Finalise MA63 and 40% Entitlement: Bobbey

9 December 2025

KOTA KINABALU: The full implementation of Sabah’s rights under the Malaysia Agreement 1963 (MA63)—including the 40 per cent net revenue entitlement—can no longer be postponed after nearly five decades of delay, said Senator Datuk Bobbey Suan.

He said the High Court’s landmark decision in October 2025 in favour of the Sabah Law Society (SLS) should serve as the basis for restructuring the fiscal relationship between the Federal Government and Sabah.

Bobbey noted that Sabah welcomes the Federal Government’s commitment, reflected in the historic RM6.9 billion allocation for the state and the increase of the Interim Special Grant to RM600 million as part of ongoing MA63 negotiations.

He emphasised that MA63 is not merely a political demand but the very foundation of Sabah’s place within the Federation of Malaysia.

According to him, the High Court ruling, affirming the Federal Government’s obligation to honour payments under Articles 112C and 112D of the Federal Constitution—has restored public confidence in Sabah’s long-neglected rights.

“These rights were overlooked for almost 50 years without proper review or payment. This decision is not only a victory for the SLS, but a victory for the people of Sabah who have waited far too long for clarity,” he said during the debate on the Supply Bill 2026 (Belanjawan Madani) in the Dewan Negara, Kuala Lumpur on Monday.

Bobbey stressed that efforts to finalise the 40 per cent entitlement must not be prolonged any further and should be implemented through a constitutionally grounded, transparent and structured formula—complete with fixed periodic payments that do not fluctuate with changes in administration.

He added that Sabah desperately needs consistent fiscal capacity to address critical issues such as the water crisis, weaknesses in the electricity grid, rural infrastructure development, education and human capital growth.

He reminded the Senate of two major incidents in 2025 that severely undermined Sabah’s energy capacity and damaged the state’s productivity.

“First, the statewide electricity rationing in August 2025 following maintenance work at Petronas’ Kimanis Gas Terminal, which resulted in a 195 MW loss in capacity. More than 600,000 households, including 200,000 domestic users, were affected for seven days. The economic and social impact was immense—businesses stalled, hospitals operated under high risk, and daily life became extremely difficult.

“The second incident occurred on the East Coast, where the collapse of the 275 kV Kolopis–Segaliud transmission line caused major outages across Sandakan, Lahad Datu, Tawau, Semporna, Kunak and Beluran, with productivity losses amounting to millions of ringgit. These incidents show that Sabah needs a far more stable and resilient energy network,” he said.

Bobbey also welcomed the approval of the Southern Link Project under Budget 2026, involving the construction of a 330-kilometre 275 kV transmission line from Sipitang–Tenom–Kalabakan to Tawau. The project is expected to enhance East Coast energy stability by an additional 200 MW, reduce the risk of large-scale outages, and strengthen investor confidence.

“Many investors are waiting for certainty in energy supply. The Southern Link must be expedited,” he stressed.

Bobbey was also frank in criticising the implementation of federal development projects in Sabah, which he said often fail to reflect local geographical realities.

He pointed out that despite receiving substantial allocations annually, many projects fail to commence due to lengthy technical approvals, rigid tender processes and federal structural constraints that prevent timely local decision-making.

“In reality, if Sabah receives RM5 billion, only RM3 billion is actually spent. The following year we rely on new allocations to cover leftover projects,” he said.

To resolve this, he praised the State Government’s introduction of the Sabah Trust Fund, which ensures that unspent allocations do not revert to the Federal Treasury.

He proposed that all federal allocations to Sabah be channelled directly into the Trust Fund, ensuring that annual surpluses are retained and projects can be carried out continuously without administrative delays.

“If RM5 billion is allocated and RM3 billion is spent, the remaining RM2 billion stays in the fund. The next year we begin with RM7 billion. This is the most practical and fair system for Sabah.”

He also highlighted the critical issue of food security. Sabah’s Self-Sufficiency Level (SSL) stands at just 22.8 per cent, meaning nearly three-quarters of its food is imported. This dependence leaves Sabahans vulnerable to rising food prices, high logistics costs and potential shortages during global crises.

“This is not just an agricultural issue—it is a matter of cost of living and public safety,” he said, urging increased allocations for Sabah’s farmers in line with the Prime Minister’s focus on national food security.

Bobbey noted that Sabah’s tourism sector is currently at its strongest, achieving a record 3.14 million visitors in 2024—nearly double the previous year.

He added that the state now records 100 international flights per week with a capacity of 18,164 passengers, and 366 domestic flights per week with a capacity of 60,303 passengers.

He emphasised that much of this growth stems from Community-Based Tourism (CoBT), which has successfully generated rural employment, revitalised village economies, trained local communities and ensured that economic benefits reach grassroots families directly.

Bobbey also urged the Federal Government to provide a dedicated allocation to accelerate CoBT development in Sabah.

“With strong support, Sabah can become the leading model of community tourism in Malaysia—and even in Southeast Asia,” he said.

Bobbey concluded by stressing that the goals of the Madani Budget 2026 can only be realised if bureaucracy is reduced, Sabah’s rights under MA63 are fully honoured, and every allocation is implemented transparently and in the best interest of the people.