Definition

Section 2 of Local Govt Act 1976 (Act

171):
Any City Council, Municipal Council or
District Council of the States and in relation
to the Federal Territory means the
Commissioner of City of Kuala Lumpur
appointed under Section 3 of Federal capital
Act 1960
Formation and Administration
Has a defined acts, a population, an
organisation and the authority to undertake
and power to carry out their functions.
Sec 13 as a corporate body
Sec 8 affairs of every L.A area will be
administered by L.A
Sec 9 state or federal territory may issue
directions must consistent with Act
Continued
Sec 10 elaborate on the appointment,
terms
Sec 28 appointments of committees

National Council for Local
Authority
Article 95A of Federal Constitution
requires the formation of a Council to
control LA
Duties to formulate national policy for the
promotion, development and control of LA
after consulting Federal & State government
NCLG acts as an agency to ensure
uniformity on policies & law matters

Continued
Comprise of:
Minister of Housing and Local Govt as
chairman
Representative from state
Max of 10 from Federal Govt

Section 10 Councillors
Councillors shall be appointed where
majority are persons ordinarily of residents
in the local area who:
Have wide experience in local govt affairs
Have achieved distinction in any profession,
commerce or industry
Capable of representing the interests of their
communities in the local authority area
Continued
Term of office shall not exceed 3 years and
eligible for reappointment upon the expires
of his term of office
The seat of a Councillor may be vacant due
to:
Resignation
Disqualified under section 34(7)
Appoinment is revoked by state authority
Parent Laws
There are 3:
Local Government Act 1976 (Act 171)
Town & Country Planning Act 1976 (Act 172)
Street, drainage & Building Act 1974 (Act 133)
Categories of major functions
Environment
cleaning, collection & disposal of solid waste,
drainage & sewerage & beautification
programmes
Public Amenities
abbatoirs, veterinary services, transportation burial
ground & crematoria
Public health cleansing
sanitation, drainage, road & general upkeeping,
licensing hawkers, public nuisance etc.

Functions of Local Authority
Mandatory function
all critical functions such as refuse
collection, public health, streets lighting
Discretionary function
all development functions such as
recreational parks, town beautification,
housing and commercial.
Loan (Sec 41)
Raise loan from time to time by resolution
and consent of State Authority
Approval from state authority for purpose:
1. Pay expenses incurred to/ be incurred for
Acquisition of land
Contruction of building
Execution of permanent work & provision of
renewal for plant & vehicle

Continued
2. To pay off existing loans provided:
- loan shall not make total debt of LA
more than 5 times of annual value
of valuation list
- repayment period not more 60 years
Sec 46 borrowing powers for special purpose
Sec 47 loan by govt
Sec 49 advances by way of overdraft
Sources of Finance
Section 39 the revenue of local authority
consists of:
All taxes, rates, rents, licence fees, dues and other
charges
Profits from any trade, service or undertakings
All interests on any monies invested & all incomes
arising from property
Grants ( launching grant, annual grant, infrastructure
grant), contributions, endowments & others
Continued
Section 41 power of LA to raise loan
Section 46 borrowing powers for special
purpose
Section 47 loans from federal & state govt
Section 48 loans to be first charge on
revenue and assets
Section 49 advances by way of overdraft
Local Authority Fund
Section 40 all moneys received by the local
authority by virtue of this act or any written law
shall constitute a fund known as the Local
Authority Fund which becomes vested in and
under the direction and control of the local
authority.
Shall be kept on current or deposit account with
one or more banks & may be invested
All orders or cheques against the Fund shall be
signed by two officers authorised in writing by
local authority.

Resource Allocation
Section 55 Annual estimates
Not later than 10
th
day of November
Copy of draft estimates deliver to each Councillor not
later than 7 days before meeting
LA may pass, modify, reject or add
Forwarded to State Authority not later than 20
th

November and be considered by state not later than 31
December.
Budget summary shall be published in the Gazette
Section 56 Supplementary estimates
Accounts and Audit
Section 53 books and accounts shall be kept and
open to inspection
Section 54 financial year 12 months ending on
31 December of each year
Annual statement shall be laid before the Local
Authority not later than its first Ordinary meeting
in the month of May
The accounts shall contain information as required
by the State Authority Statement of Revenue and
Expenditure, Balance Sheet & other supporting
statements.
Section 60 Audit of Accounts
Audit will be undertaken by the Auditor general or other
auditor appointed by the State Authority on the
recommendation of AG
It is the duty of auditor to submit to Local Authority on or
before 31 October in each year in respect of the preceding
financial year of an annual observation on account and to
certify:
The accounts were in order
Separate accounts of all commercial undertakings had
been kept
The accounts presented a true and fair view of the
financial position of LA
Provisions made for redemption and repayment of all
monies borrowed by LA


Continued
The amount set aside for depreciation & renewal of
all assets were adequate
All the requirements of the auditor had been complied
with
The audited accounts & auditors observations
shall be laid before the LA and published in the
Gazette
A copy of the statements & accounts shall be
forwarded to State Authority to be laid & tabled
to State Authority to laid to the State
Legislative Assembly & House of Rep.