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6.0 ESTABLISHMENT OF LOCAL AUTHORITY
In order to understand further the status of the local authority and where does it stand, there
is also a need to understand the establishment of the local authority as a whole such as the
background and the history, its roles and functions and other related issues.

In the Local Government Act 1976, a local authority is defined as “any city council,
municipal council or district council”, as the case may be and in relation to the Federal
Territory of Kuala Lumpur means the “Commissioner of the City of Kuala Lumpur under
section 3 of the Federal Capital Act 1960 [Act 190]”.

In the Town and Country Planning Act 1976, it is defined as “any city council, municipal
council, municipality, district, town council, town board, local council, rural board, or other
similar authority established by or under any written law”.

According to Street, Drainage and Building Act *1976, “local authority” means “any city
council, municipal council, town council, town council, town board , local council rural board
or similar local authority established by written law and in relation to the Federal Territory of
Kuala Lumpur means the Commissioner of the City of Kuala Lumpur appointed under
section 3 of the Federal Capital Act 1960 [Act 190]”.

The definitions in these three Acts are almost similar to each other.

There are at present 3 main types of local authorities prevalent

™ District Councils eg. Jasin District Council
™ Municipal Councils eg. Ampang Municipal Council
™ City Councils eg. Miri City Council

There are 147 units of local authorities in Malaysia. There are 12 city councils, 38 municipal
councils and 97 district councils. The Federal Territories of Labuan and Putrajaya are run by
corporations under the Prime Minister’s Department. The most recent local authority set up
is the Hang Tuah Municipal Council in Malacca.

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 The following table shows the city councils and their date of establishment.

* Penang is insisting on becoming a city as UNESCO has already declared it as a historic

city. If Penang becomes a city, it will be able to manage public roads on its own.

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6.1 CRITERIA FOR A CITY COUNCIL
The following are the criteria needed to become a city council
™ A council must have a minimum of 500,000 people and at least RM100 million
revenue per annum and is the centre of activity for the state.
(If a council* has 450000 people, it can still be considered to be a city if it is an
important township).
™ It should be the administrative centre in the state.
™ Have steady income from financial resource (fiscally sustainable) with annual income
not less than RM100 million and afford steady expenditure.
™ Able to prepare services at a high level including revenue collection activity, approval
development for developers, enforcement and other Local Authorities functions and
have an organizational structure established with staff capable of carrying out
services efficiently and effectively.
™ Complete educational institution centre with university, college, museum and public
library.
™ Centre to cultural activity, sport and recreation events and convention at the national
and international level.
™ Have complete infrastructural facilities, adequate public utility include friendly public
parks especially to Disabled Persons (OKU). These include public transport facilities,
traffic management systems and efficient road network and ICT services; AND
™ Obtain certain recognition either at the national level or international in certain areas
parallel with its standard as a city.
™ Urban development that stresses steady development (sustainable development)
and focus its efforts to tackle municipal issues such as squatters, illegal factory
operations, security, housing for lower income group and environmental
conservation.
™ Indicators for sustainable cities such as those emphasized in Malaysia’s Urban
Indicator Network Systems (MURNInet) will also be accounted.
™ Image of city formation or suitable identity with the function and national culture which
symbolizes the history and heritage. Areas and buildings with its own culture and
unique architecture need to be cultivated such as Malacca heritage city.
™ Own industrial centres, financial institutions and carry out business and trade to
attract investors. These include hotel facilities to encourage tourism activity.
™ Give attention to the service sector and development of economic activity.

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 6.2 CRITERIA FOR A MUNICIPAL COUNCIL
The following are the criteria needed for municipal status
™ To obtain Municipal status, a district council must have a minimum of 150,000
residents and at least RM 20 million revenue per annum*.

™ Capital city or administrative centre for any State or district.

™ Have population not less than 150,000.

™ Have steady income from financial resources (sustainable) with annual

income* not less than RM20 million and able to provide proper services.

™ Have industrial activity, business, tourism and major housing development.

™ And planning activities which can be identified as potential to expansion of

business in the area and can generate job opportunities.

™ Has the capacity to provide opportunity to businesses by promoting growth

investment activity.

™ Have infrastructural facilities that are satisfactory and an efficient transport

system.

™ Have a sustainable concept of town planning.

™ Indicators for a sustainble city such as those emphasized in Malaysia’s Urban

Indicator Network System (MURNInet) will also be accounted;

™ Have programmes which can encourage local community participation such

as Local Agenda 21 (LA 21).

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6.3 CRITERIA FOR A DISTRICT COUNCIL
Lastly the following are the characteristics of a district
™ Other areas apart from major towns

™ Inhabitants less than 150,000 people

™ Total annual revenue less than RM20 million; and

™ Overall citizen needs focused to infrastructure facility and public utility

compared with services at municipal level.

6.4 THE CHARACTERISTICS OF EACH CATEGORY

All types of local government perform the same functions. Municipalities can be upgraded to
cities once they satisfy the required criteria. However, cities are led by mayors, while
municipalities and districts are led by presidents. They are appointed by their state
governments on either a part-time or full-time basis.

The state governments, elected every five years also appoints the councillors. The
appointments are for three-year terms, but individuals may be reappointed. This is uniform
across the country. The state government also sets remuneration for councilors.

The council decision-making process is through a committee structure determined by the

local authority, including the committees provided for in legislation. Councils can establish
other general or specific committees at their discretion.

Local councils are responsible for public health and sanitation, waste removal and
management, town planning, environmental protection and building control, social and
economic development and general maintenance functions of urban infrastructure.

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 The following are characteristics of local authorities in Malaysia.
6.4.1 City council
City Councils are defined as having a population of more than 500 000 people, being
a state administrative centre with commerce and industry, having a fast expending
economy with strong financial institutions, centre of higher education i.e. tertiary and
being financially autonomous with an annual revenue exceeding RM 500 million.

They are created by an Act of Parliament. ( Act 171). City Councilors are appointed
by their respective State governments except in the case of the City Halls. City Halls
consist of the City of Kuala Lumpur, North Kuching & Sabah. They have no
Councillors but have commisisioners or advisers headed by the Mayor and make
own their own laws.

The functions of city councils are city planning, environmental protection, building
control and public health and sanitation.

Executive powers lie with the mayor in the city councils and there are 24 councilors
appointed by the respective state governments.

6.4.1.1 The case of City Hall, Kuala Lumpur

What makes City Hall unique from other councils in Malaysia?
Dewan Bandaraya Kuala Lumpur or Kuala Lumpur City Hall (DBKL) is a local
authority which administrates Kuala Lumpur city centre and other areas in the
Federal Territory of Kuala Lumpur. This agency is under Federal Territories
Ministry of Malaysia. DBKL are responsible for public health and sanitation,
waste removal and management, town planning, environmental protection
and building control, social and economic development and general
maintenance functions of urban infrastructure.

Executive power lies with the mayor in the city hall, which is appointed for
every three years by the Federal Territories Minister since the local
government elections in Malaysia were suspended in 1970. There are two
DBKL main headquarters. The responsibility of managing the development of
Kuala Lumpur is entrusted to CHKL headed by the Mayor of Kuala Lumpur.

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 The Federal Capital Act 1960 provides for the appointment of an Advisory
Board to advise the Mayor. The Mayor is assisted by a Director General who
heads the administration of CHKL, which comprises 23 departments.

CHKL is one of the biggest employers in the City with over 8,000 employees
of which more than 300 are professionals and managers. The Mayor or Datuk
Bandar of Kuala Lumpur has always been the envy of mayors and presidents
of other local authorities in Malaysia.Among other things, he does not have 24
councillors, most of whom are politicians,to share power with. He only has
advisors whose advice he is not bound to follow

Kuala Lumpur City Hall also has an annual budget of nearly two billion ringgit,
which is much bigger than that of many state governments.It issues licences
for and regulates business activities, such as food outlets and workshops. It is
also the local planning and development control authority of the most
expensive real estate in the country. It is responsible for providing and
maintaining roads, drains and community facilities such as public open
spaces, parks and cemeteries. In addition, it performs other functions such as
urban planning, traffic management as well as management and enforcement
of business premises, hawkers and petty traders and public housing.

6.4.2 Municipal council

A municipality is an administrative entity composed of a clearly defined territory and
its population and commonly denotes a city, town, or village, or a small grouping of
them.

Municipal Councils are urban based, have an annual revenue of not less than 20
million , population of more than 150,000, be an administrative centre and have a
demand for urban services rather than infrastructural development. If the Council
expands it can ask the Conference of Rulers (9 Sultans) to bestow City Council
Status.

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 In most countries, a municipality is the smallest administrative subdivision to have its
own democratically elected representative leadership. In some countries,
municipalities are referred to as "communes". The term derives from the medieval
commune. In some countries, especially in the Middle East, the term "municipality" is
also used to refer to the municipal administrative building known elsewhere as the
town hall or city hall.

The largest municipalities can be found in Canada, Greenland, Iceland, Australia and
Brazil.

Municipal councils are created by an Act of Parliament

They have financial and administrative autonomy
They are headed by a chief executive – called the President
They have 24 councilors appointed by the respective state governments

6.4.3 District Councils

They are rural based and outside major centres, have a population of less than
150,000 living in dispersed settlements, annual revenue of less than RM 20 million
and lack capacity to discharge their functions. They can be upgraded to Municipal
Councils if they satisfy certain criteria. District councils are created by an Act of
Parliament. They are headed by a chief executive – called the President although in
the past the District Officer has also headed some of the District Councils.They
normally provide basic maintenance services only.

6.4.4 Functions of a Local Authority

The major functions of Malaysian local authorities can be summarized as
environmental, public, social and developmental.

(a) Environmental
This relates to functions of maintenance and improvement of the environment
within the area of jurisdiction. This includes obligatory services such as
cleansing, collection and disposal of solid wastes, proper drainage and
sewage, sewerage system and beautification programmes

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 (b) Public
(i) Public amenities
This applies to services such as abattoirs, veterinary services,
transportation, burial grounds and crematoria.

(ii) Public health and cleansing

This function includes the provision of sanitation and solid waste
management system, cleaning drains and roads and the general
upkeep of the environment. The licensing of hawkers, stall holders,
shop and business operators whose businesses are public nuisances
and obnoxious in nature falls under this function as well.

(c) Social
Some larger municipalities provide social services such as childcare centres,
clinics within their health care service programmes, ambulance and hearse
services. Besides these, they maintain fountains and arrange for lighting
public streets and other public services and provide manual labour and
facilities to state governments or the district offices to assist in the
organization of ad hoc social services at the state and district levels

(d) Developmental
As opposed to mandatory functions of the local authorities, the development
functions are considered "discretionary" under the Local Government Act,
1976. Even though local authorities could be regarded as an important
instrument for local socioeconomic modernization, the lack of financial and
physical capacity limits the extent and functions that they can provide. This is
particularly the case with district councils.

In the face of rapid growth and the pressure to fulfill multiple needs of the
local citizens and the private sector community, the scope of functions and
responsibilities of local authorities are expanding every day. The increase in
the rate of industrialization, trade, commerce and development of modern
services not only pushes the demand for urban space but also that of urban
support services.

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 With an increasing concentration of people and industries in urban areas, the
functions and responsibilities of local authorities too have significantly
expanded which can be summarized as follows:

™ Efficient service delivery functions and employment generation

™ The normal system maintenance function for public places,
drainage and sewerage, market places and crematorium, road
maintenance and streetlighting, landscaping and maintenance,
public health and sanitation
™ The development planning and control and management
functions (building control, land-use planning, development,
creation of industrial estates)
™ The promotion of tourism and urban renewal beautification
programmes; And
™ Infrastructure development and support facilities which could
facilitate industrial development and other local-based
economic development initiatives.

More important, this expansion of functions raises one fundamental issue;

How can local authorities become an effective machinery to facilitate national
growth and enhance the nation's competitive edge? In essence, local
authorities must now play a more effective role in urban planning,
development control and managing the urban system and its environment.
Such a role is important to ensure uninterrupted growth and sustainable
development within the context of maintaining national competitiveness in this
era of economic globalization. Besides, it imposes not only financial but also
administrative pressures on local authorities. These pressures come in the
form of new demands and challenges to increase and improve delivery of
urban services. The challenges also pose important and strategic questions
regarding their roles at local, national and global levels.It is noted that, in
performing the functions demanded , apart from the specific powers stated in
the Local Government Act 1976, the provision of section 101 of the Local
Government Act 1976 gives further power to the local authority to exercise
them functions accordingly.

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