PETALING JAYA: The public should not assume that every infrastructure problem is the responsibility of one party alone, as jurisdiction, implementation and funding may involve both the federal and state governments.
Universiti Malaysia Sabah lecturer Ramli Dollah explained that the division of responsibilities between the federal and state governments is broadly set out in the Federal Constitution.
He said the federal list, state list and concurrent list contained in the ninth schedule to the constitution outlines the powers and jurisdiction of each level of government.
“The people must be careful not to immediately assume that all infrastructure problems are the responsibility of (the federal) government.
“We must distinguish between three things: who has jurisdiction, who implements the project, and who provides the money. Sometimes these three things involve different governments,” he told FMT.
In general, areas such as defence, internal security, education, and medicine and health fall under the federal government.
The states, meanwhile, are responsible for land, agriculture, forestry and local government, while both levels manage social welfare, town and country planning, and certain aspects of public health.
As a result, Ramli said problems cannot automatically be attributed to the federal or state governments simply because of where they occur.
For example, land and forestry are state matters, meaning issues related to forest management and timber resources should be viewed based on the responsibilities of the state government concerned.
Despite this, the federal government also channels various forms of grants to states to help finance their responsibilities and support development.
In March, the National Finance Council agreed to improve federal grants to states—with allocations projected to reach RM10.5 billion this year, compared with RM10.3 billion in 2025.
These include allocations for matters contained in the concurrent list, state road maintenance, and the distribution of tourism tax revenue.
Roads and water supply
Roads are one of the clearest examples of how responsibilities are divided between federal and state.
Federal roads are under the responsibility of the federal government, while state roads are managed by state governments. Some roads also fall within the jurisdiction of local authorities.
However, that does not mean all costs incurred at state level are borne solely using state resources. Putrajaya also channels funds via a state road maintenance grant, known as Marris, to help finance maintenance work on state roads.
Under Budget 2026, the federal government allocated RM2.5 billion for federal road maintenance, but also provided RM5.6 billion through Marris for the maintenance of state roads nationwide.
Universiti Kuala Lumpur economist Aimi Zulhazmi Abdul Rashid said responsibility for water supply was not confined to a single authority.
Water resources and rivers remain under state jurisdiction, while water services and supply in the peninsula and Labuan fall under the concurrent list following a constitutional amendment in 2005.
Aimi said this could create what is known as a “split incentive”, where the party that provides capital for infrastructure development does not necessarily receive the direct benefit or return from the investment.
He said the public should also look at the scale of a problem to understand which party was more closely linked to it. Issues affecting a wider supply chain may require federal involvement, he said, while localised issues are more closely tied to state administration.
Hospitals, schools
Health and education are among the core areas under federal jurisdiction, even though hospitals, clinics and schools are physically located and operate within the states.
Under Budget 2026, the federal government allocated RM46.5 billion to the health ministry, including RM1.2 billion for the maintenance and repair of government hospitals and clinics, and RM100 million to upgrade wards at district hospitals.
For education and training, federal expenditure in 2026 is estimated at RM74.37 billion.
Sabah and Sarawak
The division of powers is slightly different for Sabah and Sarawak, as both states enjoy additional powers under the constitution.
In addition to the standard state and concurrent lists, the two East Malaysian states also have a supplementary state and concurrent list, which grant them greater autonomy in certain areas.
Ramli said this stems from the agreement reached for the formation of Malaysia in 1963.
However, he said it did not mean that the federal government was no longer involved in financing development and services in the two states.
Under Budget 2026, Sabah and Sarawak received the highest federal development allocations, at RM6.9 billion and RM6 billion respectively.
In November 2024, then minister in the Prime Minister’s Department for federal territories, Dr Zaliha Mustafa, said Sabah led the country with 1,244 federal development projects while Sarawak had 1,124.
However, their spending rates as of October that year stood at only 46.7% and 54.43%, respectively, due to slow project implementation.
Factors such as land acquisition, logistical hurdles, difficult terrain and poor coordination between agencies often explain why spending lags behind allocations, rather than reflecting inadequate federal funding.