6 theSun | WEDNESDAY JANUARY 7 2009

news without borders

GEORGE TOWN: Chief Minister Lim Guan

Eng says the federal government should
buy over the country’s major highways
that have been privatised to give taxpay-
ers a fairer deal.
He said the government could easily
afford to buy infrastructure links like the
North-South Expressway and the Penang
Bridge, to give it control over toll charges
and to prevent concessionaires benefit-
Buy over tolled highways, government urged
ing from hefty compensation claims.
He said private firms have over the
years amassed RM63.5 billion in revenue
including compensation worth RM38 bil-
lion by holding concessions over roads.
Lim pointed out as an example that
the NSE has been valued at RM8.8 billion.
“The government can easily afford this
amount and get the money back through
tolls,” he said. “It is better for the govern-
ment to earn from toll payments than for
one company to ... and that company
does not even have to pay tax.”
He said this at a press conference
called to criticise the concession agree-
ment for the Penang Bridge between
Mekar Idaman Sdn Bhd and the federal
government which allows the company
to obtain compensation if the govern-
ment terminates the agreement.
But the pact, which ends on May 31,
2018, makes no reference to compensation
payable to the government if Mekar Idaman
chooses to terminate, Lim noted.

NCCC proposes
passwords for
credit card swipes
by Hemananthani Sivanantham
newsdesk@thesundaily.com
PETALING JAYA: The National Consumer
Complaints Centre (NCCC) wants the use
of passwords to enable credit card swipes
at petrol stations.
NCCC chief executive Muhammad
Sha’ani Abdullah said payments without
authentication “encourage fraudulent
transactions” which can cost credit card
users dearly.
“In 2007, the NCCC received 809 com-
plaints against financial services institutions.
About 20% of these involved lost credit
cards and almost every complaint states
that there have been unauthorised transac-
tions at petrol stations. In 2008, the number
of cases increased,” he said.
“Over the counter transactions are okay
because there are signature verifications.
However at a petrol station, there is no form
of verification.”
Apart from credit card transactions
at petrol stations, Muhammad said the
NCCC also urges Bank Negara to draw up
regulations for online and over-the-phone
transactions.
“We feel Bank Negara should institute
guidelines so that consumers are protected
from unscrupulous parties. The NCCC also
feels that merchants who prefer credit card
payments and third party use of credit card
merchant transaction facilities should be
closely monitored by financial institutions.
Banks should be more responsible, instead
of blaming the problem solely on third par-
ties,” he said.
Apart from monitoring merchants, Mu-
hammad suggested that there be criminal
investigations into merchants involved in the
fraudulent use of merchant facilities in order
to help reduce the incidence of fraud.
“The NCCC has drafted a proposal with
suggestions for better financial security for
consumers, which we will submit to Bank
Negara this week,” he said.
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Review unfair toll pacts: TI-M
by S. Tamarai Chelvi
newsdesk@thesundaily.com
PETALING JAYA: Transparency International
Malaysia (TI-M) wants all unfair toll agreements
and those involving profiteering to be reviewed
in the interest of the public.
TI-M president Tan Sri Ramon Navaratnam
said it is only proper to review agreements that
enable toll concessionaires to reap excessive
profits.
“Otherwise, the whole policy and practice
of privatisation will be even more seriously
questioned (and) rejected by a more enlightened
public,” he told theSun in a telephone interview.
“If both parties mutually agreed to
make public the agreements, despite
the law, then who will be objecting?”
Navaratnam asked, adding the public had the right
to demand information as taxpayers.
On Works Minister Datuk Mohd
Zin Mohamed’s statement the ministry was
seeking the attorney-general’s advice as making
copies of concession agreements available to
third parties had to be done in accordance with
provisions of the agreements, he agreed that Zin
was following procedure.
However, Navaratnam added that “if it is
mutually agreed and consent is mutual, the
Cheaper to expropriate LDP, says Pua
by Karen Arukesamy and Tan Yi Liang
newsdesk@thesundaily.com
KUALA LUMPUR: The government has very strong
reason to expropriate the Damansara-Puchong
highway toll concession as it is paying higher
compensation than the cost of expropriation, said
Petaling Jaya Utara MP Tony Pua.
He explained that as at end of last year, the
government had paid about RM630 million in com-
pensation to the concessionaire, Lingkaran Trans
Kota Sdn Bhd (Litrak).
“It does not include the toll revenue that (Litrak)
is collecting,” said Pua, who came for a second
time with Serdang MP Teo Nie Ching and Kg Tunku
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documents can be released notwithstanding
the narrow legality”.
Asked whether the documents should be
made available online, he replied: “Why not?”
All documents, Navaratnam said, should be
open and transparent except those deemed
to be of a serious nature in order to maintain
security.
“Hence, most documents should be made
assemblyman Lau Weng San, to study the PLUS
Highway concessions which were made public
late afternoon yesterday.
He said if the compensations are added up, the
amount would be way higher than the amount it
would cost to buy back the concession since the
expropriation cost only requires the government to
pay the value of construction works and any inter-
est for loans by shareholders of the concession.
Works Minister Datuk Mohd Zin Mohamed had
yesterday dismissed the call for the government to
take over toll concessions, saying the government
“was not looking at the option at the moment”.
Refuting Mohd Zin, who said there has not
been any proposal from the concessionaires to
sell them, Pua said: “There is no need for the
government to wait for a proposal since it will
only happen if the concessionaire is not making
any money.”
“Why should anyone who is making profit ask
the government to take over the concession,” he
told a press conference.
On the Linkedua toll concession, signed be-
tween the government and United Engineers (M)
Bhd (UEM) on July 27, 1993, for a 30-year conces-
sion period, Pua said the original contract is “fairly
okay” and “no controversial clause”.
Its expropriation cost is the value of construc-
tion works and the interests for loans by share-
holders, however it was extended for another 15
years to 2038, he said.
“The contract was amended in 2000 and a sec-
ond supplementary agreement was signed, which
made major changes to the Linkedua arrange-
ment,” he stressed. ”It has a very interesting toll
review clause. The more traffic there is, the faster
the toll rates would increase,” Pua revealed.
public in the interest of transparency and integ-
rity of the government,” he added.
Navaratnam said transparency and faith in
good governance would then be enhanced in the
tender process or the awarding of contracts.
“We are consumers, we have the right to the
information. We are glad that the government
has finally agreed to make public the documents
in a transparent manner.”
He said Transparency
International Malaysia was also working on
a proposed Freedom of Information Act to
enhance public confidence in government,
leadership and management.
“The public’s demand for more informa-
tion is a right that must be satisfied.”
Federation Of Malaysian Consumers
Association vice-president K. Koris Atan
said a toll agreement “is a public document
and is meant for the public”.
He said there should be no restrictions
to viewing the document when it should be
made available in the National Library or for
the press to publish.
Koris suggested that the documents be
made available on the Public Works Depart-
ment website for easy public access.
“Consumers are paying toll and they
have the right to know (the contents).”
“If every year on average the traffic increased
by 2% the toll rate would increase by 10.4% and if
every year the traffic increased by 5%, the toll rate
would increase by 26.5%,” Pua explained, adding
that toll rates are reviewed every five years.
Pua said usually when there is a higher traf-
fic volume, the toll rates would be reduced, but
this is otherwise, again being favourable to the
concessionaire.
“As of how lucrative the Linkedua is, the total
projected toll revenue from 2000-2038 is RM13.69
billion while the cost of construction of this toll, if
I’m not mistaken is only RM1.03 billion – 13 times
more revenue,” he said.
He said that the yearly estimated maintenance
is RM10 million.
Lau, who scrutinised the SMART Tunnel con-
cession, discovered an additional RM1.2 billion.
“I compared this with an announcement made
by the government on June 2, 2004, saying that
the total construction cost is RM1.933 billion and
the cost borne by the government was RM1.312
billion, and this was reflected in the concession
agreement,” he said.
“But, in the agreement, there is an additional
RM1.225 billion where the government released
the money by a letter of guarantor to the bank to
issue the loan,” said Lau.
“When there is a loss, the government has to
compensate the concessionaire. But what if there
is an excess of revenue? The government only
gets 40% of the revenue while the concessionaire
gets the balance,” he said.
“It is a very lopsided agreement as when the
company suffers a loss, the government has to
pay in full, but when there’s a profit, the govern-
ment gets less than half,” he pointed out.

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