KUALA LUMPUR, July 10 — There is no issue that Mass Rapid Transit Corporation Sdn Bhd (MRT Corp) is unsustainable following the increase in infrastructure costs reported in the Auditor-General's Report (LKAN), said Transport Minister Anthony Loke.
He said there was no issue of MRT Corp being unable to repay its debts, as the company is a government-linked company.
"The debt liability in terms of construction costs is guaranteed by the government, paid by the ministry and ensured by the Finance Ministry so that there is continuous repayment. So, there is no issue that 'it is not sustainable'.
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Transport Minister Anthony Loke speaks at the press conference on the new material terms of the Operating Agreement between Malaysia Airport Holdings Bhd and the government, in Putrajaya, on February 9, 2023. — Picture by BERNAMA[/caption]
“I do not foresee what it means by mismanagement because what is accumulated is the construction cost, and if we look at it in terms of operational sustainability, it cannot be recovered, but what we have to remember is that MRT is a government project," Loke said during a press conference in Parliament today.
He added that the LKAN must be looked at from various angles instead of simply claiming that MRT Corp is unsustainable since, as the government's development capital fund expenditure, it will take a long time to register earnings.
"From a financial point of view, it is quite difficult for the government to get back what has already been spent because the collection from our fares is quite low due to the relatively low fare rate," Loke said.
Infrastructure construction generates economic growth and urban area growth, ensures good connectivity between places, and facilitates people's movement.
The government still intends to implement the MRT3 project as it is necessary to complete the metro rail network in the Klang Valley, with more users expected on the MRT3 route.
"The government will also focus funds to improve first and last-class connectivity within these two years," he said.
Asked if there was a proposal to raise public transport fares, the minister said that for now the government has no intention of re-examining fares even though they had not been raised in the past 10 years.
While winding up the LKAN's proposal in the Dewan Rakyat today, Deputy Finance Minister Lim Hui Ying said that MRT Corp receives financial contributions from the government to fulfil its purpose as a company established specifically to build urban rail infrastructure and its own assets.
"The 'loss' mentioned in the LKAN is the cost that had been spent on the construction of the MRT1 and MRT2 infrastructure.
"The cost had been audited by the company’s external auditor every year, and it was found that this was not due to mismanagement by the company's management," Loke said.
He added that the number of daily passengers on the MRT1 route has reached 250,000 to 270,000 passengers a day, which is a 20 per cent increase from the passenger rate before the Covid-19 pandemic.
— Bernama
