PETALING JAYA: The government respects the Kota Kinabalu High Court’s decision on Sabah’s entitlement to 40% of federal revenue and would study the ruling before taking further action, said Prime Minister Datuk Seri Anwar Ibrahim.
He said Putrajaya would decide whether to appeal the decision after obtaining advice from the attorney-general, stressing that the matter remains under judicial consideration.
“The Madani government respects the judicial process and would examine the written grounds of judgment once received before taking any further action, for the good and interest of Sabah and Malaysia,” he said in Parliament yesterday.
Anwar said the Sabah High Court’s ruling, delivered on Oct 17, directed the federal government to conduct a review with the state government under Article 112D of the Federal Constitution to give effect to the 40% special grant entitlement.
He clarified that the decision did not contradict his previous statements, noting that it highlighted shortcomings of past federal administrations when current opposition members were in power.
“The decision also made observations towards the federal government when the honourable members opposite (the opposition) were ministers. Let us not forget that.”
While awaiting legal developments, Anwar said the federal government would continue to uphold its obligations to Sabah under the Constitution and strengthen cooperation through the Malaysia Agreement 1963 (MA63).
He said the Madani government has resolved 13 MA63-related demands, including transferring regulatory authority over electricity and Sabah Electricity Sdn Bhd to the state government.
“Although authority has been transferred, the government continues to provide RM1.2 billion to ensure a stable power supply in Sabah,” he said.
Other achievements include recognising the Sabah Public Works Department, Department of Irrigation and Drainage and Sabah Water Department as technical departments under Treasury Instruction 182, enabling them to approve federal projects worth up to RM50 million.
On the special grant, Anwar said reviews were conducted and gazetted in 2022 and 2023, and would continue until this year, in line with Article 112D.
He said the annual grant for Sabah has increased from RM26.7 million before 2021 to RM53.4 million in 2019, RM125.6 million in 2022 and RM300 million in 2023.
“Under the Madani government in 2025, the grant has again been raised to RM600 million, compared with only RM27.7 million when the opposition was in government,” he said, adding that the full amount was paid in September.
Anwar said the figure remains interim as both governments work on a new formula for future calculations.
He added that federal allocations to Sabah rose from RM13 billion in 2022 to RM17 billion under Budget 2025 and 2026, exceeding total revenue collected from the state.
“The Madani government has spent more in Sabah than the revenue collected, reaffirming our commitment to the state’s development.”
