African Journal of Business Management Vol. 5(26), pp. 10841-10845, 28 October, 2011 Available online at http://www.academicjournals.org/AJBM DOI: 10.5897/AJBM11.1445 ISSN 1993-8233 ©2011 Academic Journals Full Length Research Paper The future challenges of local authorities in Malaysia: A case study in Seberang Perai, Penang Kamarudin Ngah 1 , Zaherawati Zakaria 2 *, Nazni Noordin 2 , Mahazril ‘Aini Yaacob 2 , Jamaludin Mustaffa 3 and Mohd Zool Hilmie Mohamed Sawal 4 1 Pusat Penyelidikan Dasar dan Kajian Antarabangsa (CenPRIS), Universiti Sains Malaysia (USM), Pulau Pinang, Malaysia. 2 Faculty of Administrative Science and Policy Studies, Universiti Teknologi MARA, P. O. Box 187, 08400 Merbok, Kedah, Malaysia. 3 College of Arts and Science, Universiti Utara Malaysia, 06010 Sintok, Kedah, Malaysia. 4 Faculty of Information Management, Universiti Teknologi MARA, P. O. Box 187, 08400 Merbok, Kedah, Malaysia. Accepted 24 August, 2011 Local authorities nowadays are faced with many challenges in running their business with rapid development in social, economic and politics as well. The ability to overcome current issues and the readiness to face future challenges are estimated differently between one local authority and another. Local authorities whom are equipped with strong finance, visionary leadership, systematic strategic and action planning and public support will definitely be more prepared to face those challenges. On the other hand, weaker local authorities in financial and effective administration may be faced with problems in its area. Therefore, the objective of this study is to examine the level of issues and challenges facing the council which served the public and the approach applied to this study. Several major findings were obtained from the use of a set of questionnaire on the issues and challenges of local authorities in Malaysia, by referring to Seberang Perai Municipality Council as a case study, and some information in the questionnaires were handed over to the Ministry of Housing and Local Government (MHLG). Thus, few recommendations were proposed to its council in designing better approach to public service. In future research, the local government should be firm in addressing issues and challenges by having good instrument to be measured in their core business. The council should have close relationship with the stakeholders such as the government, non government organizations (NGO’s), business communities and public as well, to deal with continuous issues and challenges in local affairs at large. Key words: Local authority, issues and challenges, strategic planning, urban planning. INTRODUCTION Local government is the third level of government institution that is given authority to administrate, plan and *Corresponding author. E-mail: zaherawati@kedah.uitm.edu.my. Tel: +604- 4562565. MPSP; Majlis Perbandaran Seberang Perai , MHLG; Ministry Of Housing And Local Government, NGO’s; Non Government Organizations, CEO; Chief Executive Officer, LED; Local Economy Development, NSPSWM; National Strategic Plan For Solid Waste Management, SLGGA; Smart Local Government Governance Agenda. enforce assigned responsibilities in a local area. The function is to provide all societal facilities that are being charted according to Section 101 and 102 of the Local Government Act 1976, Act 171 and Section 5(1) (Malaysia, 1976a) and 6(1) of the Town and Country Planning Act 1976, Act 172 (Malaysia, 1976b). Traditionally, local authorities‟ role is to provide municipal and maintenance services, planning and control of land use, enforcement and supervision on development pro- jects, besides managing and controlling financial budget and tax revenue in their administration areas. Issues and challenges faced by local authorities are mostly related to the areas and effectiveness of such functions.