JOHOR BARU: The public-private partnership model proposed for the elevated autonomous rapid transit (E-ART) project in Johor carries significant risks, including the possibility of high fares and delays, says Datuk Seri Dr Wee Ka Siong.
The MCA president said under this model, the private sector would finance and operate the project before recovering investments through fares or other mechanisms negotiated with the government.
“This is where the risk lies. Negotiations can fail if both parties cannot agree on terms involving costs, concession periods, subsidies, revenue guarantees and fare rates.
“Johoreans are concerned that fares could become too expensive as private companies would ultimately seek to recover investments and generate profits,” he said on Wednesday (May 20).
Dr Wee questioned why only a letter of intent (LOI) had been issued by the Public-Private Partnership Unit (Ukas) to the E-ART consortium earlier this month when the Rapid Transit (RTS) Link is set to begin operations in another seven months.
“A LOI from Ukas does not mean the project is confirmed – it is not a letter to start work nor is it a final contract; it is merely a document expressing the intention to begin negotiations on commercial terms with the concessionaire,” he said.
He said the Madani government should either directly fund the project, similar to the Penang light rail transit (LRT), or retain a majority stake in the concession company to better control fares, implementation and safeguard the people’s welfare.
“Until all these matters are made clear, do not confuse the people of Johor with the announcement of RM10bil as if the federal government is funding the project.
