HSR termination compensation: Singapore spent S$270 mln on project

The republic's Minister for Transport Ong Ye Kung said this in Parliament today, in response to one of the questions related to the HSR.

He said Singapore had spent more than S$270 million on the project.

"Some of these costs, such as for consultancy services, design of infrastructure, and manpower to deliver the project, are abortive costs if the project does not proceed," he said.

Ong was asked on what had been the total amount of expenditure incurred to date by Singapore on the project and what were the terms specified in the HSR Bilateral Agreement in relation to compensation claims upon termination of the agreement by either party.

On Jan 1, both Malaysia and Singapore's prime ministers issued a joint statement on the lapse of the HSR Bilateral Agreement.

By virtue of the Bilateral Agreement and previously agreed terms, Malaysia said it will honour its obligations under the Agreement.

According to Ong, the compensation amount for the termination and schedule for payment are specified in the agreements.

"In addition, there is a small component of miscellaneous abortive costs for the suspension of the project requested by Malaysia that Singapore is currently verifying, before we send to Malaysia," he said.

Earlier today, Minister in The Prime Minister's Department (Economy) Datuk Seri Mustapa Mohamed stressed that the compensation was not punitive but to reimburse the specific cost of the project that Singapore had already spent.

"We are waiting for the cost details from Singapore, and once received, it will be scrutinised before being confirmed. The types of claims allowed have already been agreed upon," he said.

Ong also said due to confidentiality obligations under the HSR Bilateral Agreement, Singapore was not at liberty to reveal the exact terms in relation to the compensation for the termination of the HSR Project.

To date, he said Singapore has already received about S$15 million from Malaysia, arising from Malaysia's request to suspend the construction of the HSR Project back in 2018, up to May 2020.

To another question on whether Singapore would consider an HSR-like project with Malaysia, Ong replied, "whether we are open to future discussions, of course we are, but it should be on a clean slate after we settle the current HSR Bilateral Agreement".

On whether cancellation of the HSR will have any impact on the Johor Bahru-Singapore Rapid Transit System (RTS), Ong replied, "the short answer to the question is no".

"RTS is progressing well so far. The JB side have broken ground ..our side we will break ground soon. We hope the project and the service can commence in 2026 as scheduled."