KOTA KINABALU: The Sabah government will continue pursuing its constitutional entitlement to 40% of Federal revenue derived from the state, says Chief Minister Datuk Seri Hajiji Noor.
He said the 40% entitlement is Sabah’s most significant right under the Malaysia Agreement 1963 (MA63) and is provided for under Articles 112C and 112D of the Federal Constitution.
“The state government, under my leadership, will continue to pursue the full implementation of the 40% payment through the G2G negotiations with the Federal government.
“It is enshrined in the Federal Constitution of Malaysia. The Federal government must fulfil this right,” he said at UPKO’s 32nd Anniversary Celebration and 17th Triennial Delegates Conference at Hongkod Koisaan Hall in Penampang near here on Sunday (Aug 9).
Hajiji said the state government’s position would continue to be conveyed to the Federal government as it was at the MA63 Technical Committee meeting held in Putrajaya on Aug 3, which was also attended by Deputy Chief Minister III Datuk Ewon Benedick as part of the State Government delegation.
He said 13 claims related to MA63 have been implemented to date, including the regulation of energy, deep-sea fishing licensing and regulation, recognition of the Public Works Department (JKR), the Irrigation and Drainage Department under Treasury Instruction 182, administration of the judiciary in Sabah, administration of Sipadan and Ligitan islands, labour and the environment.
He said although the 40% entitlement has yet to be fully implemented, including with a related appeal by the Federal government before the Court of Appeal, the Sabah government has accepted an interim arrangement.
The arrangement, under which the payment was previously only RM26mil, has now been increased to RM1.5bil beginning this year.
“We welcome the Prime Minister’s decision to increase the interim payment, and we will use these funds to build more paved roads in Sabah, construct concrete bridges, improve water and electricity supplies, and implement development and welfare initiatives for the people of Sabah.
“In short, whatever we receive from the Federal government will be channelled back to the people in various forms of incentives and assistance,” he said.
Meanwhile, Hajiji said the state government continues to place strong emphasis on financial performance and increasing revenue collection.
He said annual revenue has been maintained at RM7bil since 2022 and is expected to rise to RM8bil this year.
He added that the state government has also strengthened the state’s economic resilience despite various domestic and global challenges, positioning Sabah as a strategic investment destination.
