CONGESTION charges for the four highways that Putrajaya is set to take over from Gamuda Bhd will be lower than the current rates set by the concessionaire, said Finance Minister Lim Guan Eng.

The concession period for the Damansara-Puchong highway (LDP), Smart tunnel, Shah Alam highway (Kesas) and Sistem Penyuraian Trafik KL Barat (Smart) ranges between nine and 23 years. 

“All consumers will have to pay toll rates according to the concession contract. However, when it is taken over by the government, they can pay a congestion charge which is far lower than what they’re paying now,” he said in the Dewan Rakyat today during question time.

“We want to make sure the government can save RM5.3 billion while consumers can save some RM2 billion on toll charges paid during the concession period.”

Lim said the takeover will be funded by bond issuance. 

The bonds are based on the advice of an eponymous investment bank which guarantees that the move will allow Putrajaya to fund the takeover without having to fork out anything, he said.

The congestion charges will be used to pay off the debt. 

“We have been successful in reducing the toll rates to congestion charge because the government is not here to make a profit.

“Why didn’t the previous government do that, instead they were enriching a private company?”

The government proposed to take over the four tolled roads at RM6.2 billion from Gamuda Bhd.

Lim reiterated that the deal would save taxpayers RM5.3 billion, which would otherwise be used to compensate toll operators.

Although the proposal has been accepted by the highway concessionaires, it is still subject to the approval of the cabinet. 

The cabinet, he said, gave its in-principle approval on February 27, while Prime Minister Dr Mahathir Mohamad approved the conditional offer on June 20.

“We derive value. We are giving it as a public good where they (the people) will get a return.

“This goes to show that if the former government had indeed cared for the people, they would have used this formula to reduce the burden of the people and not let private companies profit beyond their limits.” – July 9, 2019.