Restructuring federal-state relations: Critical issue in next polls


Power must be devolved, decision-making must be decentralised, and development funds must be shared all the way down, asserts Francis Loh.

An important issue in the next general election, no doubt, must be the restructuring of federal-state relations. Our federal system of government needs to be transformed from a highly centralised to a more equal and co-operative one. Indeed, cooperative federal systems are the norm throughout the world, not only in Canada, Australia and Switzerland, but also in India, South Africa and Nigeria.

This means that more devolution of power must occur. As well, decentralisation of decision-making and of course disbursement of development funds from the federal government to the state governments. And the civil service must act more professionally to serve the government of the day, regardless of party affiliation.

Two years of Pakatan Rakyat (PR) rule especially in Penang and Selangor has highlighted how centralised our political system is. It has also highlighted how the BN federal government can dominate PR-led state governments as a result of the former’s control of development funds.

Whereas such funds are channelled to the state governments as in the cases of Pahang, Johore and Malacca which are BN-led, the same development funds are channelled to federal-appointed State Development Officers in the cases of PR-led states. This is so although PR state governments have been duly elected into office by the rakyat.

The recent war of words between Penang Chief Minister Lim Guan Eng and the federally appointed State Development Officer Nik Ali bin Yunus on 20-21 July over the Botanical Gardens expansion project highlights how the federal government dominates the state government.

First, the Garden’s expansion project falls under the control of the Tourism Ministry rather than the Penang state government or the Penang Municipal Council. To any Penangite, surely the state or municipal authority would be better informed of how best to carry out the expansion of the Garden!

And even if the federal Ministry was in charge, why did it not devolve power and funds to the state and local authorities? One can imagine that if the state-government was BN-led, there might have been more consultation and perhaps even decentralisation of decision-making. In this regard, we should recall how the federal government had disbursed to the BN-led Malacca state government its share of the heritage conservation funds but had denied the PR-led Penang state government its share of the same, channelling it instead to the Penang Representative Office of Khazanah Nasional Berhad, which is owned by the Finance Ministry. Yet Malacca and George Town share joint listing as Unesco heritage sites!

This episode also highlights a second way of federal domination. Lim blamed Nik Ali, who is responsible for overseeing the channelling of all federal allocations for projects in Penang, for ‘openly and blatantly sabotaging the state government’. It is significant that the SDO chose to declare the Chief Minister as ‘biadap’ at a press conference called by Penang Umno leaders! Isn’t a civil servant supposed to serve the government of the day? And in the case of Nik Ali, should he not be serving the interests of the Penang state government to which he has been appointed State Development Officer, notwithstanding he is a federal appointee?

Indeed, it is not only Nik Ali who has facilitated federal domination over Penang, the SDOs in the other PR-led states have also been giving the PR-led governments in Selangor, Kelantan and Kedah a hard time, as the Menteri Besars of those states have complained from time to time.

In this matter, we need to recall how the Pas-led Kelantan government and the Parti Bersatu Sabah (PBS)-led Sabah governments were bullied by the federal government authorities during the 1990s. Then, so-called Federal Development Offices were set up in both states in order to bypass the state governments too.

No wonder, federal appointees like Nik Ali consider it their duty to serve the BN federal government over the PR-state governments. Yet, no amount of ill-mannered name-calling by the SDO will whitewash popular opinion that most federal appointees to the state government have been acting very unprofessionally. They have been biased towards the BN government rather than acting fairly towards the PR state governments.

Underlying the recent exchange of words between the Penang CM and the SDO, therefore, is this discriminatory way by which the PR-led states are treated by the federal BN government. In effect, they have not given due recognition to the wishes of the rakyat who voted PR-led governments into office in five states in the 2008 election.

In the recent case concerning the construction of two monstrous arches at the entrance to the Botanic Gardens, which look completely out of place and one of which is tilting, there had been minimum consultation with the rakyat prior to their construction. Concerned NGOs had complained to the Penang state government about the cutting of trees, the cementing over of various parts of
the gardens to build a car park and hawker complex and the construction of the arches.

Now that the Tourism Ministry has declared that the arches will be brought down, it is clear to the NGOs and concerned Penangites that the Garden expansion project is indeed a federal project, and that the SDO does, in fact, have oversight of the project and should be held responsible for this wastage.

In this regard, perhaps the NGOs should have directed their complaints to the federal authorities in the first place. Whichever the case, there was no consultation with the rakyat by the federal Ministry of Tourism until it had become obvious that a disaster was in the making, when it was discovered that one of the ugly arches was tilting. And of course, there had been no consultation whatsoever on the part of the federal-appointed SDO even up till now. (Of course, he would plead that it is not his job to do so since he is only involved in disbursing the funds)

That said, the NGOs believe that the Penang state government could have been more pro-active and acted more responsibly in the face of such ill-conceived projects, even if they were federally funded. It could have intervened to prevent this wastage of M150,000 and the destruction of the local Botanic Garden environment. In this regard, it must share a part of the blame.

One way to prevent such wastage is to make sure that restructuring of federal-state elections become a priority for all the parties in the next elections. Power must be devolved, decision-making must be decentralised, and development funds must be shared all the way down.

Francis Loh is honorary secretary of Aliran.

  1. #1 by yhsiew on Friday, 30 July 2010 - 8:32 am

    ///Our federal system of government needs to be transformed from a highly centralised to a more equal and co-operative one.///

    The above theory sounds noble and ideal. But can the BN federal government ignore political enmity and treat Opposition led states with impartiality? That is questionable.

  2. #2 by yhsiew on Friday, 30 July 2010 - 8:44 am

    When Tun Dr. M. was in power, he said why must the federal government build roads in Opposition led states and let the electorate praise them (Opposition). I am afraid this is the mindset of the
    federal government.

  3. #3 by Bigjoe on Friday, 30 July 2010 - 9:10 am

    The issue of fedaralism vs state power is not a simplistic debate. No doubt in Malaysia, it should be better for states to have more power just from the point of opening up more opportunities to larger population.

    BUT more state powers must come with more institutional and systematic checks on state powers. Local exercise of powers because it does not get as much attention from media and population at large or a smaller local population means its actually easier to abuse. It should not be a top concern given the state of federalism now but its not something that can be assumed not an issue given our local feudal culture.

  4. #4 by HJ Angus on Friday, 30 July 2010 - 11:02 am

    “But can the BN federal government ignore political enmity and treat Opposition led states with impartiality”
    This can be done if we pass a law that states 20% of all taxes collected by the federal government will be returned to the state for its own projects and development.
    The other method is to allow states to collect state GST up to maximum of say 5%.

  5. #5 by limkamput on Friday, 30 July 2010 - 11:15 am

    We realign federal-state relation we must, but the issue does not stop there. The present system, despite power and jurisdiction skewed toward the federal government, is workable. It is the abuse of the federal power that is causing the problem. If power is devolved to the states, the same abuse may also happen if the basic checks and balance and governance principles are not there. If fact watching over the good governance of 13 states could be even more difficult and daunting that watching over one federal government. If fact, in many countries the source of vulnerability of public finance has its origin from state or provincial government. Be careful of what we ask for. There is no simple solution to a complicated problem.

  6. #6 by limkamput on Friday, 30 July 2010 - 11:19 am

    sorry, first line should be: Realign federal-state relation we must, but the issue does not stop there.

  7. #7 by monsterball on Friday, 30 July 2010 - 11:33 am

    Even if you employ the best advisers from overseas to assist and give best professional’s no use…with UMNO B government.
    Their conditions for advisers are not tom offend UMNO’s members and every advise must focus how to win votes for UMNO B.
    So the best are not qualified….but ones that can twist and juggle are most qualified.
    A joke is….Najib interviewing for an accountant.
    He asked the 1st applicant…”How much is 2+2?”
    He got a straight answer…..not employed.
    Same question to 2nd applicant…same answer.
    Same question to 3rd applicant.
    He replied…’How much do you want that to be..I can do it.”
    He got the job!

  8. #8 by frankyapp on Friday, 30 July 2010 - 12:19 pm

    The present federation of malaysia,a system rooted by the BN has failed the people and I think for malaysia to succeed in the globalised world,the federal system should be decentralised or amended to give autonomy to all states in particular by allowing each state a high degree of local authority within the federation. This also serves to avoid each and every state from being vitimised by whoever forms the federal government especially in term of the distribution of devolopment funds.

  9. #9 by dagen on Friday, 30 July 2010 - 12:38 pm

    The present system is bad. Who doesnt know? And it became bad for two reasons. (1) umno has remained in power for too long. (2) Concentration of power in the central body facilitates corporatisation of corruption – something started by dr mamak. In umno’s term, this is legalisation of corruption where bribe became commission which can be negotiated and where agreement (often styled as service agreement) would be signed.

    Decentralisation must go hand in hand with institutionalisation of the government and for that matter even the ruling political party. A working and transparent system must be hammered out and put in place to serve the nation. The system will work just the same no matter who is in control of the government or who is ruling the country.

  10. #10 by boh-liao on Friday, 30 July 2010 - 3:56 pm

    UmnoB/BN’s challenge 2 rakyat: SO WHAT? What can you do to us? We control d FED POWER!

  11. #11 by Winston on Friday, 30 July 2010 - 4:07 pm

    I think that what’s happening in Penang is a foretaste of what will happen if the PR were to win the next GE and is slated to form the next Federal Government.
    In such a scenario, the Feds will just hold on to power and defy anyone to dislodge them.
    Mark my words.

  12. #12 by lopez on Friday, 30 July 2010 - 10:15 pm

    dont try to reinvent the wheel

    gomen systems are never failsafe in spite all check and balances, we are dealing with people and if ali baba shares the loot fairly, and the orang kaya did not lock-up his daughter so feverishly and protective
    all would be well.

    and bolihland will never be but as golden chersonese.

    as a matter of fact , All MPs in the BN are not fit to be representatives of their constituency, they get confuse where their loyalty lies. ALL are clowns just more clowner that those who put them there.

    So now it is time for the SPM to delineate the constituency so that a FAIR playing field can be established…hahahahha.

    happy polling GE13

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