Frequently Asked Questions (FAQ)
- Why doesn’t the government build its own highways, instead of getting private concessionaires who then impose toll charges on road users?
With private concessionaires taking over the development of highways and their management, the Government gets to channel its funds into other public facilities such as schools and hospitals. Private highway concessionaires have invested millions into developing state-of-the-art, modern highways equipped with world class facilities to ensure road users travel safely and save time. For more info, please read our explanation on privatisation (link) and toll rates (link).
- Why are road users required to pay toll?
Private highway concessionaires have spent millions on highway development and facilities, and over time need to recoup their heavy investments, just like in any business. Highway concessionaires implement the “user pay” concept, which hinges on the notion that those who use the highway should pay for it. Besides that, highway concessionaires are also required to pay taxes and dividends to the Government, as well as share the toll collections with the Government. All this requires financial capacity, and so toll collections from the road users help the concessionaires fund these expenses. For more info, please read our explanation toll rates (link).
- Why does the concession agreement cover such a long period?
There are plenty of issues involved in the development of highways which requires a lengthy period. Projek Lebuhraya Utara – Selatan Sdn Bhd (PLUS), for instance, undertook the development of the North – South highway, which stretches 823 kilometres in length. Such big projects require a lengthy concession period in order for concessionaires to meet all the necessary requirements, including the development of highway facilities. For more info, please read our explanation toll rates (link).
- Why are the roads still congested even with toll collection?
The number of vehicles has increased tremendously in Malaysia over the last two decades. Tolled roads do help ease congestion during the peak hours, but with everyone on the road at the same time, it is impossible to avoid traffic during these hours. The Ampang – Kuala Lumpur Elevated Highway (AKLEH), for example, is an alternative route to avoid congestion in Jalan Ampang, which has stemmed from rapid development in the Ampang and Melawati area. For more info, please read our explanation traffic management (link).
- Why pay toll when there are no alternative routes?
There are two highways which do not offer an alternative route – the Damansara – Puchong Expressway (LDP) and Grand Saga. In the case of LDP, the highway was developed to connect Bandar Sri Damansara which saves time for road users who had previously used Kepong to get there. Besides that, 80 per cent of LDP users also do not have to pay toll. It is also worth noting that highway concessionaires have invested heavily to upgrade existing highways, including building tunnels and bridges as well as an integrated traffic system. For more info, please read our explanation alternative routes (link).
- Toll charges increases the cost of living.
This is not entirely true. In fact, because toll highways allow road users to get to their destination in an efficient, quicker and safer manner, their cost of transportation will also lessen. Tolled roads also help to save costs when one takes into account the wear and tear of vehicles, fuel consumption and distance of travel. For more info, please read our explanation on Business of Toll Operator & Cost Structure (link).
- Why isn’t the Government shrewder when negotiating concession agreements?
Many sections of the public feel that the Government is not relentless enough when negotiating concession agreements. What they fail to realize is these highway operators are also businessmen who have invested heavily in these projects with intention of making money. They have spent millions on highway development and maintenance for this purpose. However, what they are contributing is also beneficial to the public, so it’s a win-win situation. For more info, please read our explanation toll rates (link) and on tender process for privatization (link).
- Why doesn’t the Government take over the tolled highways or try and reduce the number of tolls?
Firstly, the Government has the responsibility of honouring the conventions of business, especially in protecting the financiers from any unlawful proceedings. The investment in highway concessionaires is usually done after taking into account the return and risk expectations involved. It is crucial for the concessionaires to be confident of their investment, especially with regard to any sudden rules imposed. For more info, please read our explanation Business of Toll Operator & Cost Structure (link).
- Why can’t the toll hikes just be contained or frozen?
It has to be said that there are recurring costs when it comes to maintaining and upgrading highways. With the cost of living constantly on the rise, toll operators need steady resources to ensure that highways are maintained according to international standards. Highway concessionaires have also signed a long-term concession, which is based on a business plan and financial forecast, so a freeze would affect their ability to maintain the highways in a consistent manner. Again, the Government would also need to honour its agreement with the toll concessionaires, or it would lose its credibility. For more info, please read our explanation Business of Toll Operator & Cost Structure (link).
- It is said that highway concessionaires make exorbitant profits. Please explain.
This is a common misconception. For every RM1 toll collected, the highway concessionaires spend most of it on expenditure such as operation costs, maintenance and loan repayments. The profits made by concessionaires also mean they can pay higher tax and dividends to the Government, which can be used on other facilities such as hospitals and schools. For more info, please read our explanation on Business of Toll Operator & Cost Structure (link) and Toll Rates (link).
- How has the highway development contributed to the country’s economy?
The emergence of privatised highways has contributed immensely to the growth of many sectors – real estate, tourism and industrial among others. For more info, please read our explanation on privatisation (link) and highway economy (link).
- How advanced are the facilities on Malaysian highways?
Malaysian highways offer the best highway facilities for its users and this has been recognized globally. For instance, the Stormwater Management and Road Tunnel (SMART) was bestowed with the UN Habitat Scroll of Honour Award for its management and easing of peak hour traffic, especially during flood storms. Safety features are also a standout, as exemplified by the Ampang – Kuala Lumpur Elevated Highway (AKLEH), which is equipped with the Vehicle Detection System (VDS), a cost-saving system used to detect, manage and reduce traffic. This system has been implemented in other countries and is a proven success so far. For more info, please read our explanation on Highway Design (link) and Highway Safety (link).
- How efficient are the highway authorities when it comes to dealing with stalled/malfunctioned vehicles?
Some highways, such as the PLUS and Kajang Dispersal Link Expressway (SILK) highways, offers a 24-hour patrol team which is on hand to offer their services to any distressed vehicle. Besides that, most of the highways are also equipped with emergency telephones and an emergency hotline for users to call should they encounter any problems while travelling. For more info, please read our explanation on Highway Management (link).
- How does the highway deal with traffic management to ease congestion?
Currently, all highway concessionaires are required to set-up an Integrated Traffic Management Centre to connect to a VDS. This Traffic Management Centre compiles the information of 18 toll highways, for which they install 257 Vehicle Detection Stations, 250 Closed-circuit Television (CCTV) and 105 Variable Message Signboards (VMS) which keeps road users informed of traffic conditions. For more info, please read our explanation on Highway Management (link).