Penang Island residents see red over hefty rate hikes

The hefty hikes in Penang Island City Council assessments a year after Pakatan Harapan was returned to power in the Penang has alarmed many Penang residents.

It shows us that that short new “toll-free” highway in Paya Terubong – which is not a long-term solution to congestion – is not exactly free. It also shows us that the unending expenditure on CCTV cameras and related infrastructure – running into the millions – is taking a toll on ratepayers.

One house on the island (not a prime residential area) received a notice for a rate increase of just over 60%. Another home owner received a notice for a 55% hike. And I have heard of other hefty hikes, some more than 70%. How are pensioners and those on a limited or with little income going to pay up.

The Penang Island City Council expects to rake in an additional RM54m in revenue from these rate hikes.

The government is telling us these rates compare favourably with those charged by Kuala Lumpur City Hall and Putrajaya. But what it doesn’t tell us is the median household incomes of Kuala Lumpur (RM9,073 in 2016) and Putrajaya (RM8,275) are much higher than Penang state’s RM5,409 (I don’t have the figure for Penang Island alone, which would be a bit higher).

The Penang Island City Council incurred expenditure of RM392m in 2016. Back then its deficit was just RM1.4m.

But by 2017, expenditure soared to RM457m, and last year it was RM455m. For 2009, the budgeted estimate is RM506m – that’s a 30% increase in three years.

Why this increase? Let’s look at some of the recent projects from 2015 to 2018, which cost RM122m:

• RM99m – Paya Terubong highway from Thean Teik Highway to Bukit Jambul Street, excluding land acquisition – So you are paying for this highway through your rates and it is not even a long-term solution for congestion
• RM19m – Sports complex, CCTV building, etc – Why do we need a building for CCTV? Where is this building?

For 2019, the council has committed RM468m on various projects. That is more than the budgeted income of RM411m for the council for 2019. What kind of ‘brilliant’ financial planning is this?!

This includes a staggering RM408m for:

• the Paya Terubong paired road – More spending on roads instead of public transport – and it is just a short road. Why can’t the federal government fund such roads through the JKR, now that Pakatan is in power at the federal level? But why spend so much roads in the first place when more enlightened citiy planners around the world are improving pedestrian and public transport infrastructure. This reveals the backward thinking of those responsible for the highway projects in Penang.
• development of “Intelligent Video Analytics” and an “Intelligent Operation Centre” – What is this? Are we getting value for money here? What benefits do citizens feel?

It also includes RM35m for, among other things:

• 767 CCTV cameras on the island (including 22 for monitoring hill slopes – which is fine) – what are all those CCTV cameras for?
• RM7m was also spent on 150 new CCTV cameras. More CCTV spending! Is this really necessary at this time?

Have they lost the plot in their enthusiasm for these so-called “projects”. The phrase “menelan belanja” that they often use when annoucing budgets or financial result is apt in this case. It literally means “swallowing expenditure”!

For 2020 to 2022, the city council plans to spend another RM179m on projects including RM11m for another 100 new cameras and maintenance of existing cameras.

Do we really need to turn Penang Island into a CCTV island under Big Brother surveillance? Has any study been made on the effectiveness of these cameras in reducing crime? What are the amounts lost through such crimes compared to the millions being spent on CCTV infrastructure?

What about all those lands sales by the state government including those under Chief Minister Inc? (Where are the audited financial statements? What are the hundreds of millions being used for?) Why not spend some of these as grants to the council instead of raising rates at this time of economic uncertainty?

But first tell us, why spend so much on roads instead of improving our bus service?

Why spend so much on CCTV infrastructure, year in, year out? Has there been a study showing its effectiveness in drastically reducing the crime rate?

And was it really necessary for the state government to buy a fleet of new Camrys at this time – and then burdening the people with hefty rate hikes? What message that does send out?

Raising rates at this time will only increase the cost of doing business and the cost of housing rentals while reducing purchasing power.

In the first place, why the need to hike rates when so many housing projects have been approved all over Penang Island, which will generate more assessment revenue for the council – unless those news homes remain unoccupied or the buyers are unable to cough up the rates. The council should tell us how much of assessments are in arrears over the last 10 years.

See, this is what happens when we don’t have local council elections. It seems they don’t understand the principle of “no taxation without representation”.

Now we wait for bated breath for the quit rent notices, payable to the state government.

What will happen when the state government has to incur annual maintenance costs of some RM40m-RM60m for the “toll-free” RM9bn Pan Island Link (PIL) highway under the RM46bn “PTMP”?

What will happen if the state government has to absorb losses arising from the RM170m annual operation and maintenance cost of the proposed elevated light rail (LRT) if it fails to meet its over-optimistic ridership estimate?

What happens if the state has to incur hundreds of millions of ringgit on periodic dredging to clear the siltation arising from the massive Penang Southern Reclamation and other reclamation projects in the state?

No prizes for guessing who will ultimately bear these costs while a small select group of construction corporations and developers rake in the profits.

I fear these rate hikes are just the beginning.