This article first appeared in The Edge Financial Daily on January 24, 2020

KUALA LUMPUR: There will be direct savings of RM1.1 billion this year alone for the relevant parties in the 18% reduction in toll charges on PLUS-owned highways, Finance Minister Lim Guan Eng said yesterday.

This includes RM500 million in savings for highway users from the 18% discount, and RM600 million from the government’s compensation to freeze toll rate increases.

“The compensation of RM600 million will no longer be used for the benefit of highway users and concessionaires, and instead can be channelled to charity and economic development projects across the country,” Guan Eng said in a statement today.

Guan Eng said the Cabinet had, at its meeting yesterday, endorsed the decision to restructure PLUS Malaysia Bhd based on the proposal submitted by its shareholders, namely Khazanah Nasional Bhd and Employees Provident Fund (EPF).

The Cabinet also instructed that an emergency meeting be held among stakeholders on the same day, to ensure that the government’s decision on the restructure can be implemented smoothly and properly according to the timeline that had been fixed.

The meeting was chaired by Guan Eng and attended by Communications and Multimedia Minister Gobind Singh Deo, Treasury secretary-general Tan Sri Ahmad Badri Mohd Zahir, Works Ministry deputy secretary-general Datuk Badrul Hisham Mohd, Malaysian Highway Authority director-general Datuk Mohd Shuhaimi Hassan, Khazanah managing director Datuk Shahril Ridza Ridzuan and EPF chief executive officer Tunku Alizakri Raja Muhammad Alias.

Guan Eng said the meeting confirmed Feb 1 as the implementation date for the toll reduction as announced earlier by Prime Minister Tun Dr Mahathir Mohamad.

On Jan 17, the Prime Minister’s Office announced that there will be no toll rate hikes on PLUS highways as the concessions will be extended for 20 years from 2038 to 2058, which would provide the government with RM42 billion in savings.

It also announced an 18% reduction in toll charges for private vehicles plying PLUS highways, and that Khazanah and EPF will remain as the shareholders of PLUS.