Fri, 22 Sep 2023


The reality of a RM6.5 billion federal grant
Published on: Sunday, March 19, 2023
By: Datuk John Lo
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The natural reaction of many Sabahan is elation that the federal government has given Sabah a larger grant in the budget to the amount of RM6.5. Datuk Jeffry was quick to pull us back to the stark reality. The additional sum is delusionary and does not represent an increase. 

It characterizes a very serious setback for Sabah and grievous fault in the decades-long entrenched inferior treatment of Sabah by the federal government. The federal government is not that generous. It has never been. The extra amount is to cover for project funds that have been unutilized or could not be spent due to [according to Jeffry] excessive bureaucracy.

Jeffry is right to remind the federal government that Sabah political leaders and all Sabahans what really matters is the 40pc due to Sabah under MA63. This should be reflected in the federal budget. This is a Sabah’s right, not a gift or grant. Sabahans should and must continue to press for this rectification.

I fail to see the delay or complication in the calculation of this 40pc as the federal government should/must have all the figures at its finger tips. Very serious failure in management by the federal government, if it does not have them. How can it manage the economy? 

Why can’t Sabah complete spending the federal grant?

In 2022, Sabah could only implement 45pc of federal allocation of RM5 billion according to Masidi. To the uninitiated, spending money is the easiest thing to do. In contrast, earning money is tough especially in this competitive world. Here are some implementation obstacles that I have been able to glean from conversations with people in the know.

[a] The mother of all bureaucratic hurdle is the methodology and snail speed of disbursement of the allocation from the federal ministry of finance. Once Parliament has approved the budget in November, it takes months for the funds to reach Sabah, leaving insufficient time for the Sabah Government to do the necessary for implementation. The time frame for 2023 is worse as the budget has been re-tabled in February. There is hardly any time left for implementation before the next budget in November this year.

[b] From the time the funds arrive in Sabah, to preparations, tenders, documentations, processing, negotiation, to final decisions to award, letter of award can take many more months.

[c] Then the contractors will need time to arrange finance, mobilization [especially workers] and sourcing of materials. Very common at the time when they are ready to “break ground” it is already approaching year end. Impossible to make much construction progress.

[d] Then the federal government regulations compel the unutilized portion to be repatriated back to federal government. Need to remind that 55pc of the so-called grant has to be returned to federal government in 2022. I shudder to estimate what will the pc of implementation be in 2023, given the shortened time for implementation.

[e] This mickey mouse of this vicious circle has perpetuated since time immemorial. The fundamental problems are with the federal ministry of finance and to a certain extent, Sabah side must bear responsibility. Systemic delays are common in Sabah. Extreme slowness in implementation of policies for the benefit of Sabahans is common. 

Sense of urgency is a rarity, like a double blue moon. Sabah’s side needs a major revamp. Hence Masidi’s suggestion for Sabah to set up a trust fund for the unutilized portion of the grant makes excellent sense. No reason it can’t be implemented. It will smoothen project implementation, better management of cash flow for all stakeholders, especially the contractors.

The federal government [Ministry of Finance] and the Sabah government should consider stopping the woefully outdated, faulty implementation system. Take the cue from the PM Anwar’s transformation in his eradication of corruption in the tendering process. No rocket science to improve the present system.

Sabah needs more economic warriors.

Thanks to Hajiji, he has straightened out the state/federal relationship in many aspects. For years, this relationship is like taiko/machai in which Sabah has to kowtow lowly, sometimes knees down to the floor for what should be rightfully ours. He has shown the way to regain many Sabah’s rights. 

Masidi has been watching over Sabah’s oil and gas and related collection of outstanding sales tax like a hawk. He has managed to retrieve about RM100 million outstanding taxes. 

To do this, he has put his foot down on a recalcitrant company which refused to pay sales tax.  Jeffry has been outspoken on the unfair treatments of the federal government in Sabah’s MA63 rights which is bearing fruits.

Sabah can do with many more economic warriors from among economic conscientious Sabahans to support Hajiji, Masidi and Jeffry who have been sorting on economic problems for Sabah.

How to become Sabahan economic warriors? 

I am deeply gratified to see the increasing number of political leaders speaking out on economic matters for Sabah. We need more, many more.

No Dun or MP in Sabah can be an economic warrior by “mengarut” politicking. To be an economic warrior for Sabah will require commitments and intimate economic knowledge, facts and figures.

[a] Foremost, political leaders must prove they have dedication and commitment to improving the economic status of their constituents. This they can do by reducing politicking by 90pc and increase 1000pc [yes, I mean one thousand-percent] in improving their quality of economic leadership. 

Work with them, mix with them, talk to them about their economic problems, show them that hard work can pay good dividends. Teach them how to put better food on the table, build better homes for their families and encourage their children to strive for higher education. Be with them 90pc of the time. Live among them. 

A true economic leader is a crusader for the rakyat. Xi Jinping has done all these starting as a young politician. That’s why he is such a great leader. He enjoys highest satisfaction rating [consistently at high 80pc and over 90pc] in the world among leaders among the developed countries.

[b] Have an in-depth knowledge on the economy of the constituency, Sabah and a good working knowledge of Malaysia’s economy. The first is to be able to represent your constituency effectively, to fight for Sabah’s economic growth and protect Sabah’s right in Parliament and State Assembly. No Dun or MP can be effective in his/or her jobs without a good grounding of economics. Present excessive politicking is killing Sabahans’ economic future.

[c] It is quite easy to produce a sizeable corps of Sabah economic warriors from among Sabah 79 Dun and 25 MPs as all of them are well educated. All that is needed is a mindset change for them to focus on the fight for their constituents’ economic future, for solutions of Sabah’s many economic problems. Make it their political mission to empower Sabahans to work for a better quality of life..

Fighting for Sabah’s economic progress is the responsibility of every Sabah’s middle class, professionals, businessmen and economic related NGOs

I appeal to Sabah’s middle class, professionals, businessmen and economic related NGOs to become economic warriors for Sabah. If there are many more Sabahans who can answer to this economic warrior call, Sabah can expedite economic progress, Sabah will have a better chance to catch up. 

A concerted effort on economic development will produce political stability, unity of purpose to fight for the improvement of Sabah’s economy. Political stability is critical for the acceleration of economic development as has happened in Singapore and China. 

Why must middle class, professionals, businessmen and economic related NGOs become economic warriors for Sabah? Because they have the most to lose. The very rich will stay rich, the poorest will remain poor no matter what happens if there is no economic improvement. 

They are the most vulnerable and have the most to lose in a badly managed economy i.e., their life style, standard of living, their diminishing asset value, eaten up by inflation and their children’s future, especially those studying overseas. Fees are expensive.

What can they do? 

First, stop being an armchair critic, whispering juicy gossips in coffee shops [real and fake ones].

Second, these Sabahans, being the most educated and professionally qualified, can quite easily discern good from bad policies/decisions. They can/should speak out on these policies/decisions to their Duns or MPs. It is in their interest to do so.

Third, being armed with good education and professional qualification, they should be able to organise themselves to produce alternative policies and/or recommendations for the good of Sabah.

Lastly, there are already Sabahans benefitting from the present economic restructuring in the oil/gas industry and implementation of several major investment by Hajiji. There should be many more Sabahans looking into these opportunities. Please do not wait.

Middle class Sabahans should fight for the control of our economic destiny. This will not happen by complaining. All Sabahans must act with one united endeavour to regain and take charge of our economy.

- The views expressed here are the views of the writer Datuk John Lo and do not necessarily reflect those of the Daily Express.

- If you have something to share, write to us at: [email protected]


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