I WAS surprised to read that town councils sank part of their funds into Lehman Brothers-linked Minibonds.

Dr Teo Ho Pin, coordinating chairman of the 14 People's Action Party town councils, has said that the investments make up a small percentage of town councils' total funds.

However, should town councils use public funds for such risky investments?

What will happen if there is a loss? Who will be held responsible for it? Will the loss be made good by the Government? What other instruments are the funds being invested in?

As the public contributes to these funds, it has a right to know.

Most of the HDB dwellers who contribute would not want their money to be invested in such risky investments, despite their potentially good returns.

Most, if not all the funds, should be held in safe instruments such as fixed deposits or government bonds.

Town councils are not the same as the Government of Singapore Investment Corporation or Temasek Holdings, whose main duty is to invest funds for generous returns.

Their job is to maintain an estate.

Funds should be used for this purpose, and should there be a huge surplus, it could be used to offset the service and conservancy charges, which would be a welcome move during the current financial crisis.

Could more details be provided on the amount of town-council funds being invested in instruments such as Minibonds, and the losses which have been incurred?

Mr Gilbert Goh Keow Wah
Sydney, Australia

For more my paper stories click here.