09 May 2013

The Ministry of National Development comprehensive clown show

We examine the Ministry of National Development's oft-delayed, long-awaited review of the transaction between the People's Action Party's 14 town councils and Action Information Management, published on 3 May 2013 (PDF link), in light of the parliament sitting on 13 May 2013.

Whatever happens on Monday—a dramatic showdown headed by a bold opposition, a comedy of missed chances authored by an underperforming opposition, or a grotesque self-interested bipartisan agreement to sweep all embarrassing issues under the carpetthe ruling party and the establishment press will declare the sitting a fitting closure to a contentious debate, and call for the citizenry to lay aside their misgivings, move on, and to reinvest their blind trust in a to-be-reformed town council system.

We present this post so our readers can see for themselves on Monday whether Monday's debate is the real thing, a clown show, or pure political kabuki.

Will Monday's parliament session be a farcical pie fight?
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The issues as we see it

The public disquiet in the streets, online, and in social media over the AIM affair stems from several concerns:

1. Conflict of interest of the political variety. In the tender process, PAP-appointed party member Ho Pin Teo basically gave the contract to a company only he and other senior party members knew was "owned" by the party and managed by fellow party members. This was special knowledge of a relationship that could not have been found in any public record.

2. Questions of procedural irregularities and non-transparency
a. conflict of interest not reported in town council's annual report on the AIM contract deal(s) amounts to a breach of due diligence.
b. Teo's reason for awarding the contract - that he knew the special status of AIM - was not reported in the town council annual report. This may be perfectly legal within the bounds of the town council regulations, but amounts to another breach of due diligence.
c. non-transparent tender for a contract of no viable commercial value, which basically is one of the criteria for determining procurement corruption (whether legal or illegal).

3. Political trust, legitimacy of the PAP.

How did the PAP come to own a private business and not have the business declare its true ownership or even declare its ownership? Is this legal?

Even if legal, is this a circumvention of laws on political donations in Singapore, and completely at odds with international legal norms on political financing?

Can the people place their trust in the PAP if it owns a clandestine business empire and is legally entitled to own a clandestine business empire?

How can a political party manage become so secretive when the laws regulating political parties (i.e. the Political Donation Act, Societies Act) are written to ensure they operate with transparency and scrutiny?

Note that the majority of these three sets of concerns are ethical and procedural, not legal.

The issues as MND saw it

1. MND reviewed the external audits of the PAP town councils but not AIM's audit reports. It accepts the town councils' assertion that AIM made no profit, that whatever was paid to it was to cover its operating costs... It should have just reviewed the annual audits of AIM instead.

2. MND clears the town councils of any illegality. The public outcry was about ethics, transparency, politicisation of town councils, and conflict of interest.

3. MND clears the town councils and Ho Pin Teo of any conflict of interest only because MND accepts that town councils will have political conflicts of interests, that party MPs will engage party-affiliated companies to manage their town councilsand then pretends these aren't really conflicts of interests that matter.

Strangely enough, MND exonerates AIM. Reason? The company actually developed the TCMS in 1996, so it had a track record prior to the tender in 2010. MND however doesn't ask why AIM was even given the 1996 contract, as a $2 company with STILL zero staff in 1996.

MND, investigating with blinkers on

By refusing to acknowledge the real reasons for the loss of public trust in the system, the MND's review is unlikely to restore this trust.

It is clear that MND's investigation falls far short of popular expectations, even far short of Minilee's directive for a comprehensive review. It has stuck to a purely legalistic review, only of the town councils - leaving AIM and its political affiliations out of the picture. By not questioning AIM and its political affiliations, it obviously does not find any procedural irregularities with a senior PAP member awarding contracts to a company whose PAP affiliations were not public knowledge.

It has not found any conflict of interests because it already accepts as a matter of principle, that political conflicts of interests will arise and are encouraged by the current town council system.

We at Illusio believe that MND's blinkered report fully justifies our stand that it was the wrong agency to investigate the town councils. We call upon the Auditor-General of Singapore and the Registrar of Societies to launch an independent investigation to audit the PAP Town Councils, AIM, and the People's Action Party, to ensure full transparency, to identify weaknesses in the legislation and regulation of town councils and political financing, and to suggest measures that will restore Singaporeans' trust in the political and town council system.

1 comment:

Anonymous said...

You mention that it is oft-delayed. What would have been a suitable date for it to be "not delayed" or "expedient"?