SARAWAK MUST INSIST ON 20% OIL AND GAS ROYALTY

 

I wish to refer to the press statement by En.Chong Chieng Jen, the Chairman of Pakatan Harapan Sarawak which appeared in local newspapers on Sunday 9 September 2018.

As a Sarawakian familiar with financial aspects of government and company fundings, I am concerned with the simple minded offers made by Pakatan Harapan Sarawak to the Sarawak Government which has been published several times earlier.

The Pakatan Harapan election manifesto actually needs to be read in entirety , ie the issue of autonomy must be read together with the proposed modification in the government funding.

In this particular case, while all Malaysians may not have any problem to support the idea of a fair quatum of Petroleum Royalty to the producing states, it is an obligation for all Sarawakians to support it because it is our state’s right. Indeed, anyone claiming to be loyal to Sarawak must fight for it.

This royalty offer which actually make sense in the original election manifesto of Pakatan Harapan and BarisanNasional, have been modified after Pakatan won in the recent General Election.

It is obvious the Prime Minister Tun Mahathir, modified it not because of Petronas inability to pay out the amount, but because it has the effect of reducing Petronas contribution to the Federal Government revenue. Obviously Federal Government can hardly afford this revenue reduction after it abolished GST. Najib may not have any problem in honouring this promise with his GST still in tact if he were still in power.

But why did Encik Chong being a Sarawakian support the modification in petroleum royalty offer to Sarawak. Does he know that the modified offer based on 20% of Petronas Profit is no better than the existing 5% Royalty that Sarawak has been receiving all this while ( refer to Sarawak Tribune letter to the Editor on this matter dated 22 Aug 2018,  on this link). He should know, there is no excuse for not knowing it as the Chairman of Sarawak Pakatan Harapan.

On the other hand Encik Chong might actually know the difference in the offer quantum, but just decided to close one eye and follow his boss in Putra Jaya. If so, this is a great disappointment to all Sarawakians. The State Government since the time ofTok Nan has taken the right step to fight for our rights over Oil and Gas and Abang Jo even went further, leaving Barisan Nasional to free ourselves from the clutches of Federal politics in order to determine our own destiny. In contrast, Pakatan Harapan is working hard to bring us back to the bad old days of centralised federal politics.

The above figures point to the absurdity of Pakatan Harapan’s proposal for autonomy in education whereby the State government is to take over responsibility for all education expenditures in Sarawak.

Not that Sarawak Government does not want educational autonomy as it is Tok Nan’s idea in the first place and with it, the adoption of English as an official language and a language of education.

Now it is just the issue of funding as the point of contention, when most people are still confused having no idea how much it costs to build and run schools, colleges and universities in Sarawak. In actual fact, it is not so difficult to find out by apportionment of the Ministry’s nationwide expenditure to only cover Sarawak as follows:

.                                                                                                                         .RM BILLION

DESCRIPTION MALAYSIA TOTAL(2016)* SARAWAK ESTIMATE(2016)
Ministry of Education RM 39.6 RM 3.96 **
Ministry of Higher Education RM 11.7 RM 0.30 ***
TOTAL RM 51.3 RM 4.26

 

Note :     * Malaysian Government  Statement of Receipt and Expenditure 2016
** apportioned based on population size
*** estimated expenditure  for Higher Educational institutions in Sarawak

It is obvious from the above table that the expected 20% Gross Profit from oil and gas estimated at RM1.27 bil to RM 3.88 bil per annum can only cover the existing state government expenditure. It is grossly inadequate to cover Sarawak’s new expenditures on education of RM 4.26bil annually, in spite of its optimistic underlying assumption based on gross profit share, which is higher than the net profit share proposed by Tun Mahathir.

For the above reason, I am of the view that the State government should not agree with the profit share proposal by the Pakatan Government. We should stick to our current stand insisting on 20% Royalty which in ringgit term amounts to four times what we are receiving now.

If this is achieved we shall have no problem in exercising full autonomy in education that will propel Sarawak towards educational, technological and economic  excellence.

 

DAH IKHWAN

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