No more subsidies for RapidKL, says Najib

No more subsidies for RapidKL, says Najib

29-05-2008
by Kevin Tan

KUALA LUMPUR: The government will no longer provide subsidies to Rangkaian Pengangkutan Integrasi Deras Sdn Bhd (RapidKL) as part of its plan to cut down subsidies, Deputy Prime Minister Datuk Seri Najib Razak said yesterday.

Speaking to reporters after chairing the Cabinet Committee on Public Transportation in parliament, he said the decision takes effect immediately and there will be “some adjustments” to RapidKL’s LRT and bus fares. The “rate of adjustments” will be announced later.

“RapidKL will not impose subsidised rates and would compete on a level playing field with other bus operators,” Najib said.

RapidKL, which is 100% owned by the Ministry of Finance, operates two light rapid transit (LRT) systems — the Ampang Line, which was formerly known as STAR, and the Kelana Jaya Line which used to be called PUTRA.

According to RapidKL, the two lines carry about four million passengers each week. After taking over the Intrakota and Cityliner bus services, the company operates 165 bus routes that cater to some 192,000 passengers in the Klang Valley every day.

“This is part and parcel of our effort to streamline our policy towards subsidies but more so, we don’t want them to kill local companies,” Najib said.

He explained that the government had considered the plight of bus operators in the Klang Valley and there was a “moral principle” in the decision as bus operators were “going bankrupt” due to government’s subsidy for RapidKL.

There were a number of bus companies in KL that used to be profitable but they were currently losing money, he said.

On the effects of the removal of subsidies, Najib said: “There will be a bit of adjustment but we are saving taxpayers’ money.” He said it was “unfair” to use taxpayers’ money to subsidise RapidKL’s services.

Najib also said the government would reveal the amount of subsidies provided to the company.

“We will also study how RapidKL can complement what is being offered by local bus companies,” he added.

The Cabinet Committee has also proposed the setting up of a public transportation commission at the national level to streamline functions such as licensing and regulating public transport, which is currently under 13 agencies.

Najib said it was better to have a single authority to control, develop and regulate the country’s public transport system in an effective and orderly manner.

“This proposal needs to be examined in detail and it will be discussed by this committee again before it is forwarded to the government… Our idea is to establish a single authority that is responsible for public transportation nationwide,” he added.