KUALA LUMPUR, July 29 — The Kedah state government has finalised the historical research and legal groundwork required to pursue a revision of Penang’s lease payment rates, Menteri Besar Datuk Seri Muhammad Sanusi Md Nor claimed when saying the state is now waiting for the optimal moment to strike.
Following a comprehensive review by the state’s research and legal teams, the findings have been presented to and approved by the State Executive Council, Sinar Harian reported.
“I am satisfied with what has been prepared by our research and legal teams. This was also presented to the excos, and they are satisfied as well. All the documents are ready — we are just considering the most suitable time to submit them,” Muhammad Sanusi said on a podcast.
The move follows a royal decree by the Sultan of Kedah, Sultan Sallehuddin Sultan Badlishah, on July 5. The Sultan called on the federal government to review the lease payments in line with current values, asserting that the current rates are far below their proper value and that Kedah’s sovereignty, as enshrined in the Federal Constitution, must be respected.
The dispute has already triggered a rebuttal from Penang. Chief Minister Chow Kon Yeow maintained on July 9 that the matter is strictly a federal issue, noting that the state administration has had no discussions with Kedah as the payments do not originate from Penang’s own coffers.
Chow further said that Penang has received no formal legal correspondence from Kedah, despite Muhammad Sanusi’s assertions that a legal team had been assembled.
The conflict is over a valuation gap: the federal government has paid Kedah an annual honorarium of RM10 million on Penang’s behalf since 2018, but Kedah is now seeking an increase to RM100 million per year.
Muhammad Sanusi declined to disclose the full strategy, citing legal sensitivity, but indicated that the state is weighing whether to act now or wait for a more “neutral atmosphere” to ensure the arguments are assessed fairly.
Potential avenues include filing a lawsuit in court, bringing the matter before the Conference of Rulers, or entering direct negotiations with the federal government.
Rejecting claims that the state is simply seeking “free money” from Putrajaya, Muhammad Sanusi framed the pursuit as a matter of right.
“This is not about free money. We are only claiming Kedah’s rights. If those rights are recognised, then pay according to the rate that is due, as commanded by the Sultan of Kedah,” he said, noting that the lease rate has not been reviewed since 1786.
The state also intends to use the process to educate the public on the historical relationship between Kedah and Penang, citing documents over 200 years old that have rarely been made public.
According to Muhammad Sanusi, the claim is rooted in an unresolved issue from the pre-independence era, where the urgency of securing independence took precedence over renegotiating the lease.
He argued that the payment obligation falls on the federal government under Article 167 of the Federal Constitution, which governs the Federation’s obligations regarding pre-independence treaties.
While the payment was raised to RM10 million during the administration of Tun Dr Mahathir Mohamad, Muhammad Sanusi questioned why the matter has remained dormant for decades.
“Next year marks 70 years, but it has never been discussed again. Why has it been left alone? Because no one wants to talk about it,” he said.
