KOTA KINABALU: The Federal Government has remained mum despite Sabah's repeated requests for the state’s constitutional right to receive 40% of its special grant revenue, says Sabah's Attorney General.
State AG Datuk Brenndon Keith Soh said that the deadline to resolve the issue "once and for all" lapsed on July 18 despite the state having officially written to the Finance Ministry regarding the matter since June 10, 2022.
"The state government of Sabah has at all material times been both professional and dedicated in the pursuit of the 40 per cent net revenue special grant under Article 112C and 112D of the Federal Constitution," he said in a statement Friday (July 26).
He said that as part of the interim arrangement agreed between the state and federal governments for ensuring a "transparent and constructive" negotiation, it was agreed that critical financial data involving the actual revenue derived from Sabah was supposed to be disclosed.
The essential "financial data" required involves the actual revenue obtained by the Federal Government from taxes, customs duties, licences, fees and fines amongst others in Sabah, he said.
A Sabah state special grant review committee was formed consisting of senior members of the civil service including the state Attorney General Chambers, Finance Ministry, Treasury Department and the State Economic Planning Unit together with independent professionals for advice.
"It has already been disclosed that since 2022, no less than eight official requests were made by the state to the Federal Government to obtain crucial financial data. Financial data was not shared or was incomplete," Soh said.
He said the issue was therefore brought up to the Malaysia Agreement 1963 (MA63) Implementation Action Council Technical Committee (JTMTPMA63) chaired by Deputy Prime Minister Datuk Seri Fadillah Yusof on May 28, 2024.
"Instead of prolonging the matter, the State informed JTMTPMA63 that they would take the initiative to calculate the net revenue due based on the limited financial data available.
"In response, the JTMTPMA63 was informed by the Federal Ministry of Finance that the negotiations would be held separately between the parties in June 2024," he said, adding that due to time and data constraints, the state committee prepared an updated official claim in anticipation of the negotiations to be held.
"That claim was sent to the Federal Ministry of Finance on June 18, 2024 with a further letter on July 1, 2024. To date, there has not been a response in writing.
"Notwithstanding this current quandary, the Federal Finance Ministry had on July 16, 2024 confirmed in Parliament that the Federal Government is committed to discussing a new special grant rate for Sabah.
"We therefore remain prepared, ready and able to commence further negotiations of the special grant due," Soh added.
Soh said that as stated and provided in Article 112D (6) of the Federal Constitution, should both the federal and state governments be unable to reach an agreement on any matter upon a review of the special grant, it shall be referred to an independent assessor whose recommendations shall be binding.
While waiting for the outcome of the negotiations for the 40% return of revenue, Koh said that the state government on an interim basis had agreed without prejudice to its constitutional rights and had obtained substantial increases in the special grant.
The Federal Government agreed to pay the sum of RM125.6mil in 2022 and RM300mil in 2023.
With little signs of the Federal Government sitting with the state to negotiate its share of the 40% revenue rights by this month, there has been mounting political pressure for progress on the Gabungan Rakyat Sabah (GRS) state government led by Chief Minister Datuk Seri Hajiji Noor.
Sabah Pakatan Harapan's Parti Upko, who are coalition partners, have accused the GRS government of failing to provide details of the claims and mechanism to the federal technical committee.
