Sabah people stand to lose with increased tariff

The electricity tariff hike 'Sabah may lose out investors to S'wak'

INANAM: Sabah Progressive Party (SAPP) said the excuse that Sabah Electricity Sdn Bhd (SESB) continued to incur losses so as to justify increasing the State's electricity tariff cannot be accepted because the company had made a profit in 2006.

Its Deputy President Datuk Eric Majimbun said this was based on the SESB audited accounts showing it registered a net profit of RM126 million as at Aug. 31, 2006, which was a turnaround for the company.

"The said financial year had been a watershed in the history of SESB. It made a turnaround, and therefore we want to ask why a turnaround company such as SESB needs to impose the electricity tariff hike?" he told a press conference at the party's Sepanggar office here.

Ensuring SESB does not continue to incur losses was one of the reasons for the Government allowing the utility company to increase the electricity tariff in Sabah.

Majimbun also asked the reason for SESB to make losses to the extent that it is necessary to charge higher to relieve its financial predicament.

"Before imposing the hike, had SESB exhausted other means or employed other measures to cut its losses? What about mismanagement? Unwarranted electricity loss? We are sure such steps, no matter how small, if taken in a integrated manner, can minimise the need for such an excessive tariff hike,” he charged.

He said there had been much feedback and reports on the recent SESB tariff hike, adding the party would like to go a step further and undertake to assess the impact of the hike on commerce and industry in Sabah.

"If it is treated as an isolated case, the results are what the recent analyses have to say. A simple comparative analysis that we did showed the revised rate is across-the-board in excess of 10 per cent more than Sarawak," he said.

This shows we have very little competitive edge over our surrounding neighbours, he added, saying in the past electricity was one major factors to maintain Sabah's edge in keeping industries in the State.

"We now see whatever little edge we had has eroded. Do you think new industries are interested to come to Sabah? Will the existing industries prefer to remain in Sabah? It is our opinion that the new tariff will be catastrophic to the industries in Sabah," he said.

"According to reliable industrial sources, the excessive hike caused them to review their operations in Sabah. We can expect an exodus of industries in favour of neighbouring Sarawak which has a more competitive edge over us."

He said the State economic composition showed more than 70 per cent of its revenue/receipts belongs to the Federal Government and non-Sabahans.

"The funds we have circulating within the State that can generate a multiplying effect is already minimal and limited. Yet, SESB and our State leaders permit a suffocating electricity tariff. It would certainly erode our economic base further as long as the Sabahan asset is concerned. It causes a decrease in enterprises and hence less job opportunities," he said.

Inanam CLC Vice Chairman Don Chin (right), said he was informed that a shopping mall maintenance management company had already increased its charge from RM1 to RM1.35 effective Aug 1, which the company stated was because of the SESB's new electricity tariff.

Definitely this increase in maintenance charge will be absorbed by the shop operators in the mall concerned by increasing the prices of their saleable goods and the burden will end up on the consumers, he said.

DE by Larry Balon