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WP goes into electoral battle with town council woes in the backdrop

Party chairman Sylvia Lim confirms that the party has received a letter of demand from its ex-managing agent

The Workers' Party introduced this trio of candidates on Monday: (From left) research and consultancy firm CEO Leon Perera, medical social worker Frieda Chan and funeral services company executive Bernard Chen.


THE questions swirling around Aljunied-Hougang-Punggol East Town Council (AHPETC) and its fractured relationship with its former managing agent make for a heady brew, as the Workers' Party (WP) seeks another term from voters of the three wards and is to field candidates beyond as well.

Over the next nine days, WP will have to gauge how much its reputation has been hit by the AHPETC episode; it will also want to show that it can run more town councils. Whether voters will find this more pressing than the party's call for them to be empowered will emerge from the hustings.

The party has been called to explain AHPETC's relationship with its managing agent FM Solutions and Services (FMSS), and the town council has been taken to task for a litany of lapses that the court in May called the "height of financial irresponsibility".

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In the latest development, the party disclosed that AHPETC was indeed in a dispute with FMSS, following a New Paper report over a S$3.5 million payment claim by FMSS for work done over a three-month period this year; FMSS claimed this was for services delivered between April and July 14.

Last Saturday, the Ministry of National Development (MND) revealed the rich profit margins and directors' fees paid to those in FMSS.

FMSS' main shareholders were Danny Loh, who died in July, and his wife, How Weng Fan. FMSS was incorporated seven days after WP won the Aljunied ward. In addition to being the managing agent, Mr Loh and Ms How were respectively the secretary and general manager of the town council.

WP's chairman Sylvia Lim, who is standing for election in the Aljunied GRC "A team", confirmed on Monday that the town council had received FMSS' letter of demand. She would only say "substantial" payment had been made, and that the issue was under mediation.

"I don't think it's helpful for us to talk about the details of the numbers. For one thing, mediation is supposed to be a private process," she told reporters, adding she did not want to "jeopardise a reconciliation process".

Mediation will begin in October, and if the talks break down, they will head for arbitration, she said.

Most of these claims are related to projects. Ms Lim declined to cite examples of projects, saying only that the arrangement is typical across town council contracts. She said FMSS was, by default, appointed project manager, which allowed it to claim additional fees at a certain percentage of the project value.

This is separate from the managing agent's rates, which have also been in focus, with MND claiming that AHPETC had overcharged its constituencies. Ms Lim has said that FMSS, which emerged as the only bidder in an open tender, charged rates that followed "strict reasoning", using available market information in 2012.

She said on Monday that the project claims are sinking fund expenditures, most of which are for fiscal 2016. It should not affect the surplus or deficit position of the operating accounts, Ms Lim said.

Up to 70 per cent of a town council's funds are found in its operating fund, which pays for routine expenses such as estate cleaning. The rest in the sinking fund is meant to pay for major repairs and maintenance.

MND withheld S$14 million in grants from AHPETC for FY2014 and FY2015, as the town council wanted all of that money to be transferred into its sinking fund - a request that was against the rules - but did not answer questions on cashflow, said finance minister Tharman Shanmugaratnam in Parliament last month.

MND has appealed against the court's decision in turning down the government's application to appoint independent accountants to AHPETC. It wants them to be appointed before it disburses the grants.

AHPETC said in its annual report that if the MND operating grant is included, it would turn in a surplus of S$1.65 million for FY14/15. The audited accounts included a disclaimer of opinion, due in part to certain conservancy and service receivables that the auditor could not account for.

Asked on whether WP has lost moral authority to demand transparency from the government, Ms Lim said the town council is bound to the contractual agreement with FMSS, and that "it is just a letter of demand". "People can demand things, but whether they are legitimate or not, and to what extent, that's another question altogether."

All of this comes as WP has called for greater support for the opposition, as this has brought about a more responsive government. The party's secretary-general Low Thia Khiang said last week: "The important question that the voter will have to think about is, first of all, whether it continues to be a good model for Singapore - where the political leaders cast a long shadow over every aspect of life, every aspect of society, organisation, profession."

Mr Low said he personally believed that having 20 Members of Parliament from one opposition party would be healthy in setting up checks against policies. "Let's keep the government on its toes, for the benefit of Singapore," he said.

WP would not say whether it has a "B team" to take on another GRC. Its final election slate will be revealed only on Nomination Day.

Meanwhile, its crop of new candidates have mostly toed the party line in repeating a pledge to be a "rational and reasonable" opposition party.

Many of them are recent members of the party and are trained in law; at least one - He Ting Ru - has showed admiration for Chen Show Mao, who, after attracting much fanfare in the 2011 election, has been quiet in the public sphere.

WP has also attracted candidates with impressive education records, including the two Oxford graduates introduced on Monday.

Leon Perera, a WP potential candidate and chief executive of a consultancy, said: "We should not see ourselves just as passive consumers of the state services." He graduated from Oxford University with a double first-class honours degree in philosophy, politics and economics.

He was introduced alongside Bernard Chen, another Oxford graduate, who is the party's youngest candidate at 29 and who has served WP the longest among the new faces.

The third potential candidate introduced was Frieda Chan, who contested in Moulmein-Kallang GRC in 2011.

WP is expected to raise questions on immigration. It said in its manifesto that it would keep the foreign population constant at between 1.5 million and 1.6 million if Singapore achieves a one per cent resident workforce growth target.