The problems at Aljunied-Hougang-Punggol East Town Council (AHPETC) have come about because no one wanted to work with the town council, said Workers' Party (WP) chief Low Thia Kiang.
It had to pay its managing agent higher fees because no other established managing agent would work with it, he added.
In the second day of debate on the audit report into AHPETC, Mr Low responded to Education Minister Heng Swee Kiat's speech in Parliament yesterday, where he repeatedly called on the WP, which runs the town council, to explain the state of affairs at AHPETC.
On Monday, an audit report into AHPETC was made public by the Auditor-General's Office (AGO), which pointed out several lapses in the town council's bookkeeping.
This included not being able to manage its service and conservancy charges (S&CC) arrears, not transferring monies to the sinking fund every quarter as needed, and not fully disclosing that senior town council officials were also owners of the managing agent.
Minister for National Development Khaw Boon Wan moved a motion in Parliament on Thursday to debate the report.
At the end of the two-day debate yesterday, all 85 MPs present, including the nine WP MPs, voted for the motion, which called on the House to note the report "with concern".
Earlier in the debate, MPs from the PAP repeatedly called for the WP to explain what happened, with the harshest words coming from Law Minister K. Shanmugam on Thursday. He accused the WP of "taking money from the man on the street to give to your friends".
In response, Mr Low said the WP would take responsibility, and each of its MPs would be speaking in Parliament to explain various aspects of the AGO report.
He had on Thursday said the WP supported Mr Khaw's motion related to the AGO audit report, which was a year in the making.
Yesterday, AHPETC vice-chairmen Png Eng Huat and Pritam Singh, as well as Punggol East MP Lee Li Lian each rose to speak.
ISSUES WITH MOM
Ms Lee told the House that shortly after taking over Punggol East in January 2013, one of the conservancy contractors for the constituency said they could not continue providing their services because of "issues they were having with the Ministry of Manpower".
A tender was called and two established cleaning companies were in the running for the contract.
But just before the tender meeting in April 2013, both companies pulled out of the tender process "without any valid reasons", Ms Lee said.
"Regardless of political affiliations, residents' interests should always be the priority and there should not be elements of political preference or fear," she added.
Mr Singh, in his speech, reassured the House that AHPETC's managing agents do not have a say in who is awarded any tender.
If the managing agent's company is involved in it, a "Chinese wall" is built between the agent and the town council, so no information gets out to them regarding the awarding of contracts.
When the agent is not tendering for a contract, their role is "purely administrative".
Earlier in the session, Senior Minister of State for Finance and Transport Josephine Teo clashed with Mr Png when she challenged him to cite instances when the AGO found similar lapses in ministries and statutory boards as it did in AHPETC's accounts.
Mr Png had mentioned a list of ministries and statutory boards where the AGO had found discrepancies during their yearly audits.
Mrs Teo asked: "I'd like to know whether Mr Png is aware of any other occasion that the AGO has drawn the same conclusion for a government ministry or statutory board?"
Mr Png replied that it was his intention to show that lapses occur, and he was not trying to equate the conclusions in the AGO's AHPETC audit with the ones in its regular audits.
"I'm not saying that because AHPETC was tabled in Parliament. But I'm just citing that the AGO's work is thorough, fair, and I respect that," he added.
This is not about PAP versus WP
The AHPETC saga shares similarities with the one involving the National Kidney Foundation (NKF), said National Development Minister Khaw Boon Wan (right) in his speech rounding up the debate.
In 2005, former NKF chief executive T.T. Durai took out a defamation suit against Singapore Press Holdings, after news reports exposed lapses in NKF's corporate governance.
Following government investigations into the charity, Mr Durai and the NKF board resigned.
Said Mr Khaw yesterday: "The Charities Act (back then) lacked teeth. But the new NKF board was able to sue the old NKF board and Mr T.T. Durai in the civil court. I am not sure if this may happen in the case of the town council."
He repeatedly called on Workers' Party (WP) chief Low Thia Kiang to "take ownership" in the matter and take action against the town council's managing agent, instead of waiting for the Government to send in the Corrupt Practices Investigation Bureau or the Commercial Affairs Department.
"I expect him to take action against the (managing agent) for their monumental incompetence," he added.
Mr Khaw called it a "painful debate" but reiterated that this is an issue about responsible governance.
He said: "This motion is not about PAP versus WP. This motion is about Singapore.
"This is about us assuring Singaporeans that as MPs, we uphold the highest standards of governance, to safeguard our residents' well-being and interests, and to protect the public monies entrusted to our town councils."
Earlier during the sitting, various People's Action Party (PAP) MPs called on the WP to explain their actions, instead of blaming the situation on not being able to find a managing agent.
Mr Hri Kumar Nair called it a "red herring", since some town councils, like Bishan-Toa Payoh GRC, run the town themselves.
He and MP Liang Eng Hwa noted that members of the public have told them not to "attack the WP", or the ruling party would be accused of bullying the opposition.
"I could not get my head round it - has it really come to this?" asked Mr Nair. "This is really a matter involving public funds, how could anyone with good conscience ignore what the AGO (Auditor-General's Office) and (auditor) PricewaterhouseCoopers have found? These are not partisan."
Mr Liang said: "An auditor friend asked me why PAP is doing the WP a favour by helping them get their house in order? And then be accused of bullying the WP?
"But what we are concerned about is public money, and that the WP is bullying its own residents."
This article was first published on Feb 14, 2015.
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