The government is bearing over RM500 million in costs this year to maintain toll rates on 10 major highways and provide festive discounts.

PONTIAN: The government is bearing financial implications of over RM500 million to maintain the existing toll rates on 10 major highways this year

Deputy Works Minister Datuk Seri Dr Ahmad Maslan said this amount needs to be paid to 10 concession companies following the government’s decision made last December.

“Everything, such as the absence of toll hikes or with toll discounts during the festive seasons, is not free but is borne by the government to the toll concessionaires according to the concession agreements that were signed previously,” he said in an interview with Bernama today

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In the meantime, Ahmad said the government also bears a financial implication of around RM80 million per year to compensate all toll highway concessionaires following the 50 per cent toll discount given to the people during festive seasons.

He said that the amount needs to be paid to 33 highway concession companies for toll discounts during the Hari Raya Aidilfitri, Chinese New Year, Deepavali and Christmas celebrations.

Clearly, the provision of discounts aims to alleviate the cost of living for the people, especially during the festive seasons when they return to their hometowns.

Meanwhile, he said the government is implementing the construction of tolled highways through the privatisation method due to financial constraints in covering all infrastructure projects using the annual development allocation.

He said that through this method, concessionaires need to obtain financing from banks to cover the construction costs of the highway project, which amounts to billions of ringgit.

“When the project is privatised, the related company has to borrow from the bank to finance the billion-ringgit project, and the way to recover the payment is through toll collection,” he said.

He also said that the toll collection is subject to the rates agreed upon in the concession agreement signed for a certain period.

“During the signed period, the toll rate was supposed to be increased. However, the government is concerned and does not want to raise the rate because it considers the people’s livelihood,” he added.

 The Sun Malaysia