Covid-19 has destroyed thousands of jobs, why is Penang Forum stopping job creation?

Penang Forum members have been lobbying hard to cancel development projects that can generate thousands of new job opportunities in Penang.

Their latest statement opposing the Penang South Reclamation (PSR), penned by Khoo Salma, is a disappointing piece, not only because it contains many misleading information but also of its disregard for the wellbeing of Penangites and the future of Penang.[1]

What is misleading? Many, but I shall just point to the one with misleading impression that the State Government is not developing Seberang Perai or optimising mainland for industrial expansion.

The impression is misleading because out of the 10 industrial parks developed by the State Government, 9 of them are located at Seberang Perai.

For further expansion of industrial development, another 1,156 acres of new lots on the mainland were identified for industrial use on top of the initial 2,898 acres that have been allocated.[2]

State Government is optimising the mainland for the state’s economic development, contrary to the false impression given by Penang Forum.

Now, back to job creation.

Generating new jobs is especially important during the current Covid-19 crisis when many Penangites are suffering from retrenchment.

Many are hoping that their savings can last until the crisis is over.

The PSR and the Penang Transport Master Plan (PTMP) have been identified by the Penang Socio-Economic Recovery Consultative Council – comprises of industrial leaders and state leaders – as key recovery drivers to create jobs and stimulate the state’s economy through domestic investment.[3]

I have spoken to those involved in PSR and PTMP and was told that more than 100 Penangites are currently employed for the two projects. That means hundred of families have food on their table because of these projects.

Will Penang Forum be happy when a hundred families go hungry due to the cancellation of the projects as the result of the NGO’s lobby?

I was also told that the first three years of the reclamation will generate another 5,000 new jobs in Penang, which include job opportunities with stable income for the fishermen in the PSR area.

37% of the participants at the walk-in job interview held on 24 April 2021 were fishermen looking for new job opportunities provided by PSR.[4] These chances for a more stable life will be ruined if the PSR is cancelled.

What is Penang Forum trying to prove by wanting to stop job creation in Penang? What do they gain when Penangites have no jobs? 

References

[1]https://www.nst.com.my/opinion/letters/2021/05/689811/penang-south-reclamation-who-does-it-serve
 

[2]https://www.buletinmutiara.com/penang-govt-to-ensure-adequate-supply-of-industrial-lands/ and https://www.freemalaysiatoday.com/category/nation/2019/05/02/with-land-for-industries-running-out-we-sorely-need-3-island-project-says-chow/
 

[3]https://www.malaymail.com/news/malaysia/2021/02/17/penang-transport-master-plan-part-of-covid-19-recovery-efforts-says-state-e/1950528
 

[4]https://www.facebook.com/pusatperkhidmatansetempatnelayan/posts/4110184375711596

Misperception clouding Penang Forum’s view of transport plan

The Penang Forum steering committee’s statement about the Penang Transport Master Plan (PTMP), published by Free Malaysia Today today, has again misled the public by alleging that the project has failed because it involves land reclamation through a joint-venture (JV).

As often announced by Penang state officials, the reclamation is part of the financing method for PTMP.

The federal government has not been forthcoming in offering financial grants to fund the PTMP. The loan guarantee to build the Light Rail Transit (LRT) has also been cancelled by Putrajaya.

In order to build a reliable public transport system in Penang, the state government has to find ways to kick-start the project.

Forming a JV company to begin the planned land reclamation work is a huge step towards realising the PTMP, which unfortunately had been misperceived by Penang Forum.

Nevertheless, misperception is not alien to Penang Forum.

When the PTMP included the LRT line, BRT line, and monorail line to provide a better public transport system at Seberang Perai, the Penang Forum misperceived it as cost inflation.

When the Penang government used request-for-proposal (RFP) to call for tender – the same procurement method employed and recognised as open tender by the United Nations, World Bank, and the World Health Organization – the Penang Forum claimed that the RFP was not an open tender.

When the world’s foremost authoritative organisation on climate change, the United Nations’ Intergovernmental Panel on Climate Change reported that “land reclamation is mature and effective technology and can provide predictable levels of safety” to fund climate adaptation projects (Special Report On The Ocean and Cryosphere In A Changing Climate), the Penang Forum protested against reclamation, denying it as climate action.

With such a track record of misperception, and in view of Penang Forum’s recent statement on PTMP, one wonders if the group has completely lost it?

Why Penang needs the Light Rail Transit (LRT)?

Penang is a bustling state without a proper public transit infrastructure. Despite being second smallest and without natural resources, Penang has been punching above its weight by positioning itself as a robust industrial state, remarkably capturing 47 per cent of foreign direct investment in the first half of this year, amidst global lockdown due to Covid-19.

The pattern of post-pandemic mass mobility, with promising vaccine to be delivered in 2021, will very likely return to pre-pandemic proportion. Soon, roads in Penang will once again be packed by numerous users – workers, students, anyone – during peak hours.

The mobility modal split among the 225,000 person-trips taken during peak hours with a population of 1.56 million in a 2013 report was between 89% private vehicles and 11% shared transport services (including factory and school buses). The predominant public transport at that time was buses. When the population increases above 2 million from the current 1.8 million, the projected person-trips will be more than 300,000 while the level of modal split will be the same. (Penang State Government, The ‘Recommended Transport Master Plan Strategy,’ March 2013)

In layman’s term, if Penang remains status quo with just buses to serve the public, the increasing road usage will worsen traffic congestion. This is why Penang needs a reliable, safe, and efficient system – the Light Rail Transit (LRT) – as the main backbone for our public transport infrastructure.

The LRT is a time-tested rail system proven for its safety and reliability. The system is so established that according Asian Development Bank (ADB), one of the foremost authorities with a transport specialist team that has implemented sustainable public transport all over the world, the global trend is to build and expand LRT rather than metro or bus system.

While many cities have opted for the proven system, Penang Forum wanted to introduce a bus system known as Autonomous Rail Rapid Transit (ART) or “trackless tram.”

Despite its bombastic appellation, the ART is basically a bus. In fact, to David Levinson, professor of transport engineering at the University of Sydney, the title “trackless tram” is a “silly phrase” because it is actually a bus. The original cost for this bus was priced up to RM10 billion to be implemented in Kuching. Recently, it was announced to be less than RM6 billion.

A comparison study between LRT and ART, conducted by ADB for Penang, has recommended the LRT as a proven technology to be adopted. Penang deserves a time-tested public transport infrastructure which will serve as our main backbone line rather than a multibillion bus.

Of direct negotiations and open tenders

The heated exchange over direct-negotiated projects in the recent parliamentary sitting has once again raised question over the status of “request for proposal” (RFP) as an open tender method.

The criticism over the nature of RFP as open tender stemmed from the ignorance of classification of procurement approaches.

Any procurement method subjected to competitive submission of tender is “open”. This is in contrast with procurement that is directly awarded without involving the evaluation of various submitted proposals.

Open tender can be done in several ways, one of which is RFP. To borrow the classification from biology, open tender is genus while request for proposal is species.

The advantages of open RFP include the early identification of risks and benefits of the different proposals. RFP also allows for creativity and pushes for innovative solution.

Bidders can develop their best proposal for the project, while the project owner gets to evaluate the various counter-plans to choose the most suitable one.

RFP is not only a competition for the best price, but more importantly, a battle for the best solution within the stipulated specification.

In other words, RFP is a multidisciplinary procurement process that takes into consideration a range of factors and various aspects (environmental, economic, social, governance) in the decision-making process.

International institutions such as the World Bank, United Nations, Asian Development Bank, and World Health Organization use the RFP as open tender for their procurement need.

Penang was one of the earliest administrations in Malaysia that adopted the open RFP when the method was rarely practised in the public sector. Academician Goh Ban Lee had remarked the adoption was “new thinking” and “very refreshing.”

The Penang Transport Master Plan is one of the projects planned through open RFP. The tender was advertised and the public was invited to bid. A total of 55 local and international companies responded to the RFP, with six submitting their proposal.

Today, various government-linked institutions such as Bank Negara, Prasarana Malaysia Berhad, Malaysia Digital Economy Corporation, and Penang Port Commission are issuing open RFP to invite bidders to submit their proposal.

Not all procurements can be openly tendered. Items that are required in an emergency, copyrighted or specialised cannot be tendered.

Otherwise, the practice of open tender should be required for public infrastructure projects as much as possible in order to obtain the best solution for the people.

Innovation to develop excellent public transport

If you pay peanuts, you get monkey. The same applies to public transport. An excellent transit system is not cheap. 

However, public transport needs more than funds to achieve excellence. It requires good town planning. 

Here lies the problem - public transport and town planning are often conceived and operated as separate department. Transport experts focus only on mobility while planners on buildings and landscape. 

The result? Billions are pumped into public transport yet the usage of public transport remains dismal. 

The purported 2018 net losses of Prasarana Malaysia Berhad, the country's main operator of public transport, was between RM3 billion to RM5 billion, with estimated impairment of RM30 billion. 

With so many billions spent, how many trips were taken via public transport in Klang Valley? About 21%. At other places, the figure is way lower. In Penang, it's between 3% to 8%.

To complicate matters further, the states in Malaysia have limited control over tax money and automobile trade policies, which means that they don't have much say over public transport infrastructure.

States have more control over land use. Therefore, one solution is to incorporate town planning back into public transport development and vice versa. 

When we do that, then solving transport issues is no longer only about buying more buses or building a Light Rail Transit (LRT). It's about developing a transit city.

A transit city optimises public transport and generates fund through land usage to finance the development, maintenance, and upgrading of the transit system.

This idea, broadly known as 'transit-oriented development' (TOD), may be something new to many and suspicious to the skeptics, but it is time-tested and proven successful in various cities that are different from each other. 

Take Hong Kong's Mass Transit Railway (MTR) as an example. When MTR plan was unveiled with a price tag of HK$3.4 billion in the late 1960s, professor Sean Mackey from the University of Hong Kong publicly criticised the proposal for its hefty cost.

Through an innovative town planning method known as 'Rail + Property', the MTR Corporation has not only managed to pay off the construction cost of the initial MTR line but also recorded a total profit of HK$139.67 billion from 2009 to 2019, with 90% public transport usage.

Singapore's Mass Rapid Transit (MRT) had the same problem. The SG$5.3 billion MRT proposal was criticised by a team of experts led by professor Kenneth Hansen from Harvard University.

The Singaporean government did not back down. They undertook a 'land value capture' exercise to finance the MRT. The total revenue generated during the MRT development period from 1982 to 1987 exceeded SG$12 billion, more than enough to cover the construction cost. Today, the MRT serves as the backbone of Singapore's public transport system with 67% usage.

Other cities such as Copenhagen employs innovative 'profit sharing' method to fund their transit system.  In all sales agreements, the property buyer is required to pay additional fee every year for sixty years, after a metro station is built within 50 meters from the property. Copenhagen's public transport usage is 60%.

Details of these case studies can be found in Penang Institute's recent publication 'Exploring a Transit-Oriented Development (TOD) Framework for Penang’s Urban Growth.'

Penang is planning to build the Penang Transport Master Plan (PTMP) over the next several decades. This development can explore some of the TOD methods to finance the long-term transport plan.

Only the synergy from the best of transit development and town planning will save our public transport system from being a monkey business.

What is wrong with PTMP and PSI?

I believe the story in South China Morning Post (15 Feb 2020) and letter from Kua Kia Soong have been misinformed regarding Penang Transport Master Plan (PTMP) and Penang South Islands (PSI).[1]

They are misinformed by a group called Penang Forum, consists of non-governmental organisation (NGO) members and Opposition political leaders from parties such as PAS.

Not all NGOs are against the ruling government but all Opposition leaders are, by the virtue of their political ambition. However, when an NGO has again and again displayed anti-government diatribe, it becomes evident that there is something more beneath the surface.

Penang Forum has evolved over the years from a constructive NGO to an Opposition-affiliated, if not infiltrated, entity. This is most obvious from their protests against almost all of the state-initiated projects in Penang.

While the Penang government, led by Pakatan Harapan coalition, is leading the state into a world-class competitive and high-income city, these NGOs seem to be trying their best to turn Penang into Kelantan.

Apparently, some of these NGOs have lost their eligibility to receive grants from international bodies when Penang in particular and Malaysia in general have emerged out of the ‘Third World’ category.[2] Is that a motivation for those NGOs to see Penang remains in a ‘Third World’ state?

The PTMP and PSI have become these NGOs’ main complaints against the Penang government, so much so that they organised a forum with a string of speakers attacking these initiatives.[3] But, what is wrong with PTMP and PSI?

The NGOs alleged that these projects lack expertise, but what they really wanted was to push for their own view to be regarded as “expertise”.

I once sat in a focus-group session with three transport experts presenting three different proposals to address Penang’s traffic woes. One argued for on-ground tram, one for bus rapid transit (BRT), and another one for Light Rail Transit (LRT). It is therefore wrong for those NGOs to talk as if there is only one expertise view on the matter.

Furthermore, the PTMP’s LRT and PSI have been vouched for respectively by Universiti Sains Malaysia’s Deputy Vice-Chancellor and professor of transportation engineering, Dr. Ahmad Farhan Mohd Sadullah and eminent economist such as the chairman of Khazanah Research Institute, Dr. Nungsari A. Radhi.

Dr. Ahmad has remarked that the LRT “is imperative and urgently needed for Penang,” while Dr. Nungsari has stated that the PSI “is a perfectly rational economic project for a place like Penang.”[4]

These are prominent and experienced experts whom those NGOs, South China Morning Post, and Kua Kia Soong have ignored.

The NGOs have also alleged that the PTMP and PSI are projects that were adopted by state government to benefit developers. This is wrong.

Those projects went through open tender in the form of request-for-proposal, a method used by the World Bank and United Nations. The present PTMP was the result of an evaluation over six different proposals by KPMG and hundreds of stakeholder engagement sessions.

In fact, the increase of the estimated cost for PTMP from RM27 billion to RM46 billion came from those stakeholder engagement sessions that requested transport infrastructures such as LRT, monorail, and longer BRT to be built on the mainland.[5]

By wanting to smear these projects, those NGOs highlight only the cost increase but hide the rationale behind the increment. That’s why the article in South China Morning Post and by Kua Kia Soong make no mention of this – misinformed by the NGOs.

I used to think that such smearing campaign was only carried out by the current Opposition political parties, until I came across Penang Forum.

The open tender method did not end with the PTMP. The PSI is currently going through a master design competition involving various globally renowned planners and architects working hand-in-hand with local firms to provide the best proposal that will benefit Penang in the long-run.

So, what is wrong with PTMP and PSI?

They are definitely not perfect plans, there will be impact, and mitigation measures will need to be in place to address those.

Nevertheless, they are gamechanger infrastructures that will path Penang’s future. And Penang Forum and Opposition politicians will continue to collaborate to do their best to prevent that from happening.

---

[1] https://www.scmp.com/magazines/post-magazine/long-reads/article/3050442/fight-save-penang-proposed-mega-projects and https://www.thesundaily.my/opinion/civil-society-groups-protect-democracy-ME2017079

 

[2] https://www.malaymail.com/news/malaysia/2020/01/11/consumers-association-of-penang-turns-50-with-a-new-president-but-poorer/1826865

[3] https://www.malaysiakini.com/news/510976

[4] https://www.nst.com.my/news/nation/2019/09/521306/transforming-penangs-transport-system and https://www.theedgemarkets.com/article/mysay-coastal-fishermen-and-public-transport

[5] https://www.theedgemarkets.com/article/cost-penang-transport-master-plan-balloon-rm46b-says-project-delivery-partner