Public Sector Accounting: Three Tiers Government System of Malaysia

This article discusses the three tiers government system of Malaysia, the functions of local authorities, real cases associated with decentralization through devolution, and recommendations to sustain local governments’ authorities.

Running head: PUBLIC SECTOR ACCOUNTING
PUBLIC SECTOR ACCOUNTING
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Part 1: Description on the three tiers government system of Malaysia
The federal government functions based on the separation of power that are stated on the
Article 127 of the Constitution of Malaysia. Therefore, the three branches of the Malaysian
government include the legislature, judiciary and executive. While the three tiers of the
government system consist of the federal government, state government and the local
government.
The federal government- the federal government of Malaysia is considered as the highest
authority and the headquarter is located in the Putrajaya. Prime Minister is the head of the federal
government of Malaysia. The levels of the government consist of the three different branches
(judiciary, legislature and executive). The prime minister leads the cabinet and exercises the
executive power as mentioned in the constitution. The Malaysian premier is said to be the
member of the lower house. The prime minister is the head of the head of the government along
with the other cabinet ministers. It is important to mention that the parliament of Malaysia is
made up of the senate, house of the representatives and the lower house. The number of the
senate members is 70 and they have a two-term limit and each of the term lasts for about three
years. The parliament has a five-year mandate, although it can be dissolved by the King on
advice by the Prime minister. The highest court of the country’s judicial system is the federal
court of Malaysia and it is followed by the court of appeal and remaining two high courts (Rosli
et al., 2015).
State government-Malaysia has a total of 13 states and each of the state forms
government under the state constitution. The states have a unicameral state legislative chamber.
Chief minister heads are a member of the state assembly and they are a part of the majority party.
The chief ministers are appointed by the governors and sultan on recommendation by the prime
minister.
Local government- the local authorities are the lowest level of the government and is
mainly concerned with the collection of the taxes, permits to the traders, issuing licenses. It also
provides basic services, waste management and development. The local government are headed
by the civil servants (Rosli et al., 2015).
Part 2: Identify the functions of local authorities

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The local government is also called as the local government, Penguasa Tempatan, Majlis
Tempatan, Pihak Berkuasa Tempatan (PBT). The major responsibilities of the local authorities
can be differentiated into the housing, facilities and amenities, planning, water supply and
sewage, environmental protection, welfare and health, building roads, control and development
of incentives. Housing: this responsibility includes the maintenance of the housing under the area
of the local government; assessment of the housing needs (lease and buy dwellings, build and
area). Facilities and amenities: provide services, facilities, amenities; the facilities and amenities
are related to providing libraries, sports and games, artistic and cultural amenities. Planning:
decide whether to refuse or grant the planning permission; creation of the development plan for
every 5 years (planning policies). Sewage and water supply: provide essential and vital services
like drainage, sewerage services and water services, fire services, bridges and roads; control
dangerous buildings, places, structures. Maintain and provide burial grounds or graveyards.
Environmental protection: monitoring of the environment for the signs of pollution; collection of
the domestic and other types of waste; issuing licenses (keeping dog within its marked area,
disposal of waste and controlling emission from the plants); other major functions include animal
and pollution control. Welfare and health: local government play an important role in relation to
the health within the area. The other major functions include the following: regulating and
constructing the road systems, overseeing and planning the development (it includes the
structural plans and preparations); controlling and licensing billboards, advertising, night spots,
entertainment, hawkers, and trade; beautification of the cities, providing food quality control,
health services, control of the contagious diseases, maintenance of cleanliness of the food
centers, regulating and constructing the road services, management of the public transportation
and traffic systems, maintenance of a clean environment and regulation of the drainage systems,
maintaining and providing the public amenities (Abidin, Singaravello & Zakaria, 2015).
The four major functions of the local government can be considered as the major
responsibilities that can be further categorized into the following:
 Security- concentrating on the fire station and police station and responsible
action taken on the public nuisance.
 Public service- focus on the turn normal ground into playing fields, badminton
courts, gymnasium, town hall, car park and bus stand. Alternatively, it also

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provides with the sports centers and the community halls in exchange for the
council service and planning permission. The buildings also become assets for the
council, furthermore the charges and the fees can also be collected for the usage
of the facilities into the buildings.
 Social- The local authorities usually have the traditional functions and it means
the it will provide cleanliness activities like the sanitation, sewerage, industrial,
and well as the housing garbage collection and others. However, other than that
the local authorities also provide the health consciousness and educational
facilities so that the obnoxious trade can be controlled. Protection of the handicap
by building the shelter, along with-it providing welfare houses for the older
people. The housing areas are also built so that it can create cultural activities.
 Environment- focusing on the flood control, proper culvert and draining systems,
recreation park, lamppost, traffic control and road service (Abidin, Singaravello &
Zakaria, 2015).
Role of the local government in achieving the UN sustainable Development Goals- in the
year 2016, the Prime Minister’s department of economic planning organized a workshop so that
it can engage the local government, state, federal, along with the academia, think tanks, private
sector, civil society organizations on how to achieve the sustainable developmental goals. Within
the Malaysian context, monitoring and implementing at the local level is decided and this will
help to achieve the sustainable development goals at the global, national and local level. The
workshop also highlighted that a federal state like Malaysia must establish a relationship
between the local and the central units. The workshop also highlighted on how the national
vision can be integrated with the local government so that the sustainable development goals can
be achieved in a better way and it will also help towards achieving the local level results. The
process that needs to be emphasized include monitoring, evaluation, and reporting of the various
processes (Abidin, Singaravello & Zakaria, 2015).
Part 3: Review of real cases associated with decentralization through devolution
1st case: the first case deals with the policies and the local efforts and the efforts put up
by the local government in the change in climate and adaptation. A report was put up by the
Royal commission of the inquiry and it can be seen as the following:

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 The local government represents as the third tier of the federal structure.
 The local areas are governed by the councilors that are nominated by the state and
also by mayors in certain cases.
 The local government geographically encompasses a portion of the country
 The subject that are to be controlled and the subordinates will be limited in terms
of the administrative and the financial issues.
 The local government provides the discretionary and the obligatory services and
goods.
A total of the 165 local authorities are present in Malaysia and modified or special local
governments. These designated areas are marked as the political boundaries and the political
parties select the mayors after winning election. It is also important to mention that the local
authorities adhere to the local government Act of 1976 or the Act 171 (Bello & Dola, 2014).
2nd case: The sustainable development plan of the Malaysian government incudes the
local governance and it also includes the urbanization policy of the country. The urbanization
policy is also called the National Physical Plan (NPP) and this policy itself consists of the state
efforts and the local efforts towards building sustainable societies. The National Urbanization
Policy (NUP) requires a strict adherence to the developmental plans through the monitoring and
the coordination of the developmental plan implementation at the different levels of the
government. It also requires the development of the comprehensive land use database that are
present at the local and the state levels. Although the local administration is weak, the adherence
to the good governance policies that are outlines in the Agenda 21 led to the effective
involvement of communities for the purpose of the sustainable plan at the local level
(Hutchinson, 2014).
3rd case: Malaysia stands out from the other countries in terms of the governance. Unlike
the other countries and it led to the construction of the new layers of the government and it led to
the creation of the federal structure. The country later on proceeded after the independence to
implement the centralization. Theoretically, the federal system processes the potential to provide
protection to each and every level of the government. It is important to note that the dominance
of the ruling coalition at the nation level have seriously led to a centralization drive. The new
economic policy at the same time infused a wide scale if government intervention within the

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economy through the process of creeping authoritarianism. This has negatively increased the
coercive powers of the state by suppressing the opposition. The drive for centralization has
deteriorated the proper functioning of the Malaysian government and it later on the government
laid its emphasis on the decentralized form of government.
4th case: The local government in Malaysia ranks third and is the lowest in terms of the
state and the federal governments. The local and the state governments operate within the
framework and is also economically, financially and politically subordinate to the federal
government. The Royal commission of enquiry has also highlighted that the redistribution of the
responsibilities between the different tiers of the government. The local government remains
tightly controlled by the powers of the strong center and they have the role of revenue collection
and community participation. The local government is also seen to be experiencing challenges
towards the changing nature of the local environment and the communities are aware of the
condition and they are well aware of the fact that the local government is unable to deliver what
the people of the community wants. Even though the services are sometimes delivered, but still
they lack the quality and there remains a gap in the service delivery. It is important to note that
there is a gap between the demand and the supply of the service delivery and also the judgements
regarding the performance of the local government (Joseph, Pilcher & Taplin, 2014).
Part 4: Recommendations and discussion on ways to sustain local governments’ authorities
1. the main challenge is that the increase the quality of life is associated with the implementation
of the proper quality of life and it will effective and strategic planning. The main aim or the
target is the enhance the prosperity of the lives of the people. Different types of the strategies can
be recommended and it includes the increased role of the council for the purpose of the
development based on the increasing the revenue, the importance of emphasizing on the
operational structure. This also includes creation of an environment that will positively
contribute to the economic capability of the state. Therefore, it is important to mention that the
economic and environmental stability can be reached by focusing on the community
participation and focus must be placed on the consortia and the collaboration within the
community. Furthermore, a collaboration can be reached by setting a smart collaboration
between the Non-governmental organizations, academic institutions, private sectors and the
councils. The main strategy will be promoting productive tourism and also promote investment

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so that it is recognizable and the government is able to achieve the community participation that
is seeking for. The strategy will be helpful and on the other hand it will help to improve the
environmental quality. The new approach will be based on the concepts of smart partnerships
through the application of the local agenda 21 methodology. The set up will integrate the
commitments and the roles of all the parties that are associated with the development of the
safety and conservation, environmental conservation, increasing the quality of living and the
community development projects (Midin, Joseph & Mohamed, 2017).
2. Empowering: the main goal is to place the final decision into the hands of the public. The
main promise is to implement whatever is being decided by the public for the betterment of the
public. One of the biggest example is the putting the ballot and it is one of the commonly cited
example that provides and facilitates the decision making power of the public. This will allow
the public to assess and determine the best decision that will be best for the people. Empowering
the public engagement is a resource intensive, time consuming, and difficult to execute. There
also exists a possibility where the public relations might break and it might also break the trust of
the public if the decision making does not serve the purpose of the general public and also if a
consensus is not reached. Due to this and also for the laws the direct public processes in certain
cases cannot be used. A phenomenon called the participatory budgeting that gains popularity at
the local levels and it can be a form of empowering engagement. This entirely rely on the
popular local levels of brainstorming and it develop the proposals of projects.
3. Predictability- consistency in terms of applicability of the regulations, rules and laws helps in
the creation of an orderly society. It is important to mention that there will be plenty of issues if
the rules are not followed properly and no discipline is maintained in terms of implementation.
Therefore, it is important to emphasize on the important aspect of the four elements including
predictability, participation, accountability and transparency, and good governance. There is a
need for the value driven leadership and the value based leadership, and along with it there is a
need of the a meaningful and a genuine local autonomy provided by the law. True local
autonomy can be achieved if the local governance is effective and responsive at the local level
(Midin, Joseph & Mohamed, 2017).
4. Participation and transparency- the principle of participation is anchored at the basic levels
and it is the very core and the heart of the development of a nation. Participation is the inclusion

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of the general public into the different arenas of the governance that include the proper inclusion
and consideration of the choices and decisions of the general public. Participation helps the
government agencies to take the necessary step towards the implementation of proper policies
through an effective way. Transparency can be described as the availability of the accurate
information and it includes the articulation of the government decisions, regulations and rules. It
implies that the copies of the guidelines and the rules will be used for the conduct of the
business. This will make the information easily available to the stakeholders and also to the other
people. Transparency and accountability goes hand in hand and the information that are relevant
for the local officials include the matters like the delivery of the basic services, procurement of
the equipment, implementation of the infrastructure projects in places where the public bindings
will be required. These factors can be considered as an important aspect for a responsive public
service (Midin, Joseph & Mohamed, 2017).

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Government: Effect on Accountability and Public Trust. Procedia-Social and Behavioral
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Bello, A., & Dola, K. (2014). Sustainable development and the role of local governance:
experience from Malaysian model regions. International Journal of Humanities and
Social Science, 4(1), 268-280.
Hutchinson, F. E. (2014). Malaysia’s federal system: overt and covert centralisation. Journal of
Contemporary Asia, 44(3), 422-442.
Joseph, C., Pilcher, R., & Taplin, R. (2014). Malaysian local government internet sustainability
reporting. Pacific Accounting Review, 26(1/2), 75-93.
Midin, M., Joseph, C., & Mohamed, N. (2017). Promoting societal governance: Stakeholders'
engagement disclosure on Malaysian local authorities' websites. Journal of cleaner
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Rosli, M. H., bin Abd Aziz, M. A., Mohd, F., & Said, J. (2015). Integrity systems in Malaysian
public sector: an empirical finding. Procedia Economics and Finance, 28, 260-265.