Friday, June 5

Revenue re-engineering to boost income


CM: Local authorities must take cue from state government on know-how to generate funds

Abang Johari (centre) shares a light moment with Jaul as Local Government and Housing Minister Dato Sri Dr Sim Kui Hian looks on.

PORT DICKSON: Municipalities and local councils should be able to increase their revenue if they can capitalise on the myriad of services they provide to the public, said Chief Minister Datuk Patinggi Abang Johari Tun Openg.

Speaking when officiating at the closing of the High Performance Team (HPT) Retreat here yesterday, he said it was important for local authorities to understand how revenue can be derived from the various forms of services provided at their level.

However, he said any form of council tax and levies must be done gradually, and the amount charged or increased must be reasonable, so as not to burden the people and taxpayers.

Describing the process of collecting income from various sources and consolidating them into the revenue of local authorities as ‘revenue reengineering’, the chief minister said the Sarawak government has had to undergo the same process to increase the state’s revenue from potential sources based on the law.

He cited the sales tax on petroleum and gas products for export from Sarawak as an example of ‘revenue engineering’, saying the imposition of the tax in accordance with the power provided by the Federal Constitution to Sarawak was able to provide the state with an additional revenue of RM3 billion.

Abang Johari said alternative sources of funding provided by the Sarawak Development Bank (DBOS) was another example of how reserved funds could be used to fund strategic development programmes without diminishing the state’s reserves.

He said specific projects like water supply and provision of infrastructures had the potential to expand the economy and generate revenue that would be paid back to the bank, thus enabling the government to recoup the amount lent to the bank.

He also pointed out that proper planning of towns to turn them into vibrant commercial centres was also vital to enable local authorities to enlarge their revenue base.

Taking the satellite town of Sibu Jaya in Sibu as an example, he said the town was initially not able to grow well but after a redesign to allow for commercial growth, Sibu Jaya became ‘alive’.

He added that a planned alternative road access from Sibu should add further steam to the growth of Sibu Jaya.

On another matter, he said the Sarawak government’s proposal to set up an airline service to increase air connectivity to the state would not involve any purchase of aircraft.

Drawing example from his experience, the chief minister said Sarawak had the choice of leasing the aircraft as this would provide a more viable option compared to buying them.

He said direct services from overseas to Kuching would be more convenient for tourists and with proper promotion and image-building overseas, Sarawak’s tourism potential could be well-exploited.

Earlier at the retreat, State Secretary Datuk Amar Jaul Samion delivered a presentation of the findings and recommendations of the various labs to the chief minister.

About 200 heads of departments, senior officers, mayors, council heads and councillors attended the four-day retreat, which is an annual programme of the Sarawak civil service.

This year’s HPT, themed ‘Empowering Local Authorities for the Implementation of Smart Government Initiatives’, was specifically to deliberate on ways to upgrade the quality of services of local authorities for the benefit of the people.

The retreat was also attended by state ministers and assistant ministers.