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AIM: What is it all about?

The WP said AIM terminated its contract with Aljunied-Hougang Town Council (AHTC), which is why the council got a red grade for service and conservancy charge arrears. -TNP
Esther Ng and Elizabeth Law

Mon, Dec 31, 2012
The New Paper

AT THE centre of the dispute between the People's Action Party (PAP) and the Workers' Party (WP) is a company called Action Information Management (AIM).

Three of its directors are former PAP MPs.

The WP said AIM terminated its contract with Aljunied-Hougang Town Council (AHTC), which is why the council got a red grade for service and conservancy charge arrears.

The PAP said this is inaccurate and that "AHTC wrote in on June 10, 2011, to state that it wanted to develop its own system. Thereafter the contract was terminated with mutual agreement on Sept 9, 2011, after two extensions had been given... "

To help you understand the saga, The New Paper spoke to several experts to answer some questions. What is AIM's history?

The PAP Town Council Application Software was built for the PAP town councils by National Computer Systems (NCS).

It is unclear when the system was built, but in June 2010, the town councils sold the software to AIM for $140,000 through a tender process. AIM would also manage the system.

In an agreement which lasted till Oct 31 last year, the town councils then paid AIM $785 a month to lease the software. It is unclear how much the town councils are paying for the service now.

Is it unusual for the town councils to sell the system to AIM and then lease it back?

Those familiar with IT procurements said such arrangements are common in the private sector.

This works for companies that need software to meet specific needs, but do not have the resources or expertise to maintain it.

IT specialist Goh Kheng Wee of NexLabs, a company which specialises in customising software and IT solutions for businesses, said: "If a company were to hire a team of people just to built one system and work on it, the money spent for the salary of a team might not be justified.

"This is even more so if software development is not the company's core business.

"So many companies choose to do this (outsourcing) where it is more cost-effective."

Former MP Ho Geok Choo told The New Paper that Mr Lau Ping Sum, one of the directors of AIM, was an expert in IT when he was in OCBC Bank a number of years ago.

Said Madam Ho: "He's very methodical, systematic and process-driven. You need these qualities to handle such a mass-scale service.

"One does not need to be an IT expert to run a company or handle such jobs, but you need to be competent to do the job, and Chandra Das (also an AIM director) is a very good operations manager."

Why didn't the town councils work directly with NCS and operate their own system?

Mr Goh of NexLabs said that working with a company like AIM would take away the hassle of having to deal with things like bugs and crashes.

He said: "Again, it's so they don't have to deal with the nitty-gritty and the risk of supporting and updating software. All that work now goes to the middleman, which makes things easier for the first company."

In the case of the town council, the middleman is AIM.

If it is just a business deal, why is AIM in the news?

TNP understands that AIM is a small company with two part-time staff. But its three directors are former PAP MPs: Mr S. Chandra Das, Mr Chew Heng Ching and Mr Lau Ping Sum.

It started operating in 1991 with directors who were once MPs, according to a search on the Accounting and Corporate Regulatory Authority's website.

While Ms Sylvia Lim of WP targeted AIM for the red score she got, netizens focused on the people behind AIM and its relationship with the PAP-run town councils.

AIM became the new owner of the town council software in January last year, after it was one of the five parties that responded to an open tender advertised in The Straits Times on June 30, 2010.

Why have a clause that it would not work with a town council if it changes?

As a private entity, AIM has a right to choose who it wants to work with, said chief executive of financial consultancy firm Rafflesia Holdings Mano Sabnani.

"We shouldn't be presumptuous as to what their (AIM's) intentions are. As a private company, they have a right to say who they want to work with.

"There are other questions in this that are more pertinent, such as who exactly the owners are in AIM, are their deals done at arm's length, and are commercial rates being paid by the town councils," he said.

Does WP have experience with a billing system for conservancy?

Yes, and it has run Hougang for 21 years.

AHTC developed a town management system that has been in use for more than a decade.

AHTC wrote to AIM on June 10, 2011, to say that it was developing a new computer system. It thanked AIM for its service and asked for the termination to be done on Aug 31, 2011.

It then requested the extension of the use of AIM's software on two occasions, which AIM gave.

Is AIM making money out of the deal? How much?

AIM offered $140,000 to buy the software from the town councils and manage the system at a monthly fee of $785 for each town council, for an initial period ending on Oct 31 last year.

After getting the deal, AIM engaged NCS to maintain and further develop the system, and they signed an agreement with the PAP town councils.

Are any laws broken in this whole saga?

"I don't see any irregularity," said lawyer M. Lukshumayeh.

"There was a tender process. There were interested parties, but, for whatever reason, only one party submitted a bid.

"I don't see any irregularity about it. It's up to the organisation to accept the bid or reject it. In this case, it accepted it."

ACTION Information Management (AIM) was set up in 1991 to provide IT-related services.

Business records show that its three directors are Mr Lau Ping Sum Pearce, Mr S. Chandra Das and Mr Chew Heng Ching.

All three men are former People's Action Party (PAP) Members of Parliament.

Previously, former PAP MP Ng Pock Too and Mr John Wong Weng Foo, a prominent figure in the IT industry, were also directors.

On Monday, in a letter addressed to the media, chairman Chandra Das said AIM's directors "do not receive directors' fees or any other benefits".

The New Paper understands that the company has only two part-time staff.

AIM bought over the PAP Town Council Application Software through an open tender exercise in 2010.

The system was specially designed for the PAP town councils by National Computer Services (NCS).

The system helps manage the payment of conservancy fees, which in turn keeps town council account books in order.

It is unclear when the system was created.

AIM and NCS declined any comment.

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