SABAH’s interim special grant has been increased from RM600mil to RM1.5billion while negotiations on the state’s 40% revenue entitlement enter the final stages, says Prime Minister Datuk Seri Anwar Ibrahim.
Announcing the increase during the state-level Kaamatan celebration in Penampang on Friday (May 30), Anwar reiterated that Putrajaya remained committed to fulfilling Sabah’s constitutional right to the 40% special grant.
He stressed that the issue was no longer about policy but about working out the implementation mechanism between the Federal and Sabah governments.
“The issue is not the policy. For the first time, the Madani government under my leadership has established a ‘no argument’ position. It is a policy that must be implemented,” he said.
Anwar said discussions were now focused on how the payment should be structured, noting that any decision would have implications not only for Sabah but also for Sarawak and other states.
“When discussing state rights and the Federation Agreement, it is not as simple as applying Article 112D and calling it a day.
“Every decision we make has direct implications for Sarawak and other states. I am not using this as an excuse to reject it. I am only explaining the realities of Malaysia and its diversity,” he said.
The Prime Minister said the Federal Government had already instructed senior officials from both sides to work out the details before the matter is brought to the Cabinet and the Sabah government for final consideration.
Pending a final agreement, he announced that the interim special grant would be increased from RM600mil to RM1.5bil. “I stress that this is an interim measure because the matter still has to be finalised,” he said. Anwar dismissed claims that Sabah continued to be treated as a “stepchild” within the federation.
He said while the state’s right to the 40% entitlement could not be denied, it was inaccurate to suggest that federal revenues collected from Sabah were not being channelled back to the state.
Anwar said Sabah contributed about RM10bil in federal revenue last year, while total federal expenditure and development allocations for the state reached RM17bil.
However, he stressed that the figures should not be interpreted as a reason to deny Sabah’s constitutional entitlement. “Can we deny Sabah’s right to the 40%? No, because it was a promise made in 1963.”
Anwar said the government could also no longer rely on financial constraints under Article 112D as a reason to delay implementation, adding that the commitment to fulfil the constitutional provision remained unchanged.
He said discussions involving the Federal Treasury, Finance Ministry and Sabah government were ongoing and expressed confidence that a framework could be finalised within the next few months.
