GEORGE TOWN: The open feud between the Penang government and Syarikat Prasarana Negara Bhd (Prasarana) over the state’s proposal for free peak-hour services by the latter’s Rapid Penang bus service seems to be reaching a conciliatory end.

A letter viewed by fz.com from Prasarana group managing director Datuk Shahril Mokhtar to Chief Minister Lim Guan Eng last Friday seems to have put matters into perspective — that Prasarana never rejected the proposal and Lim may have jumped the gun by quoting an inaccurate news report that the transport company had declined the RM10 million a year offer to provide free rides.

The letter sheds light on negotiations between Chow Kon Yeow — the state executive councillor for Local Government, Traffic Management and Flood Mitigation — and Prasarana officials.

Prasarana had never said “no” to the proposal — it merely said it cannot do it for RM10 million. fz.com was given to understand that Prasarana makes about RM20 million annually during peak hours on both the island and mainland, and is open to accepting the offer but on shorter hours.

In an Oct 10 correspondence between the state and Prasarana, the latter had referred to an Oct 8 request from Chow for information on Rapid Penang’s annual revenue during peak hours and its operating costs.

The two-page letter sent by Prasarana, meanwhile, was a reminder that negotiations have not been exhausted.

Chow, when contacted yesterday, said discussions are ongoing towards an amicable agreement on how the system can be implemented, in view of cost restraints cited by Prasarana.

“We are working on it,” he said when contacted.

Chow confirmed he led the state government’s meetings with Rapid Penang to work out expenditure issues, including how to reduce the bus company’s operating costs, and determining the number of buses to be involved.

Prasarana, a federal government owned public infrastructure company which comes directly under the finance ministry, runs the Rapid Penang service.

In 2011, the Penang government offered a RM10 million annual grant to provide free bus rides throughout the state during peak hours — from 6am to 9am and from 4.30pm to 8.30pm — every week-day.

The state said a verbal agreement was reached during a meeting in Kuala Lumpur but it was never implemented despite follow-ups done in writing.

On Oct 13, Lim issued a statement that Prasarana could reduce its RM763 million losses in 2011 by accepting the RM10 million annually offered by the state government.

That same day, Shahril said accepting the grant would worsen the government-linked company’s financial position, but did not state the losses that would be incurred if the offer was accepted.

“Lim should not manipulate this matter. We had an open discussion with the state government officials and are still awaiting the response from them,” he said.

He stressed that Prasarana was open for discussion in the interest of enhancing the delivery of public transport services to Penangites.

But Lim quoted an inaccurate online report that Prasarana had rejected the state’s offer.

Shahril added: “The state government must demonstrate its sincerity and earnestness in addressing the plight of the people as traffic congestion worsens in the state.”

This caused an angry retort from Lim who questioned the rationale of a “profit obsessed” Prasarana which despite its losses, could still in 2011 pay 1.5 months to two months’ bonuses to its staff. This, noted Lim, was higher than the one-month bonus received by ordinary government civil servants.

On Oct 16, Shahril took the exchange on Twitter, by sarcastically referring to Lim as a “smart fellow” in this tweet: “Daily sales for selling chendol during peak hrs generates RM500 but 1 smart fellow suggests give free chendol same hrs & he wld give RM300.”.

Lim retorted in a statement that Shahril “should not rely on insults in his tweets to evade explaining Prasarana’s business model, evading its statutory duty of providing efficient public transport”.

Lim also lamented that because public transport is controlled by the Barisan Nasional federal government, the state government cannot operate a public transport service on its own turf.

Shahril later apologised on twitter: “YAB.. my apology.. btw in my tweet I was the Chendol Seller and u r right, Chendol Seller is a very reputable occupation.”

On Saturday, he sent two more upbeat, conciliatory tweets: “I have even wrote to YAB (Lim) today to clarify d matter” and “Lets work 2gether for d Penangites.”

For more stories, go to www.fz.com, the website for freedom of expression and fairness in articulation.

This article first appeared in The Edge Financial Daily, on October 22, 2013.