KUALA LUMPUR, Feb 6 — The government is doing its level best to weigh the needs to protect and enhance the welfare of the people, amidst grappling with financial constraints, in arriving at its decision to reduce the toll rates by 18 per cent for PLUS Malaysia Bhd-operated highways, said economists.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said this was especially true in the face of the rising cost of living which continues to have negative implications to the real income among Malaysian households.
“Henceforth, the 18 per cent reduction in the toll rates is the step in the right direction although the direct expenditure on tolls among Malaysians, in general, is fairly low compared to, for instance, food and beverages,” he told Bernama today.
Nonetheless, he said the toll reduction should translate into lower transportation costs among the business.
“As such, it is imperative to ensure the benefits of lower transportation costs enjoyed by the businesses will be passed on to the consumers,” he said.
This, Mohd Afzanizam stressed, would require strict enforcement on the part of the government as businesses may have little incentive to pass the benefits to the consumers.
“While we may not be expecting the same quantum of reduction, at least businesses should be able to contain their transport cost and would have no reason to raise the price excessively. What we are aiming for is stability in the price level,” said Mohd Afzanizam.
Meanwhile, Universiti Malaysia Sarawak, Faculty of Economics and Business senior professor Prof Datuk Dr Shazali Abu Mansor suggests that the toll business model should not be profit-oriented as it should operate in such a way that whoever utilises the highway, the benefits would go back to the people.
“At least cover the cost (of highways)…rather than stick to the old model which emphasised on profit, the same with water and electricity charges,” he said.
“Unless we change the model to a non-profit concept and applies it to all public utilities…I think that is a very good concept, non-profit operating (model) based on covering the cost of maintenance, it would then test the effectiveness of the model,” he said.
Shazali said psychologically, the 18 per cent reduction in toll rates would not provide many benefits because the people would prefer to have more discounts.
“A little bit of profit margin is alright as the money could be utilised for other things. If the government can reduce further, the people would have more (disposable) income that can be spent on other things, because we want other factors of the economy to move also.
“The more money held by the people can be channelled elsewhere, that is more appropriate,” he said.
Shazali said profit on certain goods, for instance, telecommunication, whereby the telecommunication companies raked in billions of profit, should be looked at because all these are necessities — water, electricity, telecommunication and roads.
The government’s decision to reduce the toll rate by 18 per cent will see, for example, the toll rate on the North-South Expressway reduced from 13.6 sen per kilometre (km) to 11.15 sen per km, which is lower than the toll rate in 1999 at 11.24 sen per km.
With the new toll rates, a journey from Jalan Duta (Kuala Lumpur) to Alor Setar (Kedah) will cost road users RM45.50 compared with the previous charge of RM55.50, while from Jalan Duta to Skudai in Johor will cost RM38.50 compared with RM47 previously.
The decision toll rate was made at the Cabinet meeting on Jan 15 and the Prime Minister’s Office in a statement said that the move was also in line with the announcement made during the tabling of the 2020 Budget.
More importantly, PLUS highway users can rest assured that there will be no more increase in toll rates for the next 38 years until the concession ends in 2058.
This is because the concession period for all PLUS highways has been extended by 20 years from 2038 to 2058 to ensure that PLUS will be able to carry out its highway maintenance and operation activities without depending on the government.
— Bernama
