Govt has right to determine airport charges, Loke tells critics

Transport Minister Loke Siew Fook says both MAHB and Mavcom are government-linked entities.

RAWANG: The government has the right to determine the rates of the passenger service charges (PSC) as it owns the airports, said Transport Minister Loke Siew Fook.

Loke pointed out that Malaysia Airports Holdings Bhd (MAHB) is the operator and the Malaysian Aviation Commission (Mavcom) is the regulator, and both are government-linked entities.

“All assets are owned by the government. The PSC rates is a Cabinet decision, not that of the transport ministry.

“We are not undermining anybody,” he told reporters after the launch of the Klang Valley Double Track Phase 2 (KVDT2) in Serendah here today.

He also said that the lower PSC charges would not affect MAHB earnings.

“This is good news for everyone as we have agreed to lower the charges, which we believe will stimulate the tourism industry,” Loke said.

Last Friday, the government announced that the PSC for international flights would be reduced from RM73 to RM50 at all airports in Malaysia, except for the KL International Airport (KLIA), effective Oct 1.

The PSC for Asean flights remains at RM35 and for domestic flights at RM11.

International Air Transport Association (IATA) yesterday said the decision by the government to intervene and lower the PSC charges has undermined Mavcom’s credibility and would put KLIA on the losing side compared with other airports.

“The government has also undermined Mavcom’s credibility as a result. Mavcom is the appointed economic regulator for airports and has the mandate and authority to determine airport charges.

“There is an established process for setting airport charges,” IATA’s regional vice-president for Asia-Pacific Conrad Clifford was quoted as saying.

On the second phase of the KVDT2 project, which resumes today at a 15% lower cost of RM4.475 billion, Loke said the project is expected to be completed in seven years.

The KVDT2 involves the rehabilitation of 265km of KTM Bhd’s railway tracks, stretching from Salak South to Seremban and from Simpang Port Klang near Mid Valley to Port Klang.

Loke emphasised that the reduction from the original price tag of RM5.265 billion would not jeopardise the quality of the work and no jobs would be affected.

“However, several job scopes that are not important have been reduced, including the upgrading of 10 stations along the route, and will be taken over by Perbadanan Aset Keretapi.

“The government also takes note that several locations along the KVDT2 route experience frequent flooding, which is a contributor to derailment.

“This upgrade is therefore aimed at enhancing the quality and safety of train services, especially the KTM Komuter and Electric Train Service,” he explained.

Loke said the track upgrading would not affect the frequency of ETS and KTM Komuter services.

About 20-30% of the preparatory works for the KVDT2 are already completed, and the work would be done over 60 sequential stages to ensure minimal disruption to KTMB operations.

The scope of work for the KVDT2 includes replacing the 25-year-old tracks with new foundations and tracks; and upgrading and maintenance of the electrification system, communications and stations.