GEORGE TOWN – Penangites who have long used the state’s ferry service have expressed their shock that it was never made eligible for subsidised diesel and it has been operating at a loss despite being frequented around the clock.
On November 25, the Penang state legislative assembly was informed that the ferry service had incurred an estimated amount of RM14 million in losses per year, citing operator Penang Port Sdn Bhd’s (PPSB) financial reports.
State Infrastructure, Transport and Digital exco Zairil Khir Johari said that ferry ticket sales could only cover around 35% of the total operational expenses of PPSB.
The high cost of diesel was cited as one of the factors for the losses as it is bought at market price and no subsidy is given for the ferry service. Other factors mentioned were the costs of annual inspection, mandatory maintenance works, and service insurance exceeding RM2 million per vessel annually.
The ferry users’ response also came amid yesterday’s statement by Transport Minister Anthony Loke that his ministry has obtained an “in-principle” approval from the Finance Ministry to provide subsidised diesel to all ferry operators serving the main islands around the country starting January 1 next year.
A ferry user from Batu Ferringhi, who preferred to be known as Aizat, 27, said that he was surprised to have learned that the ferry service never qualified for subsidised fuel until Putrajaya began implementing a targeted subsidy mechanism on June 10.
This is as he said that Penangites’ reliance on the service should have assured PPSB of its eligibility in the first place.
“It is puzzling (to learn about this) since this service has been used by both the public and tourists to travel back and forth from the island and mainland every day. Therefore, it is time (for operators to qualify for subsidised fuel),” the sports shoe salesman told Scoop when met at a ferry inbound to Raja Tun Uda Ferry Terminal in George Town from the Butterworth Ferry Terminal.
Meanwhile, another ferry user, who preferred to be known as Ajit, 35, said that he found it “odd” that PPSB was never made eligible for the subsidy despite it being frequented by motorists and pedestrians around the clock.
However, the agriculture sector worker also questioned how the ferry operator has been running at a loss even though ticket price for the new ferry units cost RM5 per round trip, which he said is pricier compared to the RM1.20 per round trip rate from the old service which used the now-decommissioned ferries.
“People would board the ferries daily, regardless of what happens. So, how is it that (the ferry operator) can say that they have been incurring losses despite the tickets being pricier?
“This is what I find weird as well,” Ajit told Scoop, despite acknowledging that the old ferry services have also incurred losses. Nevertheless, he said that the diesel subsidy is needed by the service as it has been one of the main transportation modes of choice for Penangites.
Echoing Ajit’s sentiment on the service’s need for subsidised diesel are Butterworth natives Amin Che Rus, 38, and R. Magendran, 50, who said that the Finance Ministry must allow the service to use subsidised fuel as it has made it convenient for Penangites from Northern Seberang Perai to commute to the island for work.
“Otherwise we would have to go all the way to the first Penang bridge to commute to the island which is tiresome.
“The ferry service has made it easier for us (working people) to travel to the island, and I think that (alone) should justify the operators to use subsidised (fuel),” Magendran, who is a factory supervisor, told Scoop.
Boon to Penang tourism
Meanwhile, a private sector employee, who preferred to be known as Mohammad, said that the ferry service should be enjoying subsidised fuel from the get-go since the service has been used by tourists to travel to the island upon touchdown at the Penang Sentral Butterworth express bus terminal.
“The ferry service has (also) become a (tourist) attraction and it should have been given more attention by the government,” he added.
The four new ferries – Teluk Bahang, Teluk Kampi, Teluk Duyung and Teluk Kumbar – commenced operations at Raja Tun Uda Ferry Terminal on August 7 last year.
The vessels operate 68 two-way daily trips every 20 minutes during peak hours and 30 minutes during non-peak hours. A vessel can accommodate 150 passengers and 50 motorcycles and bicycles.
No to fuel subsidy for private operators
However, L. Nadeson, 67, a private sector employee, said that PPSB should not be made eligible for subsidised fuel given its status as a private operator.
Echoing Ajit, the Butterworth native also questioned how PPSB incurred losses despite catering to hundreds of passengers per trip, which includes school students, and is fully operational throughout the month with no off days.
“You have four ferries that operate until 11pm and they would be crowded during weekends and school days. So, how can you record a loss?,” he told Scoop.
Nadeson emphasised that losses incurred by PPSB should not be factored into deciding whether to make it eligible for tax-payer subsidised diesel, as he said that subsidies should be channelled to destitute, deserving folks.
He emphasised that it is normal for businesses to record losses and profits throughout their operation, using the sea as an analogy.
“A business is like the sea that faces both high and low tides. The water level will rise as high as it can during high tides, but it will also recede as low as it could during low tides.” – December 16, 2024.