Ministers urge WP to run forensic audit of managing agent

Singapore

THE Workers' Party (WP) must conduct a forensic audit on its town council's managing agent and take legal action if public funds have been misused, two ministers asserted on Friday.

National Development Minister Khaw Boon Wan said that "inflated fees" were paid to FM Solutions and Services (FMSS), the managing agent of the WP-run Aljunied-Hougang-Punggol East Town Council (AHPETC), in return for "gross incompetence" which has put the town council's entire financial health at risk.

He was speaking in Parliament on the second and final day of the debate on the Auditor-General's Office (AGO) report on the beleaguered town council - a report which uncovered "major lapses" in governance and compliance.

The excess fees paid to FMSS ran into an estimated S$1.6 million a year, sinking the town council's finances from a S$3.3 million surplus to a deficit of S$734,000 in three years.

Mr Khaw charged: "In short, FMSS and its owners, who de facto run the town council, have milked it. Residents' money and public funds have, in this manner, been abused."

FMSS, a company set up only days after the May 2011 general election, is majority-owned by the town council's secretary and its general manager, a husband-and-wife team.

The company was paid 20 per cent more than the previous agent that ran Aljunied under the People's Action Party, and 50 per cent more than a comparable town council.

In his speech, Mr Khaw expressed shock that, the FMSS, despite being highly paid, could not deliver a reliable system and administer the accounts and records at the town council.

"We must not allow FMSS to profiteer from their incompetence, all the more when it is at the expense of residents and public monies. Even if it isn't illegal, it is morally wrong," he said.

He went on to urge WP secretary-general Low Thia Khiang not to condone this behaviour and to hold FMSS accountable and take action against it for its "monumental incompetence".

Mr Low, a Member of Parliament (MP) for Aljunied, reiterated his point that it was difficult to find managing agents willing to bid for AHPETC's tenders; the other WP MPs who spoke on Friday also made the point that various contractors that have dealt with the town councils under the ruling People's Action Party (PAP) would not work with the opposition MPs.

Mr Low, visibly agitated by the incessant grilling by PAP MPs midway through the 31/2-hour debate, declared: "Nobody wants to work for a Workers' Party town council. That is the problem."

But Mr Khaw said Mr Low had a duty to "walk the talk" and show the party's sincerity through real action from now on. The WP has to recover the losses that it has allowed to take place and make restitution to the residents; Mr Khaw also reminded WP MPs to submit a "clean set of accounts" for Financial Year 2013 to Parliament by June 30, and for Financial Year 2014 by Aug 31.

"These are not high hurdles. These are the basic requirements for any organisation, for anyone seeking to run for office in any organisation. Every town council has been able to do this, including those run by opposition MPs in the past," he said.

Education Minister Heng Swee Keat, who also spoke, expressed concern over the well-being and interests of the residents living in Aljunied, Hougang and Punggol East.

"They've been shortchanged by their MPs and they've been kept in the dark. Elected MPs are expected to be clean, honest and act with integrity," he said.

He called on the WP to show its real colours. The party had to prove that it was true to its original word that it would be transparent, accountable and responsible when serving its constituents.

"It costs the WP nothing to promise the world, but there's a real cost to Singaporeans. Real lives are affected when promises are broken," he said.