Negotiations underway for new formula of Sarawak’s special grant under Article 112D

File photo of Ministry of Finance Complex in Putrajaya. Photo credit: Kementerian Kewangan FB

By DayakDaily Team

KUCHING, Feb 12: The federal government will negotiate with the Sarawak government this year to establish a new method for calculating the State’s special grant under Article 112D of the Federal Constitution, taking into account Sarawak’s service cost needs and the federal government’s financial position.

According to Bernama news, the Ministry of Finance (MOF) said the federal government will hold negotiations with the Sarawak government this year to review the amount of the special grant under Article 112D.

The talks aim to ensure that future special grants reflect both the State’s requirements and fiscal realities at the federal level, in line with Article 112D.

The federal government had previously increased Sarawak’s Special Grant from RM300 million in 2024 to RM600 million starting in 2025, to be maintained for a period of five years while discussions on a long-term formula continue.

Regarding Sabah, MOF noted that discussions on the special grant were held on Nov 17, 2025, and Jan 28, 2026, under Articles 112C and 112D.

“The discussions considered Sabah’s needs regarding state service costs as well as the federal government’s financial position,” the ministry said in a written reply in the Dewan Rakyat, published on Parliament’s website yesterday (Feb 11).

MOF’s statement was in response to a question from Batang Sadong MP Rodiyah Sapiee on the status of finalising the new special grant formula for Sabah and Sarawak under Article 112D.

The ministry added that both the Sabah and Sarawak governments are committed to concluding negotiations within the stipulated timeline.

The talks will also address the implementation schedule and the federal government’s adherence to the principle of fiscal equity as provided under the Malaysia Agreement 1963 (MA63). — DayakDaily