LOCAL AUTHORITIES IN EAST MALAYSIA STATES TO GET FEDERAL GRANTS FROM NEXT YEAR

PUTRAJAYA, Aug 25 (Bernama) -- The federal government has agreed to extend
annual grants to local authorities in East Malaysia states of Sabah and Sarawak
from 2010, Prime Minister Najib Razak said Tuesday.

He said this would involve an additional allocation of RM62.8 million as
presently, such grants were given only to local authorities on Peninsula
Malaysia.

"It is hoped that the grant will enhance the quality of service given to the
people by the local authorities in Sabah and Sarawak," he told reporters after
chairing the National Finance Council meeting here.

He said the federal government had also agreed to raise service payments to
the state governments for handling development projects on its behalf from five
percent of the total value to 10 percent for states in Peninsula Malaysia and 12
percent for Sabah and Sarawak.

"This is because of the involvement of state government employees in
implementing federal government projects in the states," he said.

"This decision means that the federal government's contribution to state
governments will increase from RM75 million to RM150 million," he added.

Najib also said all state governments received the Audit Certificate Without
Reprimand for 2008 from the National Audit Department.

Nevertheless, state governments should do follow-up actions on the
observations noted so that any defficiencies would not happen again and their
performance could be maintained, he said. (US$1=RM3.52)
-- BERNAMA