PUTRAJAYA: The federal government is providing RM60 million in additional federal allocations for state governments, as well as 50% of tourism tax receipts.
Prime Minister Dr Mahathir Mohamad announced the provision of the extra funds today after chairing a meeting of the National Finance Council.
He said the state governments could use the money to protect their marine and forestry resources and for programmes or projects to increase their revenues.
Mahathir was asked whether Felda settlers would receive Hari Raya aid, to which he referred reporters to Economic Affairs Minister Mohamed Azmin Ali, whose ministry supervises Felda.
The prime minister was also asked about a request by Bumiputera contractors for 20% of civil works for the East Coast Rail Link project. He said no decision had been taken.
Mahathir said the extra federal allocations announced today would not have any impact on national finances, which he has consistently described as being low.
“The figure can be borne by the federal government (without burdening the state of the finance ministry’s coffers),” he noted.
“The (tourism tax) collections are actually for the federal government but we have agreed to give 50% to the state governments.”
(The tax was imposed from August 2017 and comprises a charge of RM10 per room per night on foreigners staying in hotels or private accommodation.)
The National Finance Council meeting, held at the finance ministry, was also attended by Deputy Prime Minister Dr Wan Azizah Wan Ismail, Finance Minister Lim Guan Eng and chief ministers and menteris besar or their representatives.
On aid to Felda settlers
Mahathir said it was best to ask Azmin about the matter.
“We have discussed Felda many times at other forums and we have (received) certain suggestions to better the situation at Felda,” he said.
But he told a reporter: “(You) have to ask Azmin.”
Azmin courted criticism last week when he said that Felda’s 112,635 settlers would not receive any cash gifts in conjunction with the coming Aidilfitri celebrations because of the country’s financial situation.
He said the government would instead give priority to providing Cost of Living and Advance on Produce incentives for the settlers before Hari Raya.
The Felda NGOs National Council had asked the federal government to pay “duit raya” because fluctuating palm oil prices and the rising cost of living had badly affected their income.
On 20% ECRL quota for Bumiputera contractors
Mahathir said the matter has yet to be decided. “We have determined that local contractors get placement (with regards to working on the ECRL) but whether they are Bumiputera or non-Bumiputera has not been decided,” he said.
Yesterday, the Malaysian Bumiputera Contractors Association had asked for a special quota to be created for Bumiputera contractors undertaking civil works for the ECRL. Last month, Mahathir said Malaysia’s involvement in the civil works of the ECRL project would be increased to 40% from 30%.
Govt writes off RM3.8 billion state debt for rural water supply
Mahathir said the federal government had agreed to write off RM3.8 billion in loans to state governments for rural water supply.
The amount is based on the unsettled balance at Dec 31, 2018 but is subject to state governments finalising the restructuring of water supply by the end of this year.
In future, he said, the federal government would allocate grants from the rural development ministry for water supply projects.
“It is hoped that the implementation of the write-off could speed up the restructuring of the water supply industry and reduce the annual financial burden of the states as well as ensuring that continued benefits could be enjoyed by the people in the long term,” he said after chairing the National Finance Council meeting.