government plans to pay for the project.
Tony Pua, the party’s national publicity secretary, said the Najib administration should also explain why the project was being rushed way before the implementation of a detailed public transport plan by the Land Public Transport Commission (SPAD) which will only be ready in September next year.
“Datuk Seri Najib Razak must disclose how the MRT will be financed and why the project is expected to commence before even the urban public transportation plan is ready,” said Pua in a statement.
Although the DAP politician acknowledged Najib’s move in making sure that the MRT project was done via open tender through nine project parcels, he claimed that the prime minister was forced to do this after “strong criticisms” against his earlier remark in October that “there are some contracts that you just cannot tender out”.
“The announcement also indicated that the government will own and finance the project in its entirety. However, this raises further questions on how the government, via Syarikat Prasarana Negara Bhd, will be able to bear the entire cost of the project, estimated at RM36 billion, before taking into account land costs of an additional RM10 billion.
“As of today, Prasarana is already heavily indebted with RM8.5 billion in bonds which it is unable even to service the interest. This has been heavily criticised by the Auditor-General’s report in 2009 for making accumulated losses of RM840 million as of December 2007, in part due to suspicious activities and mismanagement. In the 2011 budget, the government had to allocate RM2.5 billion to bail out Prasarana-issued bonds which are due in November 2011,” said Pua.
He said transparency of the entire funding process of the project was important as it could “affect” the fees to be charged to MRT commuters when it was finally ready to be used.
“For example, last year’s audit report on Prasarana showed that the current average LRT fare of RM1.60 has to be increased to nearly RM9 for the LRT infrastructural costs to be fully recouped within the next 20 years despite the LRTs costing the federal government less than RM8 billion, nearly five times less than the proposed MRT system,” he said.
What was most worrying, according to the DAP man, was the government’s insistence on rushing through with the project before SPAD’s 20-year urban public transport plan was even introduced, and how the Cabinet had already gone ahead and rewarded the contracts for the construction work on it.
“In fact, SPAD is still unable to declare, as of today, backed by a thorough and professional study that the MRT is the best option for the Klang Valley in the near future, as opposed to cheaper alternatives like buses or even trams based on travel patterns and population statistics,” said Pua.
Last Saturday, Najib said the implementation of the project is expected to generate a gross national income (GNI) of between RM3 billion and RM4 billion beginning next year until 2020.
He had said that between RM8 billion and RM12 billion was expected to be generated in terms of spinoffs from the construction of the MRT project.
“It is highly misleading for the prime minister to espouse the viability of the project by claiming that it will generate gross national income of up to RM4 billion per annum when the interest servicing cost for the project at completion may in itself come up to more than RM2 billion each year,” Pua said.
The MRT, the largest infrastructure project in Malaysia, is an economic entry point project identified for the Greater Kuala Lumpur/Klang Valley National Key Economic Area under the Economic Transformation Programme.
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