"Putrajaya behaves as if we are a unitary state and not a federation.
"The autonomy of the states, their rights to development and to the husbandry of their own resources, and the proper role of the rulers and the way in which religion is governed in public life are displaced in favour of increasingly centralized and absolute power.
"This is unconstitutional and must be resisted with just as much vigour as we resisted the Malayan Union.
"Malaysia is not viable in the long run as a unitary state," the Gua Musang MP said on Thursday at a Bar Council forum on Federal-State relations which questioned, Should states be given more power?
The Kelantan prince argues his case against the backdrop of the Federal government's refusal to pay his state the 5% cash payments that he said is due to it in accordance with the Petroleum Development Act 1974. An 800-year-old tradition
Tengku Razaleigh dealt at length on the country's parliamentary laws, saying Malaysia's constitution was established on an 800 year old tradition of constitutional law.
"These are solid foundations for constitutional democracy. If Malaya were not already a Federation,Sabah and Sarawak would not have come together with us to form Malaysia in 1963.
"Federation is the only political basis on which Malaysia is a viable political venture," he said.
Tengku Razaleigh said unlike in a unitary state, sovereignty in a federal state is decentralized.
"Thus, the rights of citizens are secured at two levels, federal and state.
" In Malaysia, Federation was a way to accommodate the different histories and pre-existing sovereignty of the member states of the Federation.
"Federalism is a way of dividing and sharing power. In the system envisaged in our Constitution, this division and sharing of power is part of a system of checks and balances meant to protect the rights and freedoms of our citizens.
"The separation of powers between the judiciary, the legislature and the executive are part of that complex interlocking system," he said.
Sovereign states before the federation
Tengku Razaleigh, who once challenged Dr Mahathir Mohamad for the Umno presidency, there were sovereign states in the country even before there was a federation and also before the various forms of colonial rule.
"The Federation derives it powers by the voluntary and binding agreement of the states, not the other way around. This conviction was well tested in the way the Malayan Union proposal was rejected.
"Thus, we had an auspicious start as a country, because our political arrangement guaranteed our rights within a system that reflected and protected our cultural and historical diversity. Federalism provides for the right measure of local autonomy.
"Decision-making, particularly about the allocation of resources, could be made in a way that more closely reflected the interests of people on the ground, that is to say, more efficiently."
The founding chairman of Petronas, fondly called 'Ku Li' by Malaysians, said the Federal government’s refusal to pay Kelantan, and it’s arbitrary treatment of Terengganu’s oil money – on and off according to whether the state was in Opposition hands—is in violation of a solemn contract, sealed in an Act of Parliament, between the state governments and Petronas.
"The Federal government is reneging on a contract and in contempt of Parliament.
"Its attitude to these oil payments is transparently based on one criterion: those states whose legislatures are not controlled by Barisan Nasional are denied payment.
"This practice punishes citizens for their choice of state government. This is an attack on the right of the people to choose their own government within our system of parliamentary democracy.
"Oil payments are just one form of selective denial of funds to the states," he added.
Stepping back to 1948, he said the various states in the Malay peninsula came voluntarily into a federation and created a common federal government.
As part of that agreement, he said, the Federal government had jurisdiction over waters beyond three nautical miles, while the states had jurisdiction within three nautical miles.
"Oil had not been discovered in Malaya at the time. Had it been found, however, anything within three nautical miles would have belonged in its entirety to the state, and anything beyond that to the federal government," said Tengku Razaleigh.
"In 1974, we formed Petronas as a common trust between the federal and state governments for all petroleum found anywhere in Malaysia,onshore or offshore.
Profits between Federal and state govts
"We did this by persuading the states governments, one by one, to vest their entire rights and claims to petroleum, onshore or offshore, in perpetuity to Petronas.
"The federal government did the same. By design, this obliterated any considerations of
whether the oil was found within or beyond three or 12 nautical miles.
"So long as Malaysia had any share in the oil, the profits would be divided between the federal government and the relevant state government according to a simple formula: 5% to each.
"As the founding chairman of Petronas I signed these deeds with each chief minister and with the federal government," he said.
The federal government has refused to acknowledge Kelantan’s claims, arguing that oil and gas are extracted from waters that are beyond the three nautical mile limit prescribed as territorial waters under Malaysia’s Emergency Ordinance (Essential Powers) No 7 1969.
In Terengganu, oil was discovered in 1973 off its shores in the South China Sea, a year before then prime minister Abdul Razak Hussein directed Tengku Razaleigh to form Petronas and become its founding chairman.
Petronas started paying Terengganu the 5% oil royalty when offshore production began in 1978 but stopped after PAS captured the state in the 1999 general elections.
Pakatan Rakyat has said it will hold a referendum on its proposal to provide Kelantan, Terengganu, Sabah and Sarawak 15% of oil royalties should the coalition come to power. The move has been backed by Tengku Razaleigh. — Malaysian Mirror
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