This latest article on the Penang Transport Master Plan (PTMP) is in response to former MBSP Councillor Joshua Woo’s letter to the editor “Public transport not profitable, government needs to pump in money”, which played down concerns of my recent findings where the Penang LRT is projected to incur a RM1.2 billion loss in ticket revenue over its first 10 years of operation.
To recap, SRS Consortium forecast a highly exaggerated annual ridership of 42 million trips within one year after the Penang LRT is operational. This annual ridership figure of 42 million trips is significantly higher than most MRT lines in London, Singapore and Kuala Lumpur on a per capita basis.
The projected RM1.2 billion shortfall in revenue over 10 years (or RM120 million of losses per year) for the Penang LRT was estimated by scaling down the annual ridership forecast from 42 million trips to a more achievable target of 10 million trips.
Woo’s recent article attempted to justify this projected shortfall in revenue (RM120 million per year) for the Penang LRT by comparing it with the financial losses incurred by other global cities as a result of subsidising public transport. Some examples used by Woo included:
- The Curitiba’s Bus Rapid Transit (BRT) system which accumulated an RM1.3 billion financial loss over seven years (or RM186 million of losses per year)
- Singapore’s public transport system which the government subsidises as much as RM12 billion each year, and
- London’s public transport network which has an annual grant of about RM3.7 billion.
While it is useful to conduct a comparative assessment of other public transport networks around the world, such comparisons on an absolute scale are fundamentally flawed. Firstly, the population of Curitiba (2.05 million), Singapore (5.6 million) and London (8.5 million) are significantly higher than that of Penang Island (with only around 780,000 people).
Secondly, the gross domestic product (GDP) of Curitiba (US$32.9 billion), Singapore (US$296.8 billion) and London (US$600 billion) are again significantly higher than Penang (approximately US$16.9 billion). This justifies their financial sustainability of allocating more subsidies towards public transport or incurring a larger financial loss on absolute terms.
Thirdly and most importantly, the public transport subsidies and financial losses quoted by Woo for Curitiba, Singapore and London are for the entire public transport network. For example, London has 12 Underground lines and its local bus network is one of the largest and most comprehensive in the world with over 700 different routes, while Singapore has five MRT lines and more than 300 different bus routes.
On the other hand, Penang’s projected shortfall in revenue of RM120 million per year is only for one LRT line and not the entire public transport network. It is also worth noting that the estimated annual loss of RM120 million for the Penang LRT line will be approximately 20% of the state’s revenue, given that the estimated revenue for the Penang state budget in 2018 is around RM500 million.
Therefore, can Penang really afford this LRT system? Given that modern trams and BRTs are shown to be cheaper to build, operate and maintain, how did the Penang government arrive at the conclusion to build LRTs over BRTs and modern trams? Have comparative studies been conducted in a scientific and quantitative manner?
Modern trams not chosen because of flash floods
While it is acknowledged that Penang Chief Minister Chow Kon Yeow recently explained that LRT is selected ahead of modern trams due to the concern of flash floods in Penang, such arguments are highly ludicrous and are illogical.
Is the Penang chief minister implying that Penangites should brace for more flash floods in the foreseeable future? If so, has the state government given up on its flood mitigation efforts which were previously promised to Penangites? Shouldn’t the Penang government be addressing the source of flooding and remove the causes?
In addition, by comparing the figures quoted in the SRS proposal and the Halcrow Report, it is shown that the “construction cost per km” for modern trams (at grade) is approximately 75% cheaper than an LRT system.
Hence, instead of choosing the most expensive LRT option costing RM8 billion, why not use the funds more efficiently by selecting a cheaper public transport system (modern trams and BRTs) and re-allocate the remaining funds for flood mitigation projects?
Critical question not answered
Regardless, the general public is still waiting for Woo, the Penang government or SRS Consortium to provide more clarification on the ridiculous ridership forecast for the Penang LRT.
Does the 42 million ridership forecast for the Penang LRT within its first year of operations not seem ridiculous to Woo?
For a comparison, Kuala Lumpur has a population of 1.73 million in 2016, yet the new Sungai Buloh-Kajang (SBK) MRT Line only managed to record an actual ridership of 22.25 million within its first year of operations.
Even Transport Minister Anthony Loke had highlighted that the LRT might not be the best option for Penang.
By persistently defending the SRS-proposed PTMP, it clearly shows that the Penang government has very early on aligned itself with SRS Consortium.
Given that no agreement between the state government and SRS Consortium has been signed, why are Woo (currently the strategic communications manager for the Penang DAP) and the Penang government not adopting a neutral stance by addressing these concerns raised by civil society as we would expect from a government?
Roger Teoh is a PhD postgraduate studying at the Centre for Transport Studies, Imperial College London. The opinion of the author is expressed from a neutral standpoint and he is not a member or affiliate of any political party or NGOs in Malaysia.
The views expressed are those of the writer and do not necessarily reflect those of FMT.