Distribution Of Federal Allocations Based On Needs, Not Tax Revenue - PM Anwar

KUALA LUMPUR, June 30 (Bernama) -- Prime Minister Datuk Seri Anwar Ibrahim stressed that almost all states received higher allocations from the federal government compared to their tax revenue contributions, except for Selangor and Penang,  which recorded higher revenue collection.

He said the allocations were made based on development needs and the well-being of the people, thus rejecting claims that certain states were being ignored or marginalised.

Anwar said the government determined the allocations based on the urgent needs in each state, including flood mitigation projects, upgrading the Pan Borneo highway and new roads, water drainage systems, poverty eradication and the development of schools and other infrastructure facilities.

“If I want to compare, I want to emphasise here that it is the MADANI Government that provides the highest allocations for states such as Kedah, Terengganu and Kelantan, compared to the previous one,” he said during the Ministerial Question Time session at the Dewan Rakyat today.

He was responding to a question from Datuk Seri Doris Sophia Brodi (GPS-Sri Aman) regarding allegations that the federal government's allocation to state governments is unfair and insufficient compared to the revenue collected, in addition to the efforts of the MADANI Government in improving the distribution of these allocations.

Anwar said for the period 2023 to 2025, Selangor contributed RM43.6 billion in tax revenue to the federal government, while the federal expenditure in the state amounted to RM15 billion.

For Penang, he said, the average revenue contributed to the federal government in the same period was RM10.7 billion, while the expenditure in the state amounted to RM7.9 billion.

He said that for other states, the total federal expenditure was much higher than the tax revenue contributed.

According to him, for the period 2023 to 2025, Kelantan recorded an average revenue of RM946 million with federal expenditure reaching RM8.9 billion, while Kedah recorded a revenue of RM3.7 billion with an expenditure of RM9.5 billion.

For Terengganu, he said, the revenue received by the federal government, including petroleum revenue, was about RM2 billion, while the federal expenditure amounted to RM7.8 billion, and Johor recorded a revenue of about RM14 billion with a federal expenditure of RM16 billion.

Meanwhile, in response to Doris Sophia's supplementary question on the special grant to Sarawak, Anwar said negotiations were still ongoing in line with the spirit of the Malaysia Agreement 1963 (MA63).

He explained that the matter was not announced during his recent meetings with Sarawak Premier Tan Sri Abang Johari Tun Openg in Bintulu and Kuching, as the government had prioritised resolving issues related to the handover of Bintulu Port to the Sarawak government and the payment of RM1.8 billion by Sarawak to the federal government, a development he described as unprecedented.

“I have given assurances that negotiations are continuing and that an increase should be granted based on the spirit of MA63. Therefore, this will be approved as soon as possible,” he said.

At the same time, the prime minister described the handover of Bintulu Port to the Sarawak government as a milestone worth celebrating, noting that it marked the first time in history that a solution was achieved through negotiations recognising the state’s rights under the Constitution.

“This is the first time in history that negotiations have fulfilled constitutional requirements in recognising the rights of states in matters concerning ports, and it symbolises the importance of conducting constructive and healthy negotiations,” he said.

-- BERNAMA