PETALING JAYA: MCA deputy president Wee Ka Siong today described the 30-year toll concession that the Penang government had awarded to the contractor of the undersea tunnel project as the “most outrageously generous toll concession contract in history”.
“The Penang government has a lot of explaining to do as to why it has awarded such an outrageously generous concession agreement that will put even Mahathir to shame.”
He was referring to former prime minister Dr Mahathir Mohamad’s time when many long-term toll concession agreements were signed in the 1980s and 1990s.
Wee, who is also a minister in the Prime Minister’s Department, said even Works Minister Fadillah Yusof had called the deal “the most generous concession agreement in the world”.
Wee criticised the Penang government for defending its decision to fully fund the construction of the tunnel, despite giving the toll concession to the same contractor.
“Under any normal concession agreement, the concession holder will borrow to fund the construction of the project and then collect tolls to repay its borrowings and make a profit.
“In the case of the Penang undersea tunnel, the concession holder will get to make construction profits and then make even more profits from collecting another 30 years’ of toll from the public,” Wee said in a statement today.
The Ayer Hitam MP also questioned the sincerity of DAP in supporting its promise to abolish all tolls.
“On one hand, Pakatan Harapan promises in its manifesto to abolish all tolls. On the other hand, the Pakatan government in Penang is awarding a 30-year toll concession in a most lop-sided concession agreement.”
Wee was referring to the RM6.3 billion tunnel-road project for Penang which has come under renewed scrutiny by BN following a fresh probe by the Malaysian Anti-Corruption Commission earlier this year.
The 7.2km undersea tunnel will connect George Town’s Pangkor Road and Bagan Ajam in Butterworth. It is scheduled to begin in 2023.
The “three main roads”, which are part of the project, stretch from Air Itam to the Tun Dr Lim Chong Eu Expressway (5.7km), Tanjung Bungah to Teluk Bahang (10.53km), and Jalan Pangkor-Gurney Drive junction to Tun Dr Lim Chong Eu Expressway (4.1km).
Wee also questioned the “generous decision” to allow the main contractor to start work on the tunnel in 2023, or 10 years after the contract was signed in 2013, but agreed to pay for this using a certain amount of land valued at RM3.6 billion today.
“Assuming a 5% per year appreciation in land value, this would mean that the RM3.6 billion worth of land today will be worth RM5.8 billion in 2023 — meaning another RM2.2 billion loss to the Penang people. The formula is very simple.”