Malaysia

UCLG COUNTRY PROFILES Malaysia Capital Population Area

: : :

Kuala Lumpur 28,728,607 (July 2011 est.)

329,847 sq km

1. Introduction

1.1 General Information Malaysia is situated in Southeast Asia with neighboring Thailand to the north and Singapore on the south. It covers an area about 330,252 square kilometers with population around 28 million people.

Malaysia consists of 13 states1. Other than the 13 states, Malaysia also has Federal Territories encompassing Kuala Lumpur, Labuan and Putrajaya. The capital city of Malaysia is Kuala Lumpur while Putrajaya is the seat of the Federal Government. Malaysia is a multi-ethnic country. The principal ethnic groups are Malay, Chinese and Indian. Other significant groups include Kadazandusun, Bajau, Rungus, Murut, Dayak and Melanau.

1.2 Political system Malaysia practices a system of Parliamentary Democracy with Constitutional Monarchy and the Yang di-Pertuan Agong is the head of the Country.

It has three branches of government, namely The Executive, The Legislature and The Judiciary. The Malaysian Parliament is made up of Yang di-Pertuan Agong, Dewan Negara or The Senate and Dewan Rakyat or House of Representatives.

1 Johore, Kedah, Kelantan, Malacca, Negeri Sembilan, Pahang, Penang, Perak, Perlis, Selangor, Terengganu, Sabah dan Sarawak.

Dewan Negara consists of 70 members, 26 are elected by the State Legislatures while the remaining 44 members are appointed

by Yang di-Pertuan Agong on the advice of the Prime Minister. A total of 222 members of Dewan Rakyat are elected from the general election which was held every five years. The leader of the largest political party in the Dewan Rakyat shall be the Prime Minister, head of the government.

The members of cabinet are appointed by the Prime Minister from members of parliament with the consent of Yang diPertuan Agong.

2. Territorial Organisation

Malaysia is based on a three-tier governmental system which is the Federal Government, the State Government and the Local Government or the local authorities. Since independence Malaysia has been governed by a multi-party coalition known as the Barisan Nasional. To ensure a smooth and systematic administration, the Government established 25 federal ministries with specific portfolios and responsibilities. One of the 25 federal ministries is the Ministry of Housing and Local Government (MHLG), which is wholly responsible for the development of local authorities in Malaysia. This is done by various departments under MHLG particularly the Local Government Department with the assistance of other departments such as the Town and Country Planning Department and the National Landscape Department.

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Table1: LOCAL AUTHORITIES IN MALAYSIA

3. Local Democracy 3.1. Local Political System Local authorities are placed under the State Government as stipulated in Item 4, List 2 of the 9th Schedule of the Federal Constitution.

Although local authorities are within the purview of the State government, Article 76 (4) of the Federal Constitution has empowered the Parliament to legislate laws and policies related to local authorities.

Article 95(A) of the Federal Constitution has consented for the establishment of the National Council for Local Government (NCLG) as the highest policy making body for local authorities. NCLG was chaired by the Deputy Prime Minister of Malaysia and its members consist of Chief Ministers from all the State Governments and several relevant Cabinet Ministers. Meetings are convened at least once a year and the MHLG acts as the secretariat for the meeting.

The relationship between the Federal Government and the State Government as per the establishment of NCLG as are per table 1.

Due to issues security, there have not been local government elections since 1964. The current local government laws do not dictate the need to hold elections at the local authority level.

City Councils are headed by Mayors and the Municipal and District Councils are headed by Presidents, both of which are appointed by the State Government from among the civil servants.

Each State Government also appointes a number of Council to assist the Mayors or President to execute its executive powers.

3.2 Council Structures Councilors from the local authorities are appointed from among the residents of the local authority area. A majority of them are ordinary residents in the local authority area who, in the opinion of the State Government posses wide experience in local authorities

City Councils

Municipal Councils

District Councils

Total

State Johore

1

6

8

15

Kedah

1

3

7

11

Kelantan

-

1

11

12

Malacca Negeri Sembilan

1

3

-

4

-

3

5

8

Pahang

-

3

8

11

Perak

1

4

10

15

Perlis

-

1

-

1

Penang

-

2

-

2

Selangor

2

6

4

12

Terengganu Kuala Lumpur (FT)

1

2

4

7

1

-

-

1

Sarawak

3

3

20

26

Sabah

1

2

21

24

12

39

98

Total :

affairs or have achieved distinction in any profession, commerce or industry and capable of representing the interests of their communities in the local authority area.

The term of office of each Councilor shall not exceed three years and is eligible for re-appointment upon the expiry of his term of office.

3.3 Local Government Staffing Other than the Mayor and President, all other staff of the local authority is appointed by the local authority themselves. Prior to the appointment, local authorities would need to seek the consent of the State Government for the list of employment for appointment of staff and their proposed salary. As at 1st January 2008, total number of staff employed at local authorities for the whole of Malaysia is 43,035 people.

3.4 Independent Scrutiny Act 171 empowers the Auditor General or any other auditors appointed by the State II

149

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government based on the recommendation of the Auditor General to scrutinize the accounts of local authorities. The audit of accounts of local authorities is to ensure that local authorities manage and utilize its revenue in a regulated and prudent manner while adhering to every law and financial regulations.

4. Supervision by central government 4.1. General Issues Local authorities in Malaysia are divided into City Councils, Municipal Councils and District Councils. City Councils are the state administrative centres with a population of not less than 500,000 people, with annual revenue exceeding RM100 million and consist of complete infrastructure facilities and public utilities. Meanwhile, the Municipal Councils are the main towns or the central administration of a state or district, with a population of not less than 150,000 people, with annual revenue exceeding RM20 million and has the capacity to provide adequate and convenient services to improve the quality of life to a city. The District Council is other than the main cities with a population of less than 150,000 people, with annual revenue not exceeding RM20 million and caters to the needs of its community focusing on infrastructure facilities and public utilities rather than urban services.

Nevertheless, the District Councils can be upgraded to Municipal Councils and Municipal Councils can be upgraded to City Councils provided if it able to fulfill all the necessary requirements. The total number of local authorities in Malaysia is 149 as detailed in the table below.

Other than the 149 local authorities above, Malaysia also has 5 agencies which were provided with the authority to exercise the functions of local authorities for selected areas such as Putrajaya Corporation and Labuan Corporation in Federal Territory of Kuala Lumpur, Johore Tenggara Town Board in the state of Johore, Kulim Hi-Tech Industrial Park Local Authority in the state of Kedah and Tioman Development Board in the state of Pahang.

The Malaysian Association of Local Authority (MALA) and the Amalgamated National Union Local Authorities Employees (ANULAE) are the 2 main associations related to local authorities in Malaysia.

MHLG also cooperates with both entities in its effort to further improve the services delivery system of local authorities.

4.2. Supervision of Local Government The relationship between the Federal Government and the State Government in relation to local authorities are always reenforced through the NCLG. This is due to the fact that all policies, laws and improvements related to local authorities has to be agreed upon at the NCLG meetings prior to its implementation by each local authorities. In addition, MHLG holds dialogue sessions and meetings with all State Governments and local authorities from time to time to further explain on the policies decided by the Federal Government and to gain feedbacks for further improvement.

5. Local government responsibilities The primary role of local authorities is to provide a healthy, comfortable and safe environment, through the allocated existing laws in fulfilling the need of the communities while stimulating development and economic growth within their jurisdiction. This encompass services such as the approval of license and development plans, providing and maintain infrastructure, facilities and public utilities; providing housing, industrial, commerce and tourism zones; providing market and small traders area; providing recreational spaces public parks and others.

Beginning in June 2009, the services related to solid waste management and public cleansing which was previously undertaken by local authorities, was handed over to the Federal Government through the establishment of National Solid III

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Waste Management Department and the Solid Waste Management and Public Cleansing Corporation under MHLG. The main purpose of this handing over was to increase the quality of the environment through effective and efficient solid waste management and public cleansing.

6. Finances locales

6.1 Revenue sources The revenue of local authorities comes from the 3 main sources below: Tax revenue which covers assessment tax, and it is the main source of revenue for local authorities with contribution between 60-70%; Non tax revenue which consist of license payment, trade and investment profit, compounds, fines and other chargeable services; Acceptance of non revenue which includes grants received from the State Government or the Federal Government.

6.2 Expenditure responsibility Almost 80% of expenditure of local authorities is for management expenses consist of: Staff salaries; Transportation and utilities; Supplies; Professional services; Assets; Others such as rental, claims and loan repayments.

needs of their client and contribute to the national development.

They are envisaged reform for the future since, in 2020, 70% of Malaysian residents will lives in the urban areas. To fulfill the demands due to rapid urbanization and the increase of urban residents, improvement measures by MHLG has taken place and will continue to take place to further improve local authorities services delivery system.

Among the measures are: National urbanisation policy; Yearly allocation or budget assistance for local authority development projects; Safe city programme; New initiatives on the real estate development sector which encompasses the implementation of One Stop Centre (OSC), issuance of Certificate of Completion and Compliance (CCC) by the professional and the establishment of Commissioner of Building (COB); Expediting the business licenses, composite hotel licenses and small traders permit approval process; e-Local Government program; Evaluating the performance of each local authorities through star rating system; Public cleanliness program; - Local Agenda 21 programme (LA 21).

7. Conclusions Even though all local authorities in Malaysia are under the purview of each State Governments, through the acts related to the role and functions of local authorities which was legislated by the Parliament, the implementation of uniform policies by the NCLG and the continues cooperation with all the State Governments, local authorities, stake holders and parties with vested interests, enables MHLG to ensure all local authorities in Malaysia able to fulfill the IV