Prime Minister Anwar Ibrahim is set to address Parliament tomorrow to explain the government’s decision not to appeal the Kota Kinabalu High Court ruling on the special grant based on Sabah’s 40% revenue share, as provided under the Federal Constitution.
Anwar, who also serves as finance minister, said his clarification would cover the decision regarding the appeal and address concerns about perceived flaws in the court’s judgment.
He explained that the decision was reached by consensus following a special Cabinet meeting to deliberate the matter.
“After hours of discussion during yesterday’s special Cabinet meeting to review the Kota Kinabalu High Court judgment, we reached this decision, taking into account the views and proposals of each Cabinet member,” he said at a monthly gathering of the Prime Minister’s Department.
Following the government’s decision, the Attorney-General’s Chambers (AGC) announced that negotiations with the Sabah government would begin immediately. The AGC stressed that the federal government respects the principle of the 40% special grant enshrined in the Federal Constitution.
At the same meeting, the attorney-general also presented advice regarding several perceived defects in the court’s reasoning, including claims that both the federal and Sabah governments had allegedly abused their powers and breached constitutional obligations dating back to 1974. The AGC noted that the judgment stated the post-2021 revenue review was unlawful, irrational, and disproportionate.
On October 17, the Kota Kinabalu High Court ruled that the federal government acted unlawfully and beyond its constitutional powers by failing to uphold Sabah’s right to 40% of federal revenue from 1974 to 2021.
Justice Celestina Stuel Galid described the special grant agreement between the federal and Sabah governments as “invalid, ultra vires, and irrational,” and in breach of the Federal Constitution.
The court issued a mandamus order directing the federal government to conduct a revenue review with Sabah under Article 112D of the Constitution to reinstate the state’s 40% revenue share for each financial year from 1974 to 2021. The review must be completed within 90 days, and both governments are required to reach a mutual agreement within 180 days of the October 17 ruling.
