PH did not promise oil royalty increase unconditionally – Chong

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 Chong, flanked by PH Sarawak leaders, reads excerpts from the agreement during the press conference.

KUCHING: Pakatan Harapan (PH) did not promise an increase of oil royalty from the present five per cent to 20 per cent unconditionally.

In pointing this out today, PH Sarawak chairman Chong Chieng Jen said the Sarawak government would have to assume fiscal responsibility in education and health in order to receive the 20 per cent oil royalty.

He reminded all that PH had offered was an agreement to the state ruling coalition – then Barisan Nasional (BN) Sarawak and now Gabungan Parti Sarawak (GPS) – before the 2018 general elections.

In that agreement, he said it was clearly stated under ‘Fiscal Decentralisation: Taxation & Public Revenues’ that PH would give 20 per cent oil and gas royalties or value equivalent as well as 50 per cent of all tax revenues collected in Sarawak back to the state if Sarawak took over autonomy in education and health.

“But Abg Jo (Chief Minister Datuk Patinggi Abang Johari Tun Openg) and GPS rejected this offer. They want the 20 per cent (oil royalty) to be used by them to their whims and fancies.

“That’s not what we offered and agreed. And Abg Jo has taken upon himself to negotiate with PM (prime minister). We don’t know why he (Abang Johari) rejected the offer,” he said after chairing the PH Sarawak meeting held at Democratic Action Party (DAP) headquarters here.

Chong, who is Deputy Minister of Domestic Trade and Consumer Affairs, stressed that the 50 per cent tax revenues and 20 per cent oil and gas royalties were ‘tied in together with education and health autonomy’.

He read out an excerpt from the agreement: “The Government of Sarawak shall use these funds (50 per cent of tax revenues and 20 per cent oil and gas royalties or value equivalent) to shoulder the fiscal responsibility of the Federal Government in EDUCATION and HEALTH.”

“The ball is now in the court of Abg Jo. He wants to negotiate with PM, that’s his decision and the mandate of Sarawakians given to him,” he said.

According to Chong, the Sarawak government was not asking for devolution of education autonomy from the federal government.

Given this, he said all the concern raised by GPS leaders on education issues ‘is playing to the gallery’ since they had no intention to have autonomy in education.

He said PH did not ditch their offer because it was GPS which rejected it.

On a note that Abang Johari said that he had submitted a new formula to Putrajaya, he responded: “It’s between him and PM.”

Chong said the agreement was not hastily done as PH had carried out studies and negotiations as well as obtaining feedback from the oil and gas sector.

On ‘value equivalent’, he said there was concern by the oil and gas sector that they might not be able to pay the amount as they could not predict the world crude oil price.

“Let’s say if the value is RM5 billion, and if they cannot pay, then the federal government will top up, this is value equivalent,” he explained.

At present, the five per cent oil and gas royalties to Sarawak is about RM1.5 billion a year.

Chong said a rough calculation indicated that the Sarawak government would receive about RM8 billion a year to take over autonomy in education and health.

“The expenditure on education and health is seven point something billion,” he added.