State Requests For Extra NOC Project Funds Must Be Renegotiated - PM Anwar

KUALA LUMPUR, June 30 (Bernama) -- Any request by a state government for additional funding for development projects involving a Notice of Change (NOC) must be renegotiated before the Federal Government decides on any extra allocation or loan, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat today.

He said this is because an NOC carries financial implications and requires a fresh assessment of several factors, including whether the increase in project costs was caused by the contractor.

“The moment a Notice of Change is issued, it involves additional funding, and the matter must be renegotiated. First, we need to determine the contractor’s role and the root cause of the cost increase.

“Second, once additional funding is required, it involves the Federal Government, and the Federal Government cannot be bound by decisions made by state governments and automatically provide additional allocations or loans whenever costs escalate,” he said during the Minister’s Question Time.

The Prime Minister was responding to a supplementary question from Datuk Awang Hashim (PN-Pendang) on Kedah’s request for additional funding for the Pulau Bunting Water Treatment Plant project, which requires approval of an NOC.

Anwar said Deputy Prime Minister and Energy Transition and Water Transformation Minister Datuk Seri Fadillah Yusof would provide a more detailed explanation on the matter.

Meanwhile, the Prime Minister gave an assurance that the Federal Government would continue engaging with state governments while balancing revenue-sharing demands against development needs and critical infrastructure priorities.

“Revenue sharing remains subject to negotiations. If some states, such as Kelantan, Sabah and Sarawak, receive larger allocations, it is because they have urgent development requirements.

“In Kelantan, flood mitigation projects are a priority, while in Sabah and Sarawak the focus is on basic infrastructure, including highways, flood mitigation works and other projects deemed critical for development,” he said.

At the same time, Anwar said that the government is also prioritising the development of several strategic growth areas to drive the national economy, including the Johor-Singapore Special Economic Zone (JS-SEZ), Kerian in northern Perak, Kuching in Sarawak, and Sabah.

“Sarawak is making significant progress in data centres, information technology and semiconductor manufacturing through collaborations with foreign expertise. 

“Giving priority to these sectors will naturally accelerate economic growth,” he said in reply to Datuk Dr Richard Rapu (GPS-Betong) on the Federal Government’s approach to balancing state revenue-sharing demands and its strategy for driving economic growth in southern Peninsular Malaysia.

-- BERNAMA