THE news headline reads, “A-G’s report: MRT1 accounts still not closed after seven years due to discrepancies since 2013”. I am not surprised because in 2014, I had written an article published in The Malay Mail titled “Mr Prime Minister, full review of KVMRT project required”. 

In the 2014 article, I suggested that “the Auditor General or an independent body may want to scrutinise the fees, reimbursable and ‘allowed’ contingencies provided in the contract with the project delivery partner. While at it, it would be advisable to also look at the total project cost that may have exceeded the budgeted amount”. 

In another A-G report, the 4km Johor Baru–Singapore Rapid Transit System (RTS) Link (owned and being developed by MRT Corp) project’s estimated cost had increased by 29.9% or RM1.2 billion to RM5.24 billion as of December 31, 2023. It is a railway shuttle between Johor Baru and Woodlands to alleviate congestion at immigration checkpoints for both countries. 

The reasons given for this were the impact of the Covid-19 pandemic, expansion of depot work scope, a new Traffic Diversion Scheme, the Customs, Immigration and Quarantine (CIQ) Complex, iconic facades, aesthetic flyover structures, additional land acquisition, and construction of parking facilities. 

We can understand the impact of the pandemic but surely the rest should have been considered earlier, especially the CIQ and parking facilities. And are iconic facades and aesthetic flyover a necessity when the government’s financial position is of concern? 

What is more disturbing is the 28km Mutiara Line LRT (MLL) in Penang project that costs RM10.5 billion. Initially, it was a state project, but the government expedited development with additional funding before fully taking it over. Funding was contentious as Penang was an opposition state. It resorted to the Penang South Island reclamation project for funding and estimated the sale of the islets would generate RM70 billion and the development of the islets, an economic spillover of RM100 billion. 

Critics say the MLL is ‘wasteful’ with an estimated annual loss of over RM500 million. What is needed is an autonomous rail transit that is much cheaper with greater flexibility; the LRT is too car-centric.  

I would suggest the A-G review the project papers. 

Areas to look at, among others, are ridership targets, environmental and social impact studies, budgeted reimbursables, contingency station location costs, and the feeder bus system. It should confirm whether there is any peer review. Over-optimistic ridership numbers apply to the KL MRT, LRT, and Express Rail Line too.  

The MRT was touted to be a game-changer. Yes, it created traffic jams since its construction until today. There wasn’t a clear framework to assess the productive efficiency of the MRT project versus other means of public transport as well as allocative efficiency (public transport versus other competing demands for public resources). Is there one for MLL and the KL-Singapore high-speed rail (HSR)? 

As of 2023, the government pumped over RM59 billion into MRT Corp and RM16.6 billion on the Light Rail Transit (LRT3). When everything is completed – including MRT3, RTS Link and MLL – the amount will be about RM140 billion excluding cost over-runs or close to 10% of the RM1.5 trillion debt figure! Traffic jams will still be the order of the day with concerns about last-mile connectivity. The objectives of MRT1, after eight years, have not been met and may be repeated for MRT2 as ridership forecasts are very optimistic. 

Is public transport an option or a necessity? How about other not so developed areas – will they remain as they are ten years from now? How about our much-talked-about education system that needs upgrading to produce a quality workforce for the future, and the public health system? 

And there is also the Penang undersea tunnel project. It will be designed to alleviate chronic traffic congestion, but wouldn’t it choke the island with more vehicles from the mainland? Isn’t this short-sightedness? 

In the meantime, we promote vehicle sales with more cars and narrow roads in Penang (electric vehicles given various exemptions and incentives). Contractors reap higher profits constructing the rail projects and so do housing developers, creating an affordability crisis. 

In parliament, the deputy finance minister said there are plans to ensure MRT Corp can reduce its dependency on the government. Good to hear but at a time when the government is so concerned about national debt and the tribulations of KL MRT, LRT, Monorail and ERL, it may not be a good idea to proceed with the MLL and HSR too. 

The transport minister said the MRT Corp incurred losses for positive economic impact. Were any calculations done for the MRT1 and MRT2 projects? The GDP may increase during the construction period but is it sustainable if costs cannot be recouped? 

Direct and indirect costs such as higher fuel usage, vehicle wear and tear, and unproductive time at traffic jams affect vehicle owners and productivity levels. Can we afford it? – July 18, 2024.   

* Saleh Mohammed reads The Malaysian Insight.  

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.