JUNE 22 — Article 109(1)(a) of the Federal Constitution provides for a grant known as capitation grant to be payable to each state in respect of a financial year. The capitation grant must be calculated in accordance with the provisions of Part I of the Tenth Schedule.

Section 1(1) of Part I of the Tenth Schedule sets out the rates of the capitation grant. In 1963, the rates were as follows:

  • (a) for  the  first  50,000  persons  at  the  rate  of  $15  per  person;
  • (b) for  the  next  200,000  persons  at  the  rate  of  $10  per  person;
  • (c) for  the  remainder  at  the  rate  of  $4  per  person,

The rates were stated in dollars ($) then.

Pursuant to Article 109(2) which allows Parliament from time to time by law to vary the rates of the capitation grant, the rates were amended vide the Capitation Grant Act 1977 (Act A392) which was deemed to have come into force on January 1, 1976.

The rates from that date were as follows:

  • (a) for the first 100,000 persons at the rate of $20 per person;
  • (b) for the next 150,000 persons at the rate of $10 per person;
  • (c) for the next 250,000 persons at the rate of $6 per person;
  • (d) for the remainder at the rate of $3 per person.

In 1993, vide a second Capitation Grant Act (Act 503), the rates were amended to be as follows:

  • (a) for the first 50,000 persons at the rate of $60.00 per person;
  • (b) for the next 500,000 persons at the rate of $8.50 per person;
  • (c) for the next 500,000 persons at the rate of $9.00 per person;
  • (d) for the remainder at the rate of $9.50 per person.

The rates were deemed to have come into force on January 1, 1992, and remained stated in dollars. However, the reference to dollars must be construed as ringgit by reason of Section 2(2) of the Malaysian Currency (Ringgit) Act 1975 (Act 160).

Vide a third Capitation Act in 2002 (Act 622), the rates were further amended to be as follows:

  • (a) for the first 100,000 persons at the rate of RM72.00 per person;
  • (b) for the next 500,000 persons at the rate of RM10.20 per person;
  • (c) for the next 500,000 persons at the rate RM10.80 per person;
  • (d) for the remainder at the rate of RM11.40 per person.

The rates came into force on January 1, 2002, and have remained as such since then.

The author writes that a Capitation Grant Act has been passed by Parliament every fifteen years, on average, since 1963. — Picture by Miera Zulyana
The author writes that a Capitation Grant Act has been passed by Parliament every fifteen years, on average, since 1963. — Picture by Miera Zulyana

So, while we agree with Pasir Gudang MP Hassan Abdul Karim that the Madani Government is guided by written laws and the Federal Constitution in matters involving financial allocations to states, including Johor, perhaps it is time to amend the rates of the capitation grant.

Although a Capitation Grant amends Part I of the Tenth Schedule of the Federal Constitution, it does not require a two-third majority under Article 159(3). This is because Article 159(4) exempts the requirement of Article 159(3) for “any amendment to the Constitution incidental to or consequential on the exercise of any power to make law conferred on Parliament by any provision of the Constitution other than Articles 74 and 76”.

A Capitation Grant Act has been passed by Parliament every fifteen years, on average, since 1963. It has been 24 years since the last Act in 2002.

What say the Madani Government?

And what say Hassan Karim raising this issue during the Second Meeting of the Fifth Session of the 15th Parliament which begins on Monday?

*This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.