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Federal Government: Power Hog?

The greedy hog at the table is the one who ends up hogging everything in sight.

Aside from very small grants based on population and roads, payments to the state governments are at the discretion of the federal government. On the other hand, the federal government is entitled to all the corporate and income taxes generated by the state governments.

Spot the problems yet? The clearest issue with these policies is in how performance is not related to rewards for the states. For example, Selangor generates RM16 billion in tax revenue for the federal government, yet is only allocated RM400 million in grants – less than 3% of what it generates. This also restricts the state governments’ actions – by controlling the allocation of grants, the federal government controls the measures the state governments might want to implement to improve the welfare of their various states.

There are power hogs even within the federal government itself, with power increasingly centralized within the Prime Minister’s department and the Ministry of Finance (MoF). The Land Public Transport (SPAD), for example, should be the responsibility of the Ministry of Transport, but is within the purview of the prime minister. And surely the Ministry of Works should handle the licensing of contractors, not the MoF!

The BN federal government is practicing unabashed avarice in concentrating financial and political power at the federal level, stripping the thirteen state governments of their state rights and prerogatives in the process. Feeling put out about all this gluttony? Learn more about these problems as well as other resulting complications of the power centralization in Putrajaya through UMNOnomics’ neat factoids and accompanying cartoons.

Written simply by Teh Chi-Chang, illustrated creatively by Johnny Ong and endorsed by personalities from Nurul Izzah Anwar to Kee Thuan Chye and Zunar, this book is a steal at just RM35. Pick up a copy today at a Times, Kinokuniya, or Borders bookstore near you, or order it online by visiting http://shop.refsa.org/

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