KUALA LUMPUR: Weak communication has led to the controversy surrounding the cost of constructing the mega East Coast Rail Link (ECRL) project, industry specialists said.
They also said the government should be more transparent with the reasons for the variations in the three iterations of ECRL.
"If ECRL 3.0 costs less than ECRL 1.0, the government should have stated that the overall costs had been reduced. If the government wishes to highlight on actual savings, it should be compared apple to apple on specific items," transportation expert and consultant YS Chan told the New Straits Times.
Citing the Mass Rapid Transit project as an example, Chan said its costs could have been reduced if less grandiose stations were built and this would lead to a reduction of the overall costs.
But if the same grandiose stations were built at a lower cost, then it was savings, he added.
The ECRL has been criticised relentlessly by many quarters since its construction kicked off about five years ago, amid constant tweaks to the project every time there was a change in the government.
Early last month, Transport Minister Anthony Loke reportedly said the ECRL project would proceed without any changes.
Loke, speaking to reporters after clocking in at the ministry in Putrajaya on Dec 6 last year, noted that the massive rail project was among those under his ministry that would continue despite the change of government.
On Dec 21, Prime Minister Datuk Seri Anwar Ibrahim, however, reportedly said the project (ECRL 3.0) would continue with a cost reduction of RM11.01 billion, compared with the original (ECRL 1.0) total cost of RM85.97 billion approved in 2016.
The new total cost of RM74.96 billion was, however, higher than the RM50.27 billion quoted by then transport minister Datuk Seri Dr Wee Ka Siong in 2021, after several changes were made to the project's alignment.
Subsequently, Loke explained that the ECRL 3.0's total development cost savings of RM11.01 billion were the results of two negotiations carried out since 2018.
He said ECRL 3.0's RM74.96 billion consisted of construction costs of RM50.27 billion and other costs including interest during construction and land acquisition costs amounting to RM24.69 billion.
On the changes from ECRL 2.0, which had been signed and sealed at a lower cost to ECRL 3.0, Chan noted that one of the possibilities that led to a lower cost could be that many facilities were cut off from ECRL 2.0 that could compromise the efficiency or quality of the project.
"And therefore, it was reinstated. If that was the case, then the cost of ECRL 3.0 should be compared to that of ECRL 1.0, not ECRL 2.0," he added.
Sunway University Business School professor of economics Dr Yeah Kim Leng said the total cost of ECRL 3.0 should be compared with the earlier two versions under the previous administrations.
"The reasons for the variations should be explained in the interest of transparency, integrity and accountability," he added.
Yeah said the estimated RM15 billion gap between ECRL 3.0 and ECRL 2.0 could be driven by the rise in material costs, interest payments, number of stations and tunnels in the new alignment.
The inclusion of an independent power producer in ECRL 3.0 would also have raised the overall cost, he added.
"Apart from costs, it would be beneficial for the government to reveal the development benefits, economic activities and commercial ventures and social projects that are being planned to maximise the spillovers from this mega infrastructure investment that forms part of China's Belt and Road Initiative involving more than 140 countries."
On the RM1.1 billion compensation/cancellation charge for changes made to the project, Yeah said this was likely to involve realignments, delays, design variations and other pecuniary changes to the agreement signed with the joint-venture company.
