GEORGE TOWN: Representatives from state governments across Malaysia’s political divide today called for substantial institutional reforms to federal-state relations, arguing that stronger constitutional safeguards are needed to ensure states are treated fairly regardless of the party in power in Putrajaya.
The consensus emerged during the inaugural Interstate Forum on Federal-State Relations organised by Penang Institute and the Penang State Legislative Assembly’s Select Committee on Federal-State Relations.
The forum brought together representatives from states governed by different political coalitions, including Penang under Pakatan Harapan, Sarawak under Gabungan Parti Sarawak, Perlis under Perikatan Nasional, and Kelantan and Terengganu under Pas.
The leaders argued that existing federal-state arrangements remain vulnerable to political considerations and should be strengthened through institutional and legal reforms that would outlast changes in government.
The gathering is believed to be the first of its kind in Malaysia, bringing together representatives from states governed by rival political coalitions to discuss federal-state relations – a subject often viewed as politically sensitive.
Institutions over politicians
Penang Chief Minister Chow Kon Yeow said discussions should focus on institutions rather than politicians, noting that political leaders and parties come and go, but institutions endure.
“The purpose of this forum is not only to discuss state interests but also the broader process of nation-building and how we can strengthen institutions and improve federal-state relations so that we can jointly develop the country,” he said during a press conference.
Chow acknowledged that some states have experienced differing levels of access to federal projects depending on political circumstances.
He said development approvals should be based on objective needs rather than political considerations, adding that stronger institutional arrangements would help ensure fairness and continuity.
Chow also highlighted the need to review existing fiscal arrangements between Putrajaya and the states, saying constitutional grants remain limited in scope and are often insufficient to meet development needs.
He suggested greater revenue-sharing mechanisms could help states become more financially capable and independent in implementing projects tailored to local needs.
Towards a rules-based system
Penang State Legislative Assembly Select Committee on Federal-State Relations chairman Gooi Hsiao-Leung said the forum was intended to explore ways of strengthening existing federal mechanisms, particularly in light of experiences following elections, where differing political alignments between Putrajaya and state governments sometimes created administrative challenges.
Gooi said discussions should include a long-term review of constitutional provisions governing federal-state relations, including whether additional powers and corresponding financial resources could be devolved to state governments.
“What’s important is that we have a rules-based system, a constitutional review and mechanisms to ensure the needs of all states are properly protected,” he said.
“If institutions are solid, then changes of government will not matter because everyone’s interests will continue to be safeguarded.”
Echoing the call for institutional safeguards, Sarawak Deputy Minister in the Premier’s Department (Law, MA63 and State-Federal Relations) Datuk Sharifah Hasidah Sayeed Aman Ghazali said reforms should be embedded in law rather than depend on political goodwill.
She said Sarawak’s experience in pursuing its rights under the Malaysia Agreement 1963 demonstrated the importance of structural and constitutional reforms that transcend changing political dynamics.
“We need institutional change, structural change and constitutional change,” she said.
“If the state is strong, Malaysia will be strong. If the state is rich, Malaysia will be rich.”
Sharifah Hasidah said a review of constitutional and legal frameworks governing federal-state relations would help institutionalise protections for all states regardless of their size or political affiliation.
Beyond politics
Perlis Youth and Sports, Communications and Digital, Transport, Science, Technology and Innovation Committee chairman Wan Zikri Afthar Ishak argued that smaller states often faced structural disadvantages under the current system.
Citing the example of ferry services connecting Kuala Perlis and Langkawi, as well as cross-border economic activity with Thailand, he said Perlis received little direct benefit despite hosting critical infrastructure and bearing the associated costs.
Wan Zikri said political realities could not be ignored, arguing that governments often prioritised areas under their own political control.
“What we need is a system that continues regardless of who becomes the leader or which party forms the government,” he said.
“Enough talking, let’s find a solution. The problem is the system.”
A timely conversation
In his welcoming address, Penang Institute executive director Datuk Dr Ooi Kee Beng described the forum as a timely platform to examine how Malaysia’s federal arrangements can evolve to address increasingly complex national challenges.
He said issues such as economic transformation, infrastructure development, climate resilience, digitalisation, public service delivery and social inclusion required close cooperation between Putrajaya and the states, making effective federal-state coordination more important than ever.
Ooi stressed that the gathering was not intended to revisit old disputes but to create a constructive space for dialogue on how institutions could function more effectively and serve the interests of the rakyat.
He added that meaningful policy reform begins with open discussion, the exchange of ideas and the building of consensus, expressing hope that the forum would contribute to stronger networks of cooperation among policymakers and stakeholders across the country.
The forum featured two panel discussions titled “Federalism at the Crossroads” and “The Globality of Federalism”, involving legal experts, academics, economists and policymakers from Malaysia and abroad.
Main image: Chow addressing participants at the inaugural Interstate Forum on Federal-State Relations.
