Sabah AG refutes claims that state was negligent in pursuing 40pc revenue claim

Sabah AG refutes claims that state was negligent in pursuing 40pc revenue claim

KOTA KINABALU, July 26 — The state government has firmly denied allegations of negligence in its ongoing efforts to secure a 40 per cent share of revenue from the federal government, refuting claims that delays were caused by late submission of its proposal.

State attorney general Datuk Brenddon Keith Soh refuted a statement from Federal minister Datuk Ewon Benedick that the state was late in sending its claims and “official proposal” on the matter.

Soh said that the state has been professional and dedicated to its pursuit over the years and outlined its many efforts to furnish the state government with information and data to claim its special grant under Article 112C and 112D of the Federal Constitution.

“The official record will show that in fact there was an initial claim in writing on June 10, 2022 that was extended to the federal Ministry of Finance (MOF) in accordance with the constitutional formula prescribed in Part IV of the Tenth Schedule of the Federal Constitution. This was in anticipation of the negotiation process being undertaken between the respective governments. The State has always been ready in this respect,” he said.

As part of the interim arrangement agreed between the state and Federal government and towards ensuring a transparent and constructive negotiation between the parties, critical financial data involving the actual revenue derived from the state was supposed to be disclosed. This includes the actual revenue obtained by the federal government from taxes, customs duties, licences, fees and fines amongst others in Sabah (“financial data”).

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“This issue was therefore brought up to the Malaysia Agreement 1963 Implementation Action Council Technical Committee (JTMTPMA63) 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,” said Soh.

Soh said that the state’s committee on this issue then prepared an updated official claim in anticipation of the negotiations to be held.

“That claim was sent to MOF on June 18 with a further letter on July 11. To date, there has not been a response in writing,” Soh stated.

“The Federal Ministry of Finance (MOF) had on July 16, 2024 confirmed in Parliament that the Federal government is committed to discuss a new special grant rate for Sabah. We therefore remain prepared, ready and able to commence further negotiations of the special grant due.

“As evidently 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,” said Soh.

Two days ago, United Progressive Kinabalu Organisation (Upko) president Datuk Ewon Benedick questioned Deputy Chief Minister I Datuk Seri Dr Jeffrey Kitingan on why the state was late in submitting its official proposal for the state’s 40 per cent revenue entitlement.

Ewon, who is part of the Malaysia Agreement 1963 (MA63) Technical Committee, said a committee meeting on May 28 this year was supposed to discuss the matter, but the Sabah Government failed to bring its official proposal.

He claimed all three Sabah deputy chief ministers were present at the meeting, and that Kitingan told those in attendance that the state’s proposal will only be submitted in June, a month before the promised July 18 deadline to settle the matter.

Sabah’s proposal was only submitted on June 18, compared to Sarawak which had done so in February, he said.

Previously, Kitingan had also criticised the Federal government for not being sincere in returning Sabah’s rights to the claim as the one-year deadline for negotiations passed last July 18.