S’pore to spend over S$300 million on HSR by year-end, Khaw says in urging M’sia to clarify its position

SINGAPORE – The Republic could incur some S$300 million on the Kuala Lumpur-Singapore high-speed rail (HSR) by year-end, Transport Minister Khaw Boon Wan said in Parliament on Monday (July 9) as he warned that a “significant” amount of the funds spent would be “completely wasted” if the project was called off.

Giving a detailed breakdown of the costs involved for the first time, Mr Khaw said the Government had spent over S$250 million on the project by the end of May this year. The project was first mooted by Malaysia.

In June, Singapore had spent over S$6 million on the project and expects to spend a similar amount for it in July.

Costs for the project are expected to “increase rapidly’ with time, the minister added, estimating the expenditure for the August to end-December period at over S$40 million.

The money was spent on land acquisition, manpower needs, hiring of consultants, and the setting up of companies to deliver on the project, among other requirements.

"This is actual money that has already been spent, our taxpayers money. We can recover value for some of the expenditure, even if the HSR Project does not proceed,” Mr Khaw told Parliament.

“But a significant amount which has been spent, will be completely wasted expenditure, if the project does not proceed.”

Questions surrounding the HSR were among several related to Singapore-Malaysia ties that Members of Parliament raised as Parliament reconvened on Monday.

The “game changing” HSR project, a 350km line scheduled for completion by 2026, would have slashed rail travel time between Singapore and Kuala Lumpur to 90 minutes.

But its fate has been uncertain since Malaysia’ new Pakatan Harapan government won the May 9 election, with the country’s new Prime Minister Dr Mahathir Mohamad and some of his cabinet ministers vowing to scrap the project in order to trim Putrajaya’s RM1 trillion debt.

Adding to the confusion, Dr Mahathir subsequently said that his government intended to “postpone” the project and would speak to their Singapore counterparts.

Mr Khaw said Singapore had sent a diplomatic note to Malaysia on June 1 seeking clarification on its position on the HSR project. But Singapore has yet to receive a reply, he added.

At this point therefore, we have been left with no choice but to continue performing in accordance with the bilateral agreement (for the HSR), and thus continue to incur more costs,” said the minister.

“It will be most unfortunate, if Malaysia has in fact decided to terminate but delays in notifying us, because there will be further wasted expenditure.”

And should Malaysia decide to formally terminate the project, Singapore will pursue the issue of compensation from Malaysia in accordance with the HSR bilateral agreement and international law, said Mr Khaw.

He pointed out that the Singapore Government is duty-bound to account for the public funds spent on the HSR, adding: “It would not be fair for the taxpayers of one country to bear the cost of another country’s actions.

“Compensation is not a penalty imposed on the other country.”

Mr Khaw said Singapore would continue to press Putrajaya for an official clarification on the HSR, noting that it was in Malaysia’s interest to do so early as the ongoing costs would add to the compensation which the Pakatan government would have to pay.

JURONG LAKE DISTRICT: PLANS STILL RELEVANT

Separately, National Development Minister Lawrence Wong told Parliament that plans to develop the Jurong Lake District – where land has been set aside for the construction of the HSR Jurong East terminus – are still relevant, notwithstanding the lingering uncertainty over the status of the rail project.

Among the plans at the district include developing a commercial precinct and building up to 20,000 new homes, and setting up a major transport hub connecting existing and upcoming MRT lines.

“These plans are still relevant today. The land parcels that the government has acquired are needed to realise these plans,” said Mr Wong.

The site, where Jurong Country Club sits, will provide for new mixed-use developments and community facilities, while the Raffles Country Club site is needed for the Cross Island Line’s western depot and other transport related uses. 

Responding to MP Alex Yam (Marsiling-Yew Tee) question on the implications on the district should Malaysia cancel the HSR project, Mr Wong said that plans to establish the Jurong Lake District started way before Malaysia proposed the HSR project.

The government decided to locate the terminus in Jurong in 2015, only after a further study of the HSR proposal, he added.

“Regardless of the outcome of the HSR project, the overall impetus and vision for Jurong Lake District have not changed. Some details may need to be adjusted along the way, as circumstances change,” said Mr Wong.

“The bottom line is that we have an exciting transformation plan for the whole area, and we will proceed with the implementation of these plans when ready.”

NO UPDATES FROM MALAYSIA ON RTS LINK

Speaking in Parliament on Monday (July 9), Transport Minister Khaw Boon Wan also updated the House on another joint infrastructure project with Malaysia - the Johor Bahru (JB) – Singapore Rapid Transit System (RTS Link) project.

Mr Khaw said the Government has not heard “anything officially from the Malaysians on their intentions on the RTS”, amid mixed signals and uncertainties from Putrajaya on its major infrastructure projects with regional partners.

Malaysia’s Transport Minister Anthony Loke had earlier said that while the RTS project would not be scrapped, it would be postponed until the country’s Cabinet approved a feasibility study. However, he subsequently expressed hopes that the project could be accelerated.

“We have not heard anything officially from the Malaysians on their intentions on the RTS Link,” said Mr Khaw. “To proceed or indeed speed up the project, many implementation issues have to be sorted out.”

The RTS project, to be undertaken through a joint venture between Singapore’s SMRT Corporation Limited and Malaysia’s Prasarana Malaysia, aims to significantly reduce congestion at land checkpoints.

The 4km rail system, which will connect Woodlands in Singapore and Bukit Chagar in Johor via a 25m-high bridge, can carry up to 10,000 passengers per hour in each direction at its peak.

Mr Khaw told Parliament that under the agreement that had been inked for the bilateral project, SMRT and Prasarana were to have incorporated a joint-venture company to become the RTS Link operator by June 30.

“That did not happen as Prasarana had suspended discussions with SMRT after Malaysia’s General Elections,” the minister added. “This means that both countries should now proceed to call an open, international tender to appoint the RTS Link operator, unless we mutually agree on a postponement of the deadline.”

Meanwhile, Mr Khaw said Singapore will work with its neighbour to reduce congestion through other measures. Some have been implemented such as lowering the tolls during off-peak hours at Tuas Checkpoint.

“These measures have helped to alleviate the congestion but are not the complete solution,” said Mr Khaw. “We look forward to the completion and operation of the RTS Link, which will be able to transport 10,000 travellers per direction per hour between Singapore and JB.”

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