If lapses of the kind uncovered in the Workers' Party-run town council were found in a listed company or charity, there would be calls for the removal of the top decision-makers and directors, National Development Minister Khaw Boon Wan said yesterday.
"In Japan, the chairman and chief executive would call a press conference and take a deep bow. In the good old days, they may even commit hara-kiri," he said.
Punishments are prescribed in the Companies Act and the Charities Act for those who breach rules, he said, but town councils are not under such laws.
Instead, they come under the Town Councils Act, which deliberately takes a light-touch approach to regulation and enforcement.
He said MPs were given more authority and responsibility over the HDB estates in their constituencies:
"The strategic intent was to bring home to the MPs that how they manage and run their town council will affect their electoral fortunes at the next election, and to voters, that the MPs they elect will be responsible for looking after their housing estates.
"This would enhance accountability, push MPs to focus on what mattered to residents and... encourage voters to scrutinise more closely the capabilities and track record of election candidates."
He was highlighting the seriousness of the findings in the Auditor-General's Office's report on Aljunied-Hougang-Punggol East Town Council (AHPETC).
The report, which found lapses in governance and compliance with financial rules, confirmed that "something is seriously wrong at the AHPETC".
It painted a picture of financial mismanagement, incompetence and negligence in corporate governance.