Picture Credit: Sergio Gonzalez
Sabah needs its rightful money so that it can progress reasonably and be on par with the development seen in Malaya.
Sabah was at least 20 years behind Malaya in every aspect.
PRESS STATEMENT . . .
What's important was not you, YAB Datuk Seri Anwar Ibrahim, as the Prime Minister of Malaysia.
What's important was returning the 40 per cent revenue derived by the Federal government from Sabah as provided for in the Malaysia Agreement 1963 (MA'63) and the Federal Constitution.
You had promised Sabahan umpteen times that when elected Prime Minister, you would implement fully what was agreed upon in the MA'63. Since sworn in as the Prime Minister, you have repeated again and again the promise.
The interim payment for 2025, of the 40 per cent shared revenue as stipulated in Article 112C of the Federal Constitution, would be RM600 million, as announced by Prime Minister Datuk Seri Anwar Ibrahim.
1st Review . . .
The special grants to Sabah must have its first review in 1969 which was done and the Gazetted Review Order 1970 specified the payments for five years starting from 1969 which was RM20 million. Subsequent years would be 7.5 per cent more than the preceding year, and was RM26.7 million for 1973.
2nd Review . . .
The mandatory second review was supposed to be carried out in 1974, but it did not materialise.
No Agreement . . .
In year 2019, there was meeting between the Federal government and Sabah government about the Article 112C special grants for Sabah. The Federal government offered RM53.7m for the year 2019 but this was not agreed upon by the Sabah government.
Both the Federal and Sabah governments were replaced in 2020.
April 2022 Meeting . . .
Both new governments met in April 2022 about the said 40 per cent shared revenue for Sabah.
Both governments agreed on payments for five years and the Review Order 2022 was gazetted specifying payment of RM125.6m for 2022, RM129.7m for 2023, RM133.8m for 2024, RM138.1m for 2025 and RM142.6m for 2026. The Gazette had no admission of the failure to hold the mandatory second review by 1974; meaning that there was no payment of the yearly special grants for Sabah from 1974 till 2021.
[Some lawyers say that there was payment of RM26.7m yearly from 1974, referring to Article 112D(3)].
The Review Order 2022 drew the attention of Sabah Law Society which applied in the High Court for Judicial Review on this matter, why the mandatory second review did not materialise, thus the lost 48 years of non-payment.
The interim payment of RM600m for 2025 was very small portion of the true figure of the 40 per cent of the revenue derived by the Federal government from Sabah. To illustrate a more plausible amount per year of the said 40 per cent share, a graph can be drawn for showing the amount of the yearly revenue derived by the Federal government from Sabah as shown below:
We know that the Net Revenue derived by the Federal government in 1969 was RM50m (knowing that the 40 per cent was RM20m); and in 2023 the Net Revenue was RM10.2b, as disclosed by PMX on 4 August in Kota Kinabalu.
From the Graph, the Net Revenue derived by the Federal government from Sabah for any year starting from 1974 till 2023 can be extracted.
For example, the extracted estimates of the said Net Revenue would be RM2b, RM4b, RM6b, RM8b and RM10b for year 1980, 1990, 2000, 2010 and 2020 respectively.
If RM2b was the extracted value of the said Net Revenue for the year 1980, then, RM800 million was the 40 per cent that should have been returned to Sabah for that year. Since this was not returned to Sabah, the amount owed to Sabah by the Federal government (for the year 1980) by the year 2024 (44 years later) would be
RM800m x (1+0.05)^44 = RM6.845b
[(0.05) is the statutory interest of 5 per cent per year in decimal point.]
Similarly, for the year 1990, if RM4b was the extracted value of the said Net Revenue, RM1.6b would be the 40 per cent that should have been returned to Sabah for that year but did not happen. Therefore, 34 years later the amount owed by the Federal government for the 1990 non-payment would be
1990: RM1.6b (1+0.05)^34 = RM8.405b
From similar calculation for years 2000, 2010 and 2020, the amount owed would be RM7.740b, RM6.336b and RM4.860b respectively.
For the 5 years, (1980, 1990, 2000, 2010 and 2020), the total amount owed to Sabah would be RM34.186b.
From year 1974 to 2023 inclusive, it's 50 years. It can be deduced that the amount due to Sabah by the end of 2023 was RM341.86b.
Sabah needs its rightful money, the 40 per cent shared revenue, apart from the Federal allocations, for Sabah’s own development, so that it can progress reasonably and be on par with the development seen in Malaya.
Sabah was at least 20 years behind Malaya in every aspect.
This Press Statement was prepared by Dr Chong Eng Leong, consultant general surgeon, and author of “Population Explosion and Demographic Shift in Sabah”.
The Press Statement first appeared here . . .
https://murrayhunter.substack.com/p/the-interim-payment-of-rm600-for
DISCLAIMER: The views expressed in this Press Statement do not necessarily represent those of the Center for Policy Initiatives (CPI).
Related Internal Links . . .
http://www.cpiasia.org/index.php/268-e-media/2653-40-the-reason-sabah-agreed-to-malaysia
