I refer to the answer given to me by the Transport Ministry in Parliament on 10 June 2014 and the press report on the statement by Public Accounts Committee chairman Datuk Nur Jazlan on the additional RM100 million spent to build a two kilometres rail linking KLIA and klia2 (cf. http://www.themalaysianinsider.com/malaysia/article/why-the-rm100-million-price-tag-for-a-1km-line-extension-at-klia-asks-publi).
PAC has pointed out that the RM100 million was an additional cost borne by Putrajaya when it should have been costed into the original cost to build klia2 by Malaysia Airports Holdings Bhd (MAHB), a government-linked corporation. The original cost itself has doubled from RM 2 billion to RM4 billion.
When I asked the question on why the additional cost of RM100 million was paid for by additional taxpayers’ money, when it should have been accounted for in the original cost, Deputy Transport Minister Datuk Abdul Aziz Kaprawi instead of answering my question dodged it by saying the government was building a public amenity for the people.
While I do not question the need for such public amenity to be built, I have to raise two issues on using RM100 million of taxpayers’ money to build this rail line extension:
1) RM100 million: Oversight or overspending?
Under the item, “aset-aset kerajaan” (government assets), MAHB has allocated RM582 million to build government facilities such as a new control tower (RM174 million), and roads for public access (RM294 million). The balance of RM114 million was spent on consultants and miscellaneous costs.
Why was the two kilometres rail line not costed into the RM582 million for public amenities? Is it due to bad planning or overspending that Putrajaya has to fork out an additional RM100 million to foot the bill?
2) Why should taxpayers foot the bill for concessionaire’s asset expansion?
The second and more important issue, the rail line is to be the extension of the KLIA Express run by Express Rail Link (ERL) Sdn. Bhd. Although built by the government, passengers using this line from KLIA to klia2 will still have to pay RM2 on top of the RM35 to travel from KL Sentral to KLIA.
ERL Sdn. Bhd. is the company awarded a 30-year concession agreement in 1997, with an option to extend for another 30 years, to finance, construct and operate the high-speed rail between KL and KLIA.
With the rail line extension to klia2, who will be reaping the profit? The answer is obvious, ERL Sdn. Bhd. CEO Noormah Mohd. Noor had said that the new line will increase its ridership by 40%.
(http://www.ytlcommunity.com/commnews/shownews.asp?newsid=61045&category=)
And on top of that ERL Sdn. Bhd. will be collecting an additional ridership fee.
This is akin to socialising the cost and privatising the profit of this project.
Why is the government helping ERL Sdn. Bhd. on its asset expansion using taxpayers’ money?
ERL Sdn. Bhd. is jointly owned by YTL Corporation Bhd. (50%), Lembaga Tabung Haji (40%) and Trisilco Equity Sdn. Bhd. (10%).
The PAC must do more and the Auditor General must audit the klia2 project
While I applaud the PAC under the leadership of Datuk Nur Jazlan for highlighting the discrepancy in spending the extra RM100 million, I urge the PAC to do more, including to summon the Minister involved to appear before the committee and give a thorough report including why taxpayers’ money are being used to fund private concessionaire’s asset expansion.
I also call upon the Auditor General to audit this project which is obviously problematic on many grounds but notably, for using tax money to help a private company expand their asset and increase their profit.