Kuala Lumpur, 23 July 2024: The Institute for Democracy and Economic Affairs (IDEAS) has unveiled the findings of the Malaysia Open Budget Index (MyOBI) 2024, offering a comprehensive analysis of state budget transparency across Malaysia. This year, Terengganu and Selangor tie for first place, both scoring 76/100 for Public Availability. The MyOBI critically evaluates the accessibility and timeliness of key budget documents, the oversight role of state legislative assemblies, and opportunities for public participation in the budget process. 

The results reveal significant disparities in transparency and oversight among Malaysian states. Many state governments still fail to ensure adequate disclosure of budget information, with several not publishing essential documents. Kedah and Pahang, in particular, lag behind with insufficient disclosure, highlighting the urgent need for improvement. On a positive note, Sarawak and Melaka have made notable progress by enhancing access to crucial budget information compared to previous assessments. However, there remains a critical need for all states to ensure transparent access to budget information.

Despite overall positive developments, concerns persist regarding the oversight capabilities of State Legislative Assemblies (Dewan Undangan Negeri, “DUN”). While states like Selangor, Terengganu, and Sabah have shown stronger oversight through timely budget submissions and increased legislative sessions, overall performance in this area remains inadequate. Effective oversight demands the publication of hansards, sufficient time for budget deliberations and questions, and Public Accounts Committee (PAC) records to apprise the public of the outcome of legislative scrutiny. 

Alissa Marianne Rode, Senior Manager of Research at IDEAS, emphasised the importance of enhancing budget transparency and public participation. “Improving budget transparency is crucial for state governments to enhance public confidence in their service delivery. From our assessment, only 7 out of 13 states provide the estimates of revenue and expenditure, while only Selangor and Terengganu provide detailed expenditure estimates. Terengganu stands out as the only state that makes the Supply Bill and enactment available, providing a vital public record of the budget authorisation.” 

Key recommendations from the report include ensuring timely public availability of Essential Budget Process (EBP) documents, such as the Estimates of Revenue and Expenditure (“Buku Belanjawan/Bajet”), to enhance transparency in state government spending. “IDEAS calls for prioritising the online publication and regular updating of hansards and PAC records to maintain transparency. 

Additionally, enhancing public participation mechanisms through forums, select committees empowered to summon state officials, and facilitating two-way dialogue with civil society during budget formulation and implementation are essential for fostering inclusive governance,” added Alissa.

Public participation in the budget process also requires improvement. “Few states currently offer meaningful mechanisms for public engagement, with notable exceptions like Negeri Sembilan and Pahang, which provide feedback mechanisms during both budget formulation and implementation stages,” said Alissa. “Melaka, Selangor, and Terengganu have initiated efforts by seeking public input during the formulation stage. However, comprehensive mechanisms for public feedback, including public forums and select committees with the authority to summon state civil servants, are essential to foster an inclusive and transparent budget process”. 

“Ultimately, the purpose of transparency is to enable accountability and democratic participation in the budget process. The states’ legislative and executive arms need to strengthen public participation by engaging with constituents and civil society to solicit budget proposals and feedback on implementation. MyOBI aims to entrench a national benchmark for proactive financial disclosure from 13 state governments. By ranking the states in terms of budget transparency, we hope to see the states competing to improve budget transparency and oversight, fostering governance that is more accountable and democratic,” adds Dr Tricia Yeoh, CEO of IDEAS. 

— END —

Download Media Statement PDF File Here

For enquiries, please contact:
Ryan Panicker
Assistant Manager, Advocacy and Events
T: 03 – 2070 8881/8882 | E: ryannesh@ideas.org.my