While the works minister is brandishing the potential compensation figure of RM38 billion to ward off protests against the 10 percent toll increase by Plus, I wonder how many recall the original tender submissions for the construction of the North-South Expressway in mid-80s?
The lowest submission of the four tenders then was only RM3.2 billion. Despite being the least qualified of the four, United Engineering Malaysia (UEM, then owned and controlled by Umno) was awarded the contract on a design-build-finance and operate basis.
By the time the project was completed, the construction costs had inexplicably ballooned to RM6 billion, with the bulk of the financial outlay covered by a government soft loan.
Since Plus (a subsidiary of UEM) started to collect toll in 1988, the following have taken place:
- the toll collection period has been extended from 30 years to 42 years (expiry extended from 2018 to 2030) in exchange for the toll rate hike interval deferred from every one year to every three years.
- by 2002, the toll rate (for saloon cars) has escalated two and a half times, from 5 sen per kilometre to 12.36 sen per kilometre.
- on top of the toll rate increases, the government has been and will continue to pay hefty compensation every year to Plus for deviating from the original terms of the contract in respect of toll rate increases.
- Plus collected RM1.58 billion in toll charges in 2003.
Considering the fact that the number of vehicles on the road has been growing by two digit percentages every year, and considering the inevitable heavy toll rate increases every three years, Plus is positioned to make tens of billions of ringgit in profits as we - as well as our children - are squeezed dry in the decades ahead.
And how much did the NS Expressway cost? Only a couple of billion ringgit. And even that was mostly provided by direct government soft loans or government guaranteed loans.
In other words, the people had financed the construction of the project with Plus hardly coming up with any substantial capital. This must be one of the most one-sided contracts in the world between a government and a private body with latter laughing all the way to the bank!
As a first step to rectify the wrongs done to the people, the government must disclose the full details of its original contract with Plus and its subsequent amendments. This, the government has adamantly refused to do in the past.
But the time has come when this obstinacy should no longer be tolerated, as it runs contrary to Prime Minister Abdullah Ahmad Badawi's pledges of transparency and trustworthiness.
The time is therefore ripe for the people to demand that the government makes a clean breast of the Plus contract, failing which legal action must be taken.
