KOTA KINABALU: The Sabah government has requested to be involved earlier in the planning and selection of projects to address the underutilised federal development funds.
State Finance Minister Datuk Seri Masidi Manjun said the underutilisation of federal development funds in Sabah is largely due to delays and inefficiencies in implementation processes.
"We will continue negotiations with the Federal Government to release advance allocations for preliminary works earlier.
"Among the key issues are the late receipt of approved project lists by the State Government, lack of coordination between Federal and State agencies as well as technical departments, and unrealistic or excessively high allocations that cannot be fully spent," he said during his winding-up speech at the state legislative assembly sitting here.
To address the challenges, the State Development Action Council has agreed to establish a coordination committee between the State and Federal Governments to address implementation issues and ensure effective use of approved funds.
"This committee will help resolve project implementation problems and ensure the allocated funds are utilised as intended," he said.
Masidi said that for 2024, the Federal Government revised Sabah's development allocation from RM6.67 billion to RM5.063 billion, covering 1,241 projects.
"These include RM2.218 billion (43.81 per cent) for new projects and RM2.845 billion (56.19 per cent) for continuing projects.
"As of Oct 7, 2024, expenditure performance has reached 53.97 per cent or RM2.732 billion," he said.
Masidi said that federal allocations are disbursed based on the progress of identified projects and programmes.
"The State Government had proposed transferring unspent Federal allocations to a Special Trust Fund, but this was rejected because the allocations are loans from specific institutions for development programmes.
"These funds can only be disbursed in line with the progress of the projects," he said.