COMMENT | No free lunch in RM5.48b toll road purchase

COMMENT | Value cannot be created out of thin air. It has to come from somewhere. So it is impossible to have everyone winners in a deal which cancels a schedule of promised toll increases, promises no future toll increases and puts the government under no further obligation as far as toll compensations and debts are concerned.

Too good to be true, right? Indeed, it is.

The government expects to save RM4.3 billion in toll compensations over the takeover of four key toll roads in Kuala Lumpur for RM5.48 billion of which the main shareholder is listed infrastructure conglomerate Gamuda. But someone will pay for this RM4.3 billion.

It’s being billed as a win-win-win deal for all three parties - the shareholders of the concession, mainly Gamuda, the government and the toll-paying rakyat.

But simple arithmetic dictates that all three cannot win because someone has to pay for that RM4.3 billion - it can’t disappear into thin air. Although the key players in this sad saga, which includes the non-profit Amanat Lebuhraya Rakyat or ALR which will take over the concessions, continue to downplay it, the loser is - no surprises here - the rakyat.

The payoff for the RM4.3 billion comes through the extension of the concession periods of the three main roads for a period of between five and 10 years - instead of toll increase, the period for payment is increased, still burdening the rakyat.

Based on current projections, the deal perpetrators must have exact figures for how many years precisely the concessions will be extended but they are not saying anything yet. Strange, but I suppose they prefer to keep this most important part of the deal as quiet as...