Urban Renewal Bill Flawed Threat To Communities

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 G25 Malaysia is deeply concerned by the tabling of the Urban Renewal Bill 2025, which has now been postponed during its second reading in the Dewan Rakyat following strong public backlash.
While the goal of revitalising ageing urban areas is legitimate, the implementation proposed in the current bill is gravely flawed, risks violating constitutional protections, and threatens to entrench inequality in cities.
At the heart of the controversy is Article 13 of the Federal Constitution, which guarantees every Malaysian the right to property.
Despite the minister’s recent decision to standardise all consent thresholds to 80 percent regardless of the age of the buildings, this means that even if up to 20 percent of owners object, their rights can be overridden.
The proposed bill creates a dangerous precedent where private property can effectively be seized through manufactured consent.
G25 Malaysia strongly supports the call of civil society groups, such as KLRA+SD, that the consent threshold must be near-unanimous, at least 95 percent, for inhabited buildings not in imminent danger.
Groups including KLRA+SD opposing the proposed lawWithout clear protection of homeowners’ interests and independent checks and balances, lowering the threshold risks violating the Federal Constitution and disregarding minority interests.
Excessive minister power, weak oversight
The bill centralises extraordinary powers in the hands of politicians and opaque executive committees, with little independent oversight.
These committees are dominated by government appointees and exclude independent professionals, civil society, homeowners, and resident representatives.
Without independent oversight, open tendering, or transparent auditing of consent, the bill risks becoming a vehicle for political patronage and developer-oriented interests.
The bill empowers “approved developers”, who are determined by the minister, to acquire land compulsorily under the Land Acquisition Act (LAA) once an area is declared a renewal zone.
Areas in Peninsular Malaysia with renewal potentialThis paves the way for land grabs disguised as urban renewal. Civil society has rightly called for strict limits on the use of compulsory acquisition, confining it only to technical reasons such as deceased or untraceable owners.
Anything broader opens the door to dispossession of ordinary Malaysians for private gain.
Inadequate compensation and protection
The bill promises “benefits not less favourable” than before, but leaves the details vague and subject to ministerial discretion. This is grossly insufficient.
Fair compensation must go beyond cash payments. It must include one-to-one replacement housing of equivalent size and location, first right of return for displaced residents, coverage of transitional costs such as rental, moving expenses, and legal fees, as well as profit-sharing mechanisms reflecting the future development value.
Without these guarantees in the body of the law, the promise of “fair compensation” is nothing more than rhetoric.
The bill also recognises only proprietors as stakeholders, ignoring tenants, sub-tenants, and informal occupants who form the backbone of urban communities. These are the groups most vulnerable to displacement, yet the law denies them a voice.
Urban renewal should be about improving lives, not uprooting them. Tenants must be given legal standing in consultation and guaranteed rehousing or rent-to-own options in redeveloped projects. Ignoring them will deepen urban poverty and fuel gentrification.
Social and political risks
The bill risks fuelling gentrification and racial polarisation by systematically displacing lower-income and minority homeowners to the urban periphery.
It also erodes public trust in institutions by sidelining meaningful consultation, fuelling calls for local government elections that the federal government has long resisted.
Urban renewal, if badly executed, becomes urban uprooting that enriches developers while tearing apart communities.
Malaysia, as host of the UN-Habitat Assembly (2025–2029), which the minister himself has been very proud of, should be leading by example in sustainable, community-centred renewal and not passing a law that incentivises demolition for developers’ profit.
Our call to return to the drawing board
G25 Malaysia urges the Madani government to withdraw the current bill in its entirety and return to the drawing board. Specifically, we call for:
Restore constitutional safeguards
- Raise consent thresholds to at least 95 percent.
- Remove “deemed consent” and other procedural traps for vulnerable groups.
Guarantee fair compensation and rehousing
- Enshrine one-to-one replacement, first-right-to-return, transitional cost coverage, and profit-sharing in law.
Recognise all stakeholders
- Provide tenants and sub-tenants with legal standing and protection.
- Strengthen PPR and rent-to-own schemes.
Establish independent oversight
- Create a statutory Urban Renewal Tribunal and an independent Housing Development Board or Oversight Commission.
- Mandate open tendering and publish a federal register of qualified developers.
Prioritise sustainability
- Codify social and environmental impact assessments for all projects.
- Make adaptive reuse and embodied carbon reduction the first priority before demolition.
Embed genuine public participation
- Reopen the bill for public consultation.
- Ensure representation of NGOs, professional bodies, homeowners, and residents in governance structures.
Protect rights, build sustainable cities
Malaysia urgently needs a framework to manage urban renewal, but the current bill, in its rushed and flawed form, is not the answer.
It violates constitutional rights, tilts power towards developers, weakens oversight, and risks tearing communities apart.
Urban renewal must not be reduced to a profit-making exercise benefiting the minister’s “approved developers”.
It must be about preserving dignity, protecting rights, and building sustainable cities where all Malaysians, whether homeowners, tenants, young, or old, can thrive together.
G25 Malaysia stands with civil society in calling for a complete rethink of the Urban Renewal Bill 2025. The Madani government must pause, listen, reflect, and legislate with the people, not against them. - Mkini
G25 is a group of influential Malays advocating moderation, constitutional rights, justice, and good governance in Malaysia.
The views expressed here are those of the author/contributor and do not necessarily represent the views of MMKtT.

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