ERL concession extended by 30 years
KUALA LUMPUR: The Express Rail Link Sdn Bhd (ERL) concession was extended for another 30 years after the government prohibited it from hiking the rail fare.
Stating this, Deputy Transport Minister Datuk Abdul Aziz Kaprawi said the government has to compensate the concessionaire.
“When we don’t allow them to increase the fare, we must compensate. So, we extended the contract for another 30 years,” he said.
Abdul Aziz said the government has adopted a new approach since last year by setting the ceiling price at RM64 if ERL wants to hike its fare.
ERL is entitled to a fare review every five years under the initial 30-year contract, which was supposed to end in 2029.
He said the ERL received a total RM741.23 million in passenger service charge (PSC) from 2002 to September this year.
However, it will no longer be able to collect the PSC after 2029.
Abdul Aziz was responding to a question by Tan Sri Khalid Ibrahim (Independent– Bandar Tun Razak), who asked the total amount Malaysia Airports Holdings Berhad (MAHB) paid to ERL since 2002 to meet the concession terms, government’s compensation since 2008 and ERL’s financial performance.
Currently, ERL collects RM5 from international passengers and RM1 from domestic passengers.
Abdul Aziz said ERL’s passenger load dropped 19% after it revised its fare from RM35 to the current RM55.
The number of passengers dropped to 8.9 million last year from 11.03 million in 2014 after the fare revision to the present rate of RM55.
“Since the ERL began its operations, it saw an average of 5.46 million passengers a year.
“There was an increase of 20% in passengers in 2015 compared with the 11.03 million in 2014,” said Abdul Aziz.
He said the ERL had recorded cumulative losses in taxes amounting to RM661.24 million until the 2016 financial year.
Under an agreement signed in 2002, MAHB agreed that RM5 from the airport tax paid by every KLIA international passenger was to be paid to ERL, regardless of whether or not the passenger had used the train.
ERL had on Dec 1, 2015 announced that the fare for its KLIA Express service would be increased from 2016 from RM35 to RM55, while the rates for its KLIA transit was also increased by between 45% and 57%.