State polls: Johor receives more from Federal govt than it contributes, says Anwar
Prime Minister Datuk Seri Anwar Ibrahim stated that Johor receives an average of RM16 billion in annual federal allocations between 2023 and 2025, exceeding the RM14 billion in revenue the state contributes to the federal coffers. According to the Prime Minister, this net gain renders proposals to return 25% of collected revenue to the state unnecessary.
Why isn’t the Federal Government returning 25% of Johor’s revenue?
The demand for a 25% revenue return stems from calls for greater state financial independence, a topic recently raised by Johor Regent Tunku Ismail Sultan Ibrahim during a June 20 podcast in Muar. However, Anwar Ibrahim rejected this suggestion during a June 22 speech at Bukit Gambir, citing a deficit in the state’s contribution relative to its spending.
The numbers are straightforward: the federal government spends RM2 billion more on Johor annually than it collects from the state. Because the allocation (RM16 billion) outweighs the revenue (RM14 billion), Anwar argued that the state is already a net beneficiary of federal funding.
How does Johor’s federal funding compare to other states?
Johor holds a dominant position in federal resource distribution. Beyond general development, Anwar Ibrahim noted that Johor is the second-highest recipient of the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) programs, surpassed only by Selangor.
The Prime Minister detailed 13 major development projects currently underway or in the planning stages within Johor. These projects carry price tags ranging from RM240 million to as high as RM10 billion, further inflating the federal expenditure in the state.
This funding pattern creates a specific fiscal dynamic. While states like Sabah and Sarawak often negotiate based on special constitutional rights, Johor’s relationship with the center is defined by high-volume infrastructure investment and social welfare disbursements.
What is the “Sarawak Model” of state-federal negotiation?
Anwar Ibrahim pointed to a RM1.8 billion settlement for the Bintulu Port with the Sarawak state government as the ideal blueprint for resolving disputes. He argued that cooperation and negotiation yield better financial results than public criticism.
The Bintulu Port precedent shows that the federal government is willing to make significant payments to states when negotiations are handled professionally. Anwar questioned why states would “fight when we can work together,” suggesting that Johor could achieve similar wins through diplomatic channels rather than political pressure.
Can the Royal Institution be used in political contests?
The Prime Minister issued a stern warning to political parties against using the Royal Institution to attack opponents. This follows recent public discourse involving the Johor monarchy and federal policies. Anwar emphasized that while political parties contest elections, the monarchy should remain separate from these frictions.
He noted his ongoing positive relationship with Johor Regent Tunku Ismail Sultan Ibrahim, describing the Malay Rulers as an “umbrella for unity.” According to Anwar, maintaining this boundary is essential for a functioning democracy and national stability.
Federal-State Fiscal Snapshot
| Metric (Annual Avg 2023-2025) | Value |
|---|---|
| Federal Expenditure for Johor | RM16 Billion |
| Revenue Collected from Johor | RM14 Billion |
| Net Federal Contribution | +RM2 Billion |
Frequently Asked Questions
Does Johor contribute more to the federal government than it receives?
No. According to Prime Minister Anwar Ibrahim, Johor receives RM16 billion in allocations while contributing RM14 billion in revenue annually.
Which states receive more federal funding than Johor?
Sabah and Sarawak are the top two recipients of operating and development expenditure, with Johor ranking third.
What is the significance of the Bintulu Port settlement?
It serves as a case study for successful state-federal negotiation, where the federal government agreed to a RM1.8 billion settlement with Sarawak.
What is the Prime Minister’s stance on the Royal Institution in politics?
Anwar Ibrahim stated that the Royal Institution should not be used as a tool for political attacks and must remain an umbrella for national unity.
How many major projects are planned for Johor?
There are 13 major development projects with costs ranging from RM240 million to RM10 billion.
What do you think about the balance of power between state and federal governments? Should states have more autonomy over their revenue? Let us know in the comments below or subscribe to our newsletter for more deep dives into Malaysian policy.