Waqf and authority in Malaysia

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PRESENTATION OF TERM PAPER FOR ISLAMIC

ECONOMY (IFE 725)

WAQF AND AUTHORITY

AGENDA

INTRODUCTION

DEFINITION OF WAQFDALIL AUTHORITY ON WAQF (AL-QURAN)

DALIL AUTHORITY ON WAQF (HADIS)TYPE OF WAQF AND CREATION OF WAQFROLE AND FUNCTIONS OF WAQF IN MUSLIM SOCIETY AND ISLAMIC ECONOMY

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AGENDATHE HISTORY OF AUTHORITY ON ADMINSITRATION AND MANAGEMENT OF WAQF

MALAYSIAN LAW IN RELATION TO WAQF

THE AUTHORITY ON WAQF IN MALAYSIA AT STATE LEVEL

THE RESPONSIBILITIES AND FUNCTIONS OF SIRC IN RELATION TO WAQF PROPERTY

THE MANAGEMENT AND ADMINISTRATION SET UP OF SIRC ON WAQF

THE AUTHORITY ON WAQF IN MALAYSIA AT FEDERAL LEVEL

CONCLUSION

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INTRODUCTION*All wealth belongs to Allah. We are only trustee of the wealth and

to spend the wealth according to Syariah. In line with the name of Allah (Asma Ul Husna) Al Ghani ( الغنى) and Al Mughni (المغنى).

*Al Hud (11:61)

“To the Thamud People (We sent) Salih, one of their own brethren. He said: "O my people! Worship Allah. ye have no other god but Him. It is He Who hath produced you from the earth and settled you therein: then ask forgiveness of Him, and turn to Him (in repentance): for my Lord is (always) near, ready to answer."

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*Muslims are encouraged to give benevolent gift of charity to others such as hibbah, sadaqoh, infaq and waqf.

*Al-Imran (3:92)

“By no means shall ye attain righteousness unless ye give (freely) of that which ye love; and whatever ye give, of a truth Allah knoweth it well.”

INTRODUCTION

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*“Waqf” literally means ‘detention’ and connotes the tying up of property in perpetuity for the benefit of the public.

* In Islamic law, “waqf” denotes holding certain property and preserving it for the confined benefit of certain philanthropy and prohibiting any use or disposition of it outside its specific objective. An endowment of money or property made for benevolent reasons. (Kahf, 2007)

DEFINITION OF WAQF

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* In Malaysia the definition of waqf is incorporated in the states enactment governing the Islamic affair or waqf matter for that state -

“eg: Sec. 2 of Wakaf (State of Selangor) Enactment 1999 (No.7 Year 1999), “waqf” means the dedication of any property from which its usufruct or benefit may be used for any charitable purpose whether as wakaf am or wakaf khas according to Hukum Syarak, but does not include a trust which is defined under Trustee Act 1949 [Act 208].”.

DEFINITION OF WAQF

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*Waqf is not one of the Islamic pillars . No clear dalil in Al-Quran which use the word “waqf” in Al Quran.

*The dalil for benevolence charity gift even more emphasised by Allah SWT in surah Al Baqarah 2:261

“The parable of those who spend their substance in the way of Allah is that of a grain of corn: it groweth seven ears, and each ear Hath a hundred grains. Allah giveth manifold increase to whom He pleaseth: And Allah careth for all and He knoweth all things.”

DALIL AUTHORITY ON WAQF (AL-QURAN)

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* In Sahih Muslim’s Book of Bequest (Kitab al Wasiyya), Book 13, Chapter 5 on waqf, it stated the celebrated hadith of Rasulullah SAW on waqf when Rasulullah SAW advised Umar as regard to the land in Khaibar acquired by Umar

*Rasulullah SAW said “When the son of Adam dies, all his good deeds come to an end except three:ongoing charity, knowledge from which others may benefit after he is gone, and a righteous son who will pray for him." (Sahih Muslim)

DALIL AUTHORITY ON WAQF (HADIS)

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*2 types of waqf –(i) Waqf khairy or waqf am; and (ii) Waqf ahli.

* (i) Waqf khairy or waqf amA dedication of a property in perpetuity without any specific purposes or terms and conditions set by the person who created the waqf (waqif), as regards to the usage, beneficiaries who entitled for the waqf property and the revenue derived form the investment of the waqf property. If there is terms and conditions by the waqif on the waqf property, it is known as waqf khas .(Siraj 2012)

* (ii) Waqf ahli or waqf dhurriA family waqf which is created by the waqif

exclusively for the benefit of family members (including the founder) with two main objectives.

TYPE OF WAQF AND CREATION OF WAQF

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First, waqf ahli was created to keep the properties of family intact, to assure the entitlement of beneficiaries for the duration of the objects, and to regulate the transmission of usufructory rights from one generation to the next (Powers 1993).

Second, waqf ahli was utilised to limit fragmentations of real property through the Islamic inheritance laws or confiscation by rulers and the state (Doumani 1998; Lev 2005).

*For the purpose of creation of waqf the are four pillars to be satisfied which are – (i) the person who created the waqf

(waqif), (ii) the waqf property (al-mauquf), (iii) the beneficiary of the waqf property (al

mauquf alaihi); and (iv) the legal statement for creation of waqf

(al-sighah).

TYPE OF WAQF AND CREATION OF WAQF

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*When a muslim creates waqf, he give away his right of ownership to his property to the State or Baitul Mal in perpetuity for the State or Baitul Mal to manage, administer and use the property for the purpose of public interest at large, but subject to the terms and conditions set out by him. (Siraj 2012)

*Waqf play great role in the society and the economy of Islamic state, where it will be used by the state or baitul mal for the specific purpose as specified by the waqif such as, school, hospital, mosque or even graveyard for example the University Al Azhar in Cairo, the University of Cordova Spain, and the Al Noori Hospital in Damascus. (Ahmad Zaki et al., 2008)

ROLE AND FUNCTIONS OF WAQF IN MUSLIM SOCIETY AND ISLAMIC

ECONOMY

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*Waqf property would ease the burden of the state to provide public facility and capable generate income when the state collecting its revenue from the rent out or lease of the waqf property. The revenue derived will be rolled over by the state for the benefits of muslim society.

* In 2009, the are about 10,000 hectares undeveloped waqf land value at RM1.9 billion, only 0.72% is being develop (Utusan Malaysia, 2009).

*Shows that muslim in Malaysia is well aware of waqf but also shows the weakness part of the authority to develop the waqf property to its maximum potential of generating income revenue to the muslim society and the state economy.

ROLE AND FUNCTIONS OF WAQF IN MUSLIM SOCIETY AND ISLAMIC

ECONOMY

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* No clear evidence on the authority body managed and administered the waqf property systematically during the time of Rasulullah SAW or the Khulafa Ar-Rashidin as waqf is not commonly practice during that particular time.

* The management of waqf is actually a private management in nature -(i) The owner of the property who waqf the property (waqif) may

manage and administer the waqf himself or he may appoint another party as a trustee (mutawalli) to manage and administer the waqf property in accordance to the terms and conditions set by the waqif.

(ii) The appointment of mutawalli has to be documented in a trust deed called waqfiyya outlining in detail the purpose of the waqf, the duty and responsibilities of the mutawalli, compensation for the mutawalli for his effort on managing and administering the waqf, if any (Siraj 2012)

THE HISTORY OF AUTHORITY ON ADMINSITRATION AND MANAGEMENT

OF WAQF

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* The Hanafi and Syafie school of laws allow the waqif or member of the waqif family to be the administrator to the waqf property. The Maliki school of law does not allow the waqif or his family member to be the administrator.

*Waqf was at its peak during the Ottoman Empire (1299-1923). The supervision on the public waqf property is by the Islamic courts. The private waqf, the management and administration is either done by the waqif or mutawalli. Towards the end of the Ottoman Empire, the supervision of the private waqf and public waqf was transferred from individually or the Islamic courts to be directly under the the Ministry of Waqf (Mohsin 2009).

* Presently, the main purpose for the government to become the trustee for waqf property is for reorganisation, modernisation and development of waqf institution which would not always be feasible by private entities or individuals (Siraj 2012).

THE HISTORY OF AUTHORITY ON ADMINSITRATION AND MANAGEMENT

OF WAQF

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* In Malaysia, the matters related to waqf fall under the jurisdiction of the states and not under the jurisdiction of the federal authority.

* The relevant laws stating the jurisdiction are the Article 3, 74, 77, List II, the State List of the Ninth Schedule of the Federal Constitution and the sec. 25 of the Civil Laws Act 1956.

* Waqf is under the Administration of Islamic Law Enactment of each states in Malaysia for example -

(i) Administration of Islamic Law (Federal Territories) Act 1993 (Act 505),

(ii) Wakaf (State of Selangor) Enactment 1999 (No.7 Year 1999),

(iii) Wakaf (State of Malacca) Enactment 2005 (No.5 Year 2005); and

(iv) Wakaf Enactment (Negeri Sembilan) 2005.


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* Some federal laws of Malaysia applicable to the administration and management of waqf immoveable property.

(i) The National Land Code 1965;(ii) Trustee Act 1949 (Act 208);(iii) Specific Relief Act 1950; and(iv) Contracts Act 1950. (Nor Asiah, 2012)


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* The State Islamic Religious Council (SIRC) was appointed by the states enactment governing the Islamic affairs as the sole trustee of the waqf property for the purpose of improve the efficiency and effectiveness of the management of waqf. SIRC are provided with the authority to appoint any individual or a committee to act as its representative to execute the administrative duties of the trusteeship of the waqf property (Siraj 2012).

* Two main functions of SIRC are to –

(i) assist and advise the Rulers or Governors on matters relating to Islam and Malay customs; and

(ii) develop policies on Islamic matters which include matters related to waqf. SIRC is the highest authority on the administration of Islam in state governments.

THE AUTHORITY ON WAQF IN MALAYSIA AT STATE LEVEL

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* 4 main responsibilities and functions of SIRC on waqf –

(i) is to ensure that the waqf property manage and administer by them is being used, spend or utilised in accordance to the purpose and terms and conditions set out by the waqif . All the relevant documents in relation to the waqf property shall be in the safe keeping of the SIRC. If the waqf property is involving land, SIRC shall be responsible to transfer the rights of ownership from the waqif to SIRC and to maintain the waqf land or building.

(ii) to safeguard of the waqf property where the SIRC may develop and apply specific laws, rules and procedures to govern the management and administration of waqf property both on the administrative and financial aspects.

THE RESPONSIBILITIES AND FUNCTIONS OF SIRC IN RELATION TO

WAQF PROPERTY

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(iii) to develop the waqf property manage and administer by them. The SIRC is responsible to find investors or to create a joint development with an investor, to develop the waqf property in accordance to the terms and conditions sets by the waqif when he created the waqf.

(iv) reporting of the performance of the waqf management. asserted that the lack of transparency in the management of waqf contributed to the lack of public confidence to endow their assets and funds as waqf. Each state enactment states the requirement to produce relevant financial statements and accounts mainly for the purpose of auditing and reporting (gazetting). (Siraj, 2012)

THE RESPONSIBILITIES AND FUNCTIONS OF SIRC IN RELATION TO

WAQF PROPERTY

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*3 types of administration set up of waqf property by the relevant SIRC -

(i) Penang SIRC set up a specific waqf division to be in charge of the overall management and administration of waqf. Its allow concentration on its objectives and maximize it human resources.

(ii) Most of SIRC set up a sub unit for waqf in a division which is also responsible and in charge of the zakah and baitul mal. This type of set up are employed by Perlis, Kedah, Perak, Selangor, Negeri Sembilan, Malacca, Johor, Pahang, Terengganu, Kelantan, and the Federal Territories of Kuala Lumpur.

THE MANAGEMENT AND ADMINISTRATION SET UP OF SIRC ON

WAQF

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*SIRC also is authorised to set up a special committee with the objective to strengthen the management and administration of waqf. For instance, (a) Selangor : the Wakaf Management Committee. (b) Perak : the State Wakaf Control Committee (c) Federal Territories of Kuala Lumpur : the Development and

Investment Committee to deal with the development and investment of waqf property.

(iii) Corporatisation of the baitul mal management, which is also responsible for the management and administration of waqf for the improvement the effectiveness and efficiency of the delivery systems. Sabah and Sarawak has corporatised their Baitul Mal

THE MANAGEMENT AND ADMINISTRATION SET UP OF SIRC ON

WAQF

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*At the Federal level, the affairs of Islamic matters are under the supervision of a Minister in the Prime Minister’s Department. The federal government has taken its initiative to play its integral role assisting the SIRC to overcome some of the common known problems to the SIRC in managing and administering the waqf property and the development of waqf property.

*The common problems face by the SIRC are as follows -

(i) Legal aspects: Various states laws enactment and lack of standardization of such laws would have lead in different of the implementation of waqf property management.

(ii) Financial resources: Lack of financial resources of SIRC are the main reason for undevelop waqf property. The private and commercial sector is not keen to develop waqf land due to its restricted purposes as set out by the waqif and the return of their investment and profit of developing the waqf property may takes a long time materialise through rental or lease of the waqf property. Financial support from the federal government is very restricted.


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(iii) Human resources: Two major problems face are due to lack of

the supply for human resources and lack of expertise of the human resources to undertake the management and administration of the waqf property. SIRC require the expertise in the field of investment, project management, marketing or property evaluation for the purpose of developing the waqf property to its full potential usage and purpose. (Siraj, 2012)

(iv) Waqf property : Some of the development of the waqf property is

being hampered due to the nature of the waqf property where some of the waqf property is under a leasehold and not perpetual in nature or non existence of land title to the waqf property. Some of the waqf property are located in the rural area or due to the insignificant size of the waqf property, which does not commercially potential to be develop.


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(i) Jabatan Kemajuan Islam Malaysia (JAKIM)

Established in 1 January 1997. Its objective is to develop and establish policies on the development and advancement of Islamic affairs in Malaysia, to promote the sanctity of Islam, coordinating the process of enacting and uniformity of the implementation of the procedures and islamic states laws. JAKIM works closely with the SIRC in the planning and the implementation of Islamic affairs are consistent throughout the 14 states in Malaysia. JAKIM is directly involve with the improvement of the process and procedure for waqf property management and administration in the respective state.

(ii) Jabatan Awqaf, Zakat dan Haji (JAWHAR)

Its primary objectives is to strengthen and systematically improve over all management of waqf property in Malaysia. Its Waqf Division has set out fundamental objectives with regard to the waqf management and administration by SIRC such as coordinating the waqf administrative systems, overseeing the overall development of waqf and providing advisory services for organisational development.


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(iii) Yayasan Waqaf Malaysia (YKM)

On 23 July 2008, the federal government through JAWHAR has established Yayasan Waqaf Malaysia. Yayasan Waqaf Malaysia was set up under the Trustees Incorporation Ordinance 1952 following the resolutions of the National Waqf Convention held in 2006. The vision of Yayasan Waqaf Malaysia is to be the leading organisation in strengthening the ummah agenda through enhancing the waqf instrument.

There are 5 main fundamental objectives for the establishment of Yayasan Waqaf Malaysia which are as follows -

(i) To accumulate waqf fund or porpertiesYayasan Waqaf Malaysia shall conducting programmes to accumulate funds for the Tabung Kumpulan Wang Amanah Yayasan as economic capital for the Muslim society.


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(ii) Developing waqf properties In collaborations with the SIRC and institutes of higher learning, Yayasan Waqaf Malaysia shall do research to develop and enhance waqf properties

(iii) Investment of waqf propertiesYayasan Waqaf Malaysia shall invest the available of waqf funds or properties in Syariah compliant activities and programmes. YayasanWaqaf Malaysia has actively makes investment of the waqf fund such as hotel management, constructing shop lots for rental and education such as Akademi Kulinari Terengganu

(iv) Social and welfare programmes Yayasan Waqaf Malaysia shall also be involved in social and welfare programmes such as sponsorship of students’ learning programmes and providing necessary assistance to the needy and the poor.

(v) Promotions and publications The Foundation shall engage in conferences, seminars and intellectual discourses as well as publications to disseminate its missions more widely. (Siraj 2012)


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*Needs for a more reform and uniformity of waqf management and administration in Malaysia especially in the legal frame work and financial aspect.

* It is suggested a standard laws in relation to waqf be enacted and be adopted by each state so that there are uniformity in the law with regard to the power and authority for the development of waqf property.

*The financial aspect for the development of waqf property should also need to be look into. It is clear that due to lack of financial resources, most of the waqf property was not being able to be developed.

CONCLUSION

Waqf and authority in Malaysia

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