The interim payment of RM600 for 2025 to Sabah
From year 1974 to 2023 inclusive, it is 50 years. It can be deduced that the amount due to Sabah by the end of 2023 is RM341.86 billion.
Dr Chong Eng Leong
The interim payment for 2025, of the 40% shared revenue as stipulated in Article 112C of the Federal Constitution, would be RM600 million, as announced by Prime Minister Datuk Seri Anwar Ibrahim yesterday.
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% more than the preceding year, and it be RM26.7 million for 1973.
The mandatory second review was supposed to be carried out in 1974, but it did not materialise.
In year 2019, there was a meeting between the Federal Government and Sabah State Government about the Article 112C special grants to Sabah. The Federal government offered RM53.7 million for the year 2019 but this was not agreed upon by Sabah Government.
Both the Federal and Sabah governments were replaced in 2020. Both new governments met in April 2022 about the said 40% shared revenue for Sabah. Both governments agreed to payments for five years and the Review Order 2022 was gazetted specifying payment of RM125.6 million for 2022, RM129.7 million for 2023, RM133.8 million for 2024, RM138.1 million for 2025 and RM142.6 million 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 to Sabah from 1974 till 2021.
[Some lawyers say that there was payment of RM26.7 million yearly from 1974, referring to Article 112D(3)].
The Review Order 2022 drew the attention of Sabah Law Society which applied to the High Court for a 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 RM600 million for 2025 is a very small portion of the true figure of the 40% of the revenue derived by the Federal government from Sabah. To illustrate a more plausible amount per year of the said 40% share, a graph can be drawn to show 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 RM50 million (knowing that the 40% was RM20 million); and in 2023 the Net Revenue was RM10.2 billion, as disclosed by PMX 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 2 billion, 4 billion, 6 billion, 8 billion and 10 billion for year 1980, 1990, 2000, 2010 and 2020 respectively.
If RM2 billion was the extracted value of the said Net Revenue for the year 1980, then, RM800 million is the 40% 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
RM800 million x (1+0.05)44 = RM6.845 billion
[(0.05) is the statutory interest of 5% per year in decimal point.]
Similarly, for the year 1990, if RM4 billion was the extracted value of the said Net Revenue, RM1.6 billion would be the 40% 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: 1.6 Bil (1+0.05)34 = RM8.405 billion
From similar calculation for years 2000, 2010 and 2020, the amount owed would be RM7.740 billion, RM6.336 billion and RN4.860 billion respectively.
For the 5 years, (1980, 1990, 2000, 2010 and 2020), the total amount owed to Sabah would be RM34.186 billion.
From year 1974 to 2023 inclusive, it is 50 years. It can be deduced that the amount due to Sabah by the end of 2023 is RM341.86 billion.
Sabah needs its rightful money, the 40% shared revenue, apart from the Federal allocations, for Sabah’s own development, so that Sabah can progress reasonably to be on par with the development seen in Malaya. Sabah is at least 20 years lacking behind Malaya in every aspect.
What is important is not you, YAB Datuk Seri Anwar Ibrahim, as the Prime Minister of Malaysia. What is important is returning the 40% net revenue derived by the Federal government from Sabah as provided for in MA63 and the Federal constitution. You had promised us Sabahans umpteen times that when elected the Prime minister, you would implement fully what is agreed upon in the MA63. Since sworn in as the Prime minister, you have repeated again and again the promise.
Dr Chong Eng Leong
Former PKR politician, medical practitioner, and author of “Population Explosion and Demographic Shift in Sabah”. Dr Chong lives in Sabah.
