By Clarissa Oon

AS HEALTH Minister, Mr Khaw Boon Wan sees similarities between managing Sars and managing the current controversy over the investment of town councils' surplus funds.
For four months in 2003, Mr Khaw led Singapore's fight against the then-unknown and deadly Sars virus.

Mr Khaw likens the 'still evolving' nature of the current financial turmoil - the backdrop for the town councils' investment losses - to the unpredictability and volatility of the Sars experience.

In communicating with the public in such crises, he says, one thing he has learned is that 'complete openness' from leaders is the best policy.

This is not always easy, he says.

Mr Khaw offered this perspective in an interview during which he explained why the councils did not disclose immediately their exposure to Lehman-linked products after the collapse of the investment bank Lehman Brothers.

In 'hindsight', it is 'easy to criticise' the town councils for being slow to disclose the extent of their sinking funds' exposure to troubled structured products linked to Lehman Brothers.

The fact is, they needed time to determine which of their investments were at risk, he says. Such information was not at their fingertips and they would have to do some checking.

'When there is $200-odd million in the account, it's a huge array of investment products', handled by various investment managers. The town councils would have to meet these managers and find out which investments were exposed to what kind of Lehman-linked products. 'It does not mean that all Lehman-linked products are in trouble.'

He believes the time lag came about because 'I think they were trying to be complete in their reply'.

It took about three weeks, from the time the issue of the town councils' exposure surfaced in October to when the numbers were revealed in Parliament on Nov 17, in response to a question from Nominated MP Eunice Olsen.

Mr Khaw puts the town councils' dilemma over what to make public in this way: 'If you say too little, people will say you're covering up.'

However, 'if you say too much and are proven wrong because at that point in time that was the best information you had, people will say you were lying'.

What Sars taught him, which he has always shared within his Ministry, is that 'complete openness always pays better'.

It means that 'if you don't know, say you don't know'.

For example, in May 2003, there was a cluster of 24 patients and three nurses from the Institute of Mental Health who were taken to Tan Tock Seng Hospital with fever, and were feared to have Sars.

Although it was not certain at the time whether they had the deadly virus, Mr Khaw and his team shared with the public that there was the 'threat of a cluster' and 'pre-emptive steps' were being taken.

Summing up the approach, he says: 'We do not know whether (the threat) is real or not, but I share what I know with you, and also what I don't know.'

Along the way, 'hopefully, day by day, hour by hour as we share, we educate each other. And I always find that is the best policy'.

Town council leaders could have taken a leaf from that approach as 'more communication is always better than less communication'. But all that is 'water under the bridge' now, he adds.

'The key point is: Let's come out of this better informed, better educated along the way and hopefully more bonded too. As I said, I see the biggest positive point from this as public interest and engagement.'

This article was first published in The Straits Times on December 19, 2008.