I CAN’T help but smile when an MCA man took aim at a DAP representative when the latter credited the Pakatan Harapan (PH) administration for saving more than RM8 billion on the MRT2 (Putrajaya Line) project. The former said it was actually “scope omissions and specification reductions”.

Obviously, they have not really appreciated and understood the whole project.

Let us go back and look at some numbers on the overall project.

In 2010, former prime minister Najib Razak announced that the government was considering a RM36 billion Klang Valley MRT proposal (three lines) from Gamuda Bhd and MMC Corporation Bhd.

In 2012, MRT Corp said that the project cost for the Sungai Buloh-Kajang (SBK) Line would not exceed the limit of RM23 billion.

The SBK Line was expected to have a daily ridership of 442,000 on the opening year. A target of 250,000 daily passengers is required for the line to break even on its operation costs.

However, maximum ridership was in 2019 with only about 64 million, giving an average of 175,000 per day while the LRT Kelana Jaya Line carried about 95 million passengers in the same year. MRT Corp blamed that people were still buying cars, even during the pandemic.

It was touted as a game changer and facilitating underserved areas. Affordable fares would help the lower and medium income groups and would be relatively cheaper than driving.

Today, the first phase of the Putrajaya Line is operational. The government allocated RM23 billion in the 2015 Budget and awarded the contract in February 2014 to MMC-Gamuda under a PDP structure at RM28 billion.

The construction cost then shot to over RM39 billion. Overall cost ballooned to RM57 billion including land and other costs due to line extensions to Bandar Malaysia, scope changes and ringgit depreciation. Construction cost was reduced to about RM30 billion by building the project progressively, rationalising the allocation of reimbursables, contingencies and provisional sums.

The third or Circle Line was approved at a cost of around RM39 billion (including land acquisition) or RM784 million/km.

The Finance Ministry (MOF) has committed up to RM50 billion in financing, including RM11 billion interest and other costs on a hybrid financing model.

MRT Corp’s official numbers showed, the cost of SBK Line at RM21 billion and the Putrajaya line at RM31 billion, for a total of RM52 billion.

Given the above, we do not know the real total costs for the two projects.

The public will enjoy free rides for services operated by Rapid KL and KTM Komuter for a month and may be extended. It will cost RM155 million to subsidise the free rides.

Perusing the audited accounts of MRT Corp as at December 31, 2021, accumulated losses was RM56.7 billion and contribution from the government was at RM57.3 billion.

Rapid Rail Sdn Bhd is the operator of the MRT lines and a subsidiary of Prasarana Malaysia Bhd (Prasarana). As at end-2019, Prasarana had accumulated losses of RM42 billion, total liabilities of RM35 billion and total assets of only RM1.3 billion.

I suggest that the government to be more prudent in unnecessarily spending RM155 million when the above two companies are bleeding and the overall costs for the three MRT lines will definitely be more than RM100 billion.

In the meantime, severely affected residents along the SBK Line are being ignored. ERE Consulting Group Sdn Bhd, who conducted a study on the environmental impact of the project, said that Taman Tun Dr Ismail is a “critical area” with 41 lots up for acquisition but the goalpost was moved.

We have heard a lot about unreliable services, first-mile last-mile meagre connectivity and poor integration between different modes of services.

On the other hand, three highway projects have obtained approval in principle from the government.

I would also suggest that the government do not lose sight of the objective of alleviating the severe traffic congestion in the Klang Valley and I don’t think we need a new committee for that.

Lastly, please share the real total costs for the project and who picked up the tab for costs other than the construction cost so that the credit and debit will tally and take necessary actions to control costs and put a smile back on people’s faces. 

What say you… – June 22, 2022.

* Saleh Mohammed reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.