by Sylvia Lim, MP for Aljunied GRC and Chairman of Aljunied-Hougang-Punggol East Town Council
[Delivered in Parliament on 13 May 2013]

This debate has been triggered by the controversy surrounding the sale of town council management software (TCMS) by 14 Town Councils managed by the People’s Action Party (PAP) to Action Information Management Pte Ltd (AIM) in 2011 prior to the General Elections.

I would like to thank the Prime Minister for acknowledging the public interest in this matter and for ordering the Ministry of National Development (MND) to investigate and to do a broader based review of the nature of Town Councils (TCs). I would also like to record thanks to the Ministry officials for their efforts.

Where do we stand today, after the review? MND’s findings cleared the AIM transaction but highlighted areas for strategic review of TCs. It seems, however, that members of the public who have been tracking this issue are still asking critical questions, and many are not convinced that the 14 PAP TCs acted in the public interest when they sold the TCMS to AIM.

It is necessary to debate this matter calmly and clearly, to enable the public to understand the issues more fully and realize what is at stake. That was why I re-filed an adjournment motion last week. The government’s subsequent decision to enable the matter to be debated under Standing Order 44 is belated, but it is the correct thing to do.

WP’s and AHPETC’s Basic Position on MND’s findings

Let me first summarise how the Workers’ Party and Aljunied-Hougang-Punggol East Town Council (AHPETC) view the MND findings before elaborating. I shall thereafter make recommendations for the review.

First, we do not agree with the findings regarding the AIM transaction that public funds were safeguarded and residents’ interests had not been compromised.

From our reading of the documents available to us, there were aspects of tender suggesting it failed to follow the spirit of what an open tender should be. Further, the terms of the sale of the most critical town management IT system had unnecessarily endangered public welfare, particularly the relinquishing of ownership to AIM with the one-month termination clause. MND fell short in not admonishing the PAP TCs for risking disruption to the public in the name of politics. MND also did not take cognizance of the wastage of public funds incurred when such terminations required replacement systems to be set up. In addition, the one-year sale and leaseback was clearly an underestimate of the time needed to re-develop a new TCMS; the fact that the one year happened to straddle GE 2011 suggests that whatever “good faith” the TCs had in the sale to AIM, there were political objectives in crippling any new TC leadership of a different political affiliation, hence endangering the public in the process.

Second, as regards the MND’s recommendations for a review of TCs, we find that while they will improve continuity of services during a handover of TC management, the recommendations do not go far enough to prevent wastages of public funds. MND should entrench principles to recognize the public nature of assets being handled by TCs which should be safeguarded for public benefit, regardless of party politics.

Genesis: Why TC issues were raised by WP and AHTC in December 2012

Before I go further, I should at the onset state WP’s position concerning town management and why we brought the AIM sale to public knowledge in December last year.

WP MPs are committed to being politically accountable to voters for town management under the current regime. Whatever else is done in other countries, the responsibility for town management has been legislated to the MPs under the Town Councils Act. We accept this responsibility and have pledged during elections to manage towns entrusted to us to the best of our ability. We intend to continue keeping this promise.

We raised the sale to AIM after the MND released its banding of town councils under the revised TC Management Review framework in Dec 2012. Contrary to what some PAP members have charged, it was not raised as an excuse for non-performance, nor are we asking anybody to wait 24 or 30 months or 5 years for us to perform. AHTC was actually ranked well and comparably by MND in the areas of cleanliness, maintenance and lift breakdowns – the critical functions residents care most about. The main point which required public explanation was that the new indicator of “Corporate Governance” was graded as “pending”, as our auditors took much longer to complete their work. This was due to the need to reconcile accounts being kept under two different IT systems with differing nomenclature.

We do not believe that the AIM sale served the public interest, and the public deserved to know about this and assess it for themselves. We find it unacceptable for any TC to relinquish control over critical TC assets developed with public funds to third parties, who can cut the TC off from using the assets to service residents. In our view, the PAP TCs had unjustifiably risked a disruption to public services and that this should not be allowed to recur. I am relieved to read that the MND recognized the need to preserve continuity of public services as a paramount priority. The question is: why did the PAP TCs not recognize the risk of service disruption when selling the TCMS to AIM?

AIM Transaction

Let me now go into some detail about our misgivings concerning the AIM transaction.

Reasons for the sale

The reasons given by the PAP TCs for the sale of software and the intellectual property (IP) raise more questions than answers.

They told MND (MND report paras 17 to 19) that having the software rights reside in a single entity was better than having the vendor deal with 14 TCs which would be “cumbersome and inefficient”. But surely this can be easily overcome, since the PAP TCs have a Co-ordinating Chairman who can co-ordinate to ensure the proper authorisations? The TCMS was developed with $23.8 million of TC operating funds (MND report para 13); surely there is reason to retain ownership and control over it for the residents in the 82 electoral wards then under their charge? Much ado is being made in the report that the second generation (2G) TCMS was “almost obsolete and had limited value” (MND report para 19), but does this mean it is of limited value to the TCs using it now? If the system ceased to function without replacement, TC operations would grind to a halt! Another incomprehensible justification is the saving of $8,000 for the 14 TCs that arose from the sale (MND report para 26(a)). The $8,000 saving is the difference between the $140,000 paid by AIM and the sums paid by the TCs back to AIM during the one year leaseback. This total “saving” of $8,000 shared among 14 TCs amounts to about $571 per TC. Is saving $571 significant enough reason for a TC to sell a system?

Tender Terms

It was emphasized in the MND report that the choice of AIM was made after an open tender (MND report para 20, 21). Was it an open tender in substance?

The tender was advertised and 5 companies picked up the documents. However, a closer look at the Conditions of Contract will reveal that the specifications required each of the directors of the tendering company to have “adequate experience with the operations and functions of a Town Council”. I wonder how many companies in the software business in Singapore can say that all their directors have TC experience – perhaps only AIM?

The tender period was advertised as 14 days (MND report para 20), shorter than the minimum period of 3 weeks for local tenders required under the TC Financial Rule 74(6). It was then extended by another week to give 3 weeks. Why the initial period advertised was one week less than the minimum was not explained at all in the MND report.

In addition, one of the companies which picked up the tender forms had told the media that there was insufficient information in the tender documents to make a decision whether to tender (The New Paper, 5 Jan 2013, page 6).

Risk assessment of AIM

The PAP TCs told MND that one of the key reasons for selling the software to AIM was that AIM agreed to bear the risk of any price increases by NCS in maintaining the software, even after the original contract with NCS expired (MND report para 25(b)). We have not been able to find this exact clause in our documents. However, even assuming so, on what objective basis did the PAP TCs assess that it was safe to entrust this risk of cost increases to a company with a paid-up capital of $2? Who will pay in the event of a cost increase? What about the risk of AIM being wound up?

The PAP TCs highlighted AIM’s “track record”, but based on the tender documents we have seen, AIM listed only one prior project, also a sale and leaseback. When AIM was asked to fill in a table indicating the identities of their key technical and professional staff, a line was drawn across the table with only one word typed in: “Outsourced”.

Duration and timing of sale and leaseback

MND noted (para 5) that the TCs “underestimated the complexity of the task of developing the new generation TCMS software”. We find this quite puzzling, since the TCs had experience in developing the 1st and 2nd generation TCMS and should have known that one year was too short. Now, as MND has noted, 2 extensions were required after that (para 5), and a fresh tender was only called this year in 2013. Was there any re-development work from 2011 to now?

The timing of the sale to commence a few months before the General Elections in 2011 also calls for explanation. Was it a pure coincidence? Or was there simply a need to sell the software quickly, so that termination can be effected if political seats were lost? Let me now turn to the termination clause.

Termination clause

The reasons given by the PAP TCs for the one-month termination clause (MND report, para 3(e)) are plainly unconvincing.

First, no attempt was made to explain why a material change in membership of TC should allow unilateral termination by the contractor with one month’s notice. It is unfortunate that MND did not seem to query this, as this is the crux of the exchange between the PAP and WP. Could it be that there is simply no good reason to give?

Some attempt was made to explain why termination may be fair in the case of a change in boundaries: it was said that the contractor might be faced with a much larger town than anticipated, but be held to a fixed price to his detriment (MND report para 3(e)). I am not sure why there was this worry. At that time, the TCMS was being developed for the whole of Singapore except 2 SMCs viz. Potong Pasir and Hougang. In addition, the contract itself already provided for a variation in price based on the number of property units!

The real sting of the termination clause lay in its one-month notice period. Is a one-month termination reasonable for a critical IT system? It is quite clear that time is needed to develop a system of this complexity – in the PAP’s own estimation, 18 to 24 months. Did the PAP TCs not realize that this aspect of the AIM transaction endangered the continuity of public services? Or perhaps that was the intention in the case of a change in political leadership?

It was fortunate indeed that the WP could use the IT system in place in Hougang TC and upscale it within a much-abridged time to cater for a town of GRC magnitude. What if a constituency was won by a political party not running any TC, or by an independent candidate? Or is the continuity of public services not important to the PAP once they lose a constituency?

Wastage of Public Funds

No finding has been made about the wastage of public funds caused by the need to replace IT systems due to a change in political leadership. Once a system has been developed with TC funds, the residents have a beneficial interest in it, since they contribute to TC funds via Service and Conservancy Charges. Why should they pay again, for a replacement system, just because the town council management has changed hands? Even those who live in private estates have asked me about the wastage, since TCs are also funded by government grants that they, as taxpayers, contribute to. MND has made a finding that there was no loss of public funds caused by the AIM transaction, but what about the wastage of public funds which the transaction brings about? Residents and taxpayers pay twice for political intrigue – how is that justifiable?

Nature of TCs and AHPETC

Let me now move to the nature of Town Councils and the recommendations for strategic review.

Town Councils provide essential public services to HDB dwellers via public funding. As custodians of public funds, all MPs must act in the best interests of residents, regardless of which political party they support. At the same time, TCs unavoidably have some political elements. The manner and quality of town management is one factor in a voter’s choice of MP, and MPs wish to do well in town management in order to get re-elected. However, it does not mean that MPs can allow TC assets to be endangered or cut off from TC use for political reasons.

Let me at this juncture share some essential facts about AHPETC and correct some misconceptions.

The IT system in use in AHPETC belongs to the TC and will be there for use even if there were to be a change in political leadership. There are no equivalent termination clauses unlike the AIM transaction. In fact, I understand that Potong Pasir TC is still using the IT system developed before the change in political leadership in 2011.

I also take strong issue with a misleading release by MND on our Managing Agent, FM Solutions and Services Pte Ltd. The Straits Times of 7 May 2013 reported that “MND gave examples of how politics and town councils sometimes mix” which included, in our case, the former General Manager of Hougang TC and her husband setting up a company to provide town management services to AHTC. We find this insinuation mischievous, as neither she, nor her husband, nor any of the directors and shareholders of the company, are WP members. They were hired based on their experience in property management, professional skills and track record in running Hougang TC. What is MND implying? The Minister should explain.

Recommendations for TC review

I now come to the final part of my speech – our key recommendations for the review of Town Councils.

First, restrictions should be in place in the TC Act to prohibit the sale of critical assets / systems still needed for TC’s operations to third parties. On no account should TCs relinquish control over the use of the assets, which should survive any change in political leadership. The most critical system would be the IT system for town management. Ownership of the town management software system and its intellectual property rights should reside with the Town Council.

Second, town management systems which serve several constituencies should be configured to be easily segregable at low cost in event of boundary change or leadership change. This should be ensured for the 3G TCMS.

Third, another important IT system which should be safeguarded for continuity is the telemonitoring system (TMS), which monitors lift breakdowns and lift rescue. All TCs are currently using the TMS from the same provider, and at the minimum, the existing termination period of 3 months is too short and should be reviewed.

Fourth, important service contracts such as those for Managing Agent and Essential Maintenance and Services Unit (commonly called EMSU) should provide for a longer termination period to allow for a fresh tender to be called, if necessary, after a handover.

Finally, unilateral terminations by contractors of essential contracts due to a change in political leadership should be disallowed. Should there be a need to put in place another contractor due to business considerations, a mutual discharge can be agreed between the TC and the contractor.

We are ready to provide further input if needed.

Conclusion

We believe that the sale of the TCMS by the PAP TCs, whatever its other ancillary benefits, was to enable AIM to cut off any non-PAP TC from using the TCMS at short notice, crippling the TC. By doing so, they acted in their party political interest and jeopardised the public interest, using a critical asset developed with public funds.

In this light, I cannot help but recall the Parliamentary debate in 1988 when the Town Council Bill was first presented for the Second Reading. At that debate, the then First Deputy Prime Minister Goh Chok Tong justified the introduction of Town Councils as providing political stabilisers to the political system. He said there was a need to protect the public by ensuring that political parties which aspired to be government should first prove that they could run a Town Council for a constituency. He said: “If a new party finds itself unexpectedly in government, it would be like an aspiring pilot taking over an SIA jumbo jet in mid-air before he has flown solo in a Cessna. This cannot be in the interest of passengers in the jumbo… TCs are the Cessnas of our political system”. He also highlighted that some PAP MPs had expressed a fear that opposition MPs could win “some seats, prove themselves” (able to run the Town Councils) and thereafter “fan out to other constituencies in subsequent elections” (Hansard, 28 June 1988).

Is this what this whole AIM episode is about – ensuring that the passengers in the Cessnas have bumpy rides or even crash land? Does the government even care about the passengers in the Cessnas, or are they simply collateral damage in a bigger political game?

By MP for Hougang SMC, Png Eng Huat
[Delivered in Parliament on 13 May 2013]

The MND Town Council Review has left many questions unanswered despite providing a lot of background information on the AIM transaction. While the report has concluded that the sale of the Town Council Management System (TCMS) to a PAP-owned company was nothing more than a business deal, the intentions behind the AIM transaction were not thoroughly scrutinized and explained.

The MND Review also did not look into the possibility that some of the decisions made in the AIM transaction could be politically motivated since MND has acknowledged that Town Councils, by virtue of their leadership, are politicized already.

While the AIM transaction is deemed legal and permissible under the law, the rationale behind the sale of the Intellectual Property (IP) rights to the TCMS to a PAP-owned company and the provision of the Termination Clause in the contract remains unclear and unconvincing in the review. Today I wish to speak on these 2 issues.

Termination Clause
The MND review has not fully addressed how public interest is being served when a vital piece of software for town management, developed at a combined cost of $23.8 million (page 15), was offloaded to a PAP-owned company for $140,000 with an unusual Termination Clause made in favour of the new owner.

The Termination Clause reads:
“The Contractor may in its absolute discretion terminate his services during the contract by giving three (3) months prior notice in writing to the Town Council. However, in the event that there are material changes to the membership of the Town Council or there are material changes to the scope and duties of the Town Council, including but not limited to changes to its present boundaries the Contractor may give a month’s notice in writing, if he wishes to terminate the services during the contract period.”

I find it hard to comprehend that after selling the TCMS to a vendor, the PAP Town Councils also found it imperative to give the same vendor absolute discretion to terminate its services which are vital to the operations of their own towns. How are the interests of the residents protected in such an arrangement?

And what are ‘material changes’ and why it is so important that if such changes were to happen, AIM could just give a month’s notice to terminate its services to any town council.

In the official explanation of the Termination Clause, the PAP Town Council has failed to fully address the meaning of ‘material changes.’ Nonetheless, the PAP Town Councils felt that the provision of such a one-sided Termination clause was ‘fair and reasonable as the vendor would have priced its bid on the basis of the existing TC and Town boundaries. However, should this change materially, the vendor could end up providing services to a TC comprising a much larger area and a larger population of residents, but is held to do so at the same fixed price since a key feature of the contract was that there should be no price change to the TCs even for extensions. The TCs felt that this would be unfair to the prospective vendors, and a clause explicitly addressing such changes would reduce the business risk to the vendor. This would help fetch a better tender price for the TCs’ old software.’

While the above explanation may sound logical, I will explain to this House, point by point, why the provision of the Termination Clause is ill-conceived and makes absolutely no sense at all.

First, there will always be changes made to the size and population of a town because of Build-to-Order (BTO) flats, Selective En bloc Redevelopment (SER) Scheme, private developments and the constant redrawing of our electoral boundaries. Is it then prudent to allow AIM or any new owner of the TCMS to simply walk away from this critical contract citing ‘material changes’ and leaving an entire town in a lurch? How is public interest protected with such a one-sided Termination Clause?

Second, in its original contract, AIM proposed a Lease-Back payment schedule that did not take into consideration the size and population of a town council. All the 14 PAP Town Councils, regardless of their size and population, were required to pay an equal amount of $785 per TC per month as lease-back payment for the use of the TCMS. Thus, it does not matter if you are running a small GRC like Moulmein-Kallang or a big GRC like Ang Mo Kio, each town council pays AIM the same amount of subscription fee. So was AIM concerned about the size and population of a town when pricing the TCMS subscription fee? The answer is obvious. And if AIM is not even worried about such business risk, why would the 14 PAP Town Councils lose sleep over this and want AIM to address such risk? After all, the PAP Town Councils had assessed that AIM is ‘a company with an established track record in TCs and IT services’ and they had confidence the company would deliver on its commitments.

Third, the above explanation of the Termination Clause sounds even more ludicrous when one finds out that there is a clause in the same contract that allows for variation and AIM would be paid in accordance to a method of calculation based on industry practice. In short, AIM is covered if ‘material changes’ in size and population of a town council were to happen for whatever reason. So why was there a need to give AIM the absolute discretion to cite ‘material changes’ to terminate its services to a town council when ‘material changes’ were already covered under the Variation Clause? Can the Minister explain this anomaly?

The provision of this one-sided Termination Clause in the AIM transaction makes no sense because the interests of the residents were not protected at all. Our towns are always in a constant flux of change due to the dynamics of our public and private housing schemes and the redrawing of our electoral boundaries. Residents should not be made to suffer unnecessarily as a result of such ‘material changes’.

The one-sided Termination Clause has caused so much confusion that even the Minister is confused as he has said earlier that the letter of 10 June 2011 sent by the Interim Secretary of the Aljunied-Hougang Town Council was a request to terminate the use of the TCMS. On the contrary, the letter was a request to continue the use of the software of the software till 31 Aug 2011. The Aljunied-Hougang Town Council has no power to initiate any termination based on ‘material changes’. AIM was the one which was given the power to terminate and did exercise it 12 days later on 22 June 2011 according to its own timeline. The question is why PAP Town Councils allowed town councils to be powerless and at the mercy of AIM?

Sale of Intellectual Property Rights
The review report has also concluded that the AIM transaction complied with the Town Council Act and Financial Rules. However, there is a misplaced trust that the sale of the IP of the software to a PAP-owned company was done in the best interests of the residents.

Would any member in this House want to spend $23.8m of your residents’ money to develop a vital piece of software and then offload the IP to a third party knowing very well that future developments and upgrades of the system may depend on the use of the original IP rights?

The risks of system obsolescence are common problems faced by people or companies who depend a lot on the use of IT in their operations. Thus everything from software to hardware can be rendered obsolete in a short space of time but the IP will not. The knowledge system that went into developing the IP for the $23.8 million TCMS is valuable and critical. The TCMS may have zero book value but its real operational value is immeasurable. Right at this moment as we debate in this parliament, the TCMS is keeping almost the entire Singapore humming along, processing payments, managing arrears, handling residents’ feedback and facilities bookings, keeping the financial in check, keeping the communications flowing, and more. The rights to the use of the TCMS must remain open to a town council no matter what or when ‘material changes’ take place.

In the interest of the public, can the Minister state who will own the IP rights to the $17.6 million 3rd generation TCMS that is currently being developed by NEC Asia Pacific? Will AIM be holding any IP rights, direct or derivative, to the new system that is being developed and funded with town council money?

The official explanation of the sale of the TCMS to AIM was to consolidate the IP rights under a single entity for ease of management, future development, and securing extensions of the NCS contract at no extra cost to the PAP Town Councils until such time when the current system is replaced.

As AIM outsourced its IT services to other vendors, it is basically playing the role of a project manager and project managers do not need to own the IP rights to the project they managed especially when those projects are vital to the operation of our towns and developed with public money.

It also appears incredulous that the 14 PAP Town Councils would need an external company, who is technically a competitor of NCS, to help them negotiate and secure extensions of the NCS contract at no extra cost to the PAP Town Councils even though the town councils have a longstanding working relationship with NCS going back to 2003 when they first awarded the multi-million project to the IT company.

How hard it is for the PAP Town Councils to secure extensions of the NCS contract at no extra cost on goodwill? Did the PAP Town Councils try to approach NCS directly?

Conclusion
The relationship between the PAP Town Councils and AIM is an uneasy one. It was reported that AIM was set up by the PAP in 1991 to specifically support PAP MPs in the running of their TCs and estates. The company does not seek to make profit from its work done for the PAP Town Councils and only charges management fee based on cost-recovery. Thus, any transaction done between the PAP Town Councils and AIM has very little business consideration, mostly political I presumed.

The MND Review has stated that ‘given the political character of the town council’s leadership and the political implications attached to the management of the town council, it is inevitable that the town council function is carried out in a competitive politicised context.’

The AIM transaction had all the trappings of a high stake political game where the interests of the residents are of the least concern. So how should MND classify the sale of the TCMS to AIM and the provision of the one-sided Termination Clause in this review, business or political?

Finally, I believe whatever that was written in black and white in the AIM transaction has been reviewed by the committee but whatever intention that was written in the hearts of the people that were involved in this transaction will remain hidden for their conscience and makers to judge.

By MP for Aljunied GRC, Pritam Singh
[Delivered in Parliament on 13 May 2013]

The Town Councils Act of 1989 was passed with reference to Singapore politics of the 1980s, when non-People’s Action Party (PAP) Members of Parliament (MPs) were elected to check the government, ending the one-party rule of the PAP in parliament. Whatever the stated intent and objectives of the Act, government entities could make life difficult for elected non-PAP MPs from carrying out their duties; For example, by refusing to allow the non-PAP MP to use the existing Town Council (TC) office after securing the people’s mandate at the polls because governing legislation like the Town Councils Act provide no safeguards against direct or indirect actions by a PAP government that is intent on obstructing non-PAP TCs.

The Ministry of National Development’s (MND) findings have cleared Action Information Management Pte Ltd (AIM), a fully owned PAP company from any wrongdoing. But, in the minds of many Singaporeans, while the MND Report found nothing legally out of place with the AIM transaction, legal legitimacy under the Town Councils Act does not necessarily represent a commitment to good governance and the continuity of public services in the aftermath of general elections.

During the reading of the TC Bill, then DPM Goh Chok Tong explained the politicisation of the TCs as giving MPs increased authority and responsibility as a result of which, voters would be more likely to vote “carefully and sincerely” and choose honest and effective MPs. However, the years that followed saw other means used by the government to lower the standing of a duly elected MP, even if that individual was able to run a TC competently. Denial of upgrading projects such as the then Main Upgrading Programme and the Interim Upgrading Programme – was a ruthless psychological PAP tactic at the polls that pandered to the selfishness of the individual, at the expense of other higher order human instincts such as fair play and equality.

For all practical purposes, the PAP government of the day could jeopardise a candidate’s prospects at the ballot box and punish residents without even having to worry about the legal consequences of doing so, as there were none, forget about any protection under the Town Councils Act. So in spite of the original intent of the Act, even if an MP was honest and effective, the government of the day retained significant powers to cripple him, as it did in Hougang and Potong Pasir. Beyond the determination of the respective MPs in these wards, the thing that held the MPs in esteem was the wisdom, sense of justice and personal sacrifice of the majority of their voters.

It is through these historical lenses that many Singaporeans understood the AIM imbroglio that unfolded at the end of 2012 and the beginning of 2013, after coming to terms with the revelation that the PAP incorporated and owned a private company in 1991 that was operating in the public sector.

While the MND Report saw a “fundamental tension” between the objectives of delivering good public service and the political accountability of MPs – in the specific case of AIM unfortunately, it fell short in exploring the source of this tension. Quite simply, the source of the tension was the political profile of AIM.

The right of a fully-owned PAP company to terminate a critical piece of the then Aljunied-Hougang Town Council’s (AHTC) infrastructure with one month’s notice was not in the public interest precisely because even by the PAP’s own admission, it would have taken up to two years or even longer to establish a new Town Council Management System (TCMS). The presence of this clause, in the political context of the Town Councils, ought to have raised a conflict of interest red flag because a PAP-owned company and the PAP TCs had defined their rights and obligations by virtue of a contract that ran the real risk of undermining and prejudicing an incoming non-PAP run TC.

Many Singaporeans wonder what would happen to a TC in the absence of a working and functional TCMS. Beyond managing maintenance records, feedback management amongst other critical day-to-day operational functions, the TC would not be able to efficiently manage the collection of S&CC fees from residents. Collection would have been a cumbersome exercise, part-manual, part-electronic, and the TC would have been overwhelmed by S&CC collection, leaving little time for other tasks. Until a new TCMS was established, there would have been numerous disputes pertaining to the accurate collection of S&CC fees and potentially, a whole list of unfulfilled contractual obligations with the TC’s contractors. While the standing of the elected MP would be compromised, the real losers would be the residents who would be faced with delays with rubbish collection, dysfunctional amenities, and a very unpleasant state of affairs immediately outside their own homes, all unconnected to the competence of the incumbent MPs. The prospects of this reality would explain why the AHTC team worked in the months after May 2011 to stabilise TC operations and upscale the former Hougang Town Council’s IT management system, instead of allowing the residents of Aljunied GRC to be potentially held at ransom by a one-month termination clause in the hands of fully-owned PAP company.

The MND report justified its finding of the absence of any conflict of interest in terms of TC members having a pecuniary or direct interest in the AIM transaction, whether the interests of the TC’s residents were protected or impaired and whether there was any misuse of public funds. However, beyond our contention that the AIM transaction was not in the public interest, if one reflects on the historical context in the aftermath of the passing of the Town Councils Act, a fully-owned PAP company’s right to terminate the TCMS was in keeping with the philosophy that has defined the relationship of the PAP government with opposition-run TCs since 1988, and therein lies the inherent conflict of interest surrounding AIM – a conflict of interest that has been duly recognised by discerning Singaporeans.

In the more recent past, the PAP has moved away from denying upgrading to opposition wards, but the political calculations behind this move do not mean that a u-turn can never take place. The historical record shows that the public interest in the non-PAP TC context is usually a victim of PAP pressure on voters during parliamentary elections. There is significant opinion outside this House that this is an ethically unacceptable state of affairs.

It is for this reason that the remarks of the Permanent Secretary of the MND in his letter of 30 April 2013 to the Prime Minister, which called for a strategic and comprehensive review of TCs, ought to be welcomed. Of particular significance is MND Report’s recognition of public calls to depoliticise Town Councils, a point that was somewhat reinforced by a Straits Times poll of 7 May 2013 where 41/50 residents called for the same, the main concern for some being the lack of a political level-playing field and its impact on residents.

The question of depoliticisation is significant because it raises not just the issue of a review of the Town Councils Act, but the substantive relationship of the government towards wards which are not run by PAP TCs. For the specific purposes of this debate, depoliticisation must mean that companies owned by political parties should not tender for TC contracts – a glaring omission from the MND report. In addition to the recommendations called for by Ms Sylvia Lim, the report’s call for depoliticisation – if executed as imagined by most Singaporeans – would effectively entail inducting a new brand of politics into Singapore insofar as government-TC relations is concerned, representing a hope and desire that goes far beyond the findings of the MND report, but one that is in line with public expectations.

Some members of the public have suggested that certain TC functions like the provision of the TCMS can be the purview of agencies like HDB and that governance would improve with MND’s oversight. However, putting critical infrastructure in MND hands would be self-defeating if agencies like HDB are open to political influence in matters concerning local TC administration. If such agencies are open to political influence, they would effectively be operating like a quasi-Managing Agent, as evidenced by the HDB’s decision to lease 26 common properties under the then Aljunied Town Council to the People’s Association in the aftermath of the 2011 General Elections, to the exclusion of the incoming TC and newly elected MPs. In the AIM context, the larger point is that critical assets like the TC’s IT system and its intellectual property must remain part of the TC and cannot be terminated unilaterally. Non-PAP TCs must be allowed to effectively manage the town without political interference by HDB or MND, or have its functions compromised by policies that serve a political purpose to the advantage of the ruling party.

Madam Speaker, the findings of the MND report provides a rare opportunity for the government to look into substantively depoliticising not just TCs, but the relationship between TCs and the government. The MND report at paragraph 59 states that there were some who opined that depoliticising TCs can improve their governance and that MND can “regulate and oversee TCs without perception issues.” Unfortunately, as I have explained earlier, the historical track record of the PAP is not promising in this regard. Depoliticising TCs will not mean anything if political calculations continue to determine how MND or other agencies deal with non-PAP TCs. It will not guarantee a level playing field as sought by Singaporeans, nor will it be reflective of the ‘new normal’ we operate in today where an expectation of transparency, accountability and equality ought to represent the guiding principles of a good governance. I look forward to the tabling of the TC amendment bill where these matters will inevitably be debated in greater detail. For the immediate term, it would only be appropriate, in light of the findings of the MND Report for the Minister to direct that companies fully-owned by political parties ought to have no business dealing with TCs.

Thank you.

By Non-Constituency MP Gerald Giam
[Delivered in Parliament on 8 April 2013]

Madam Speaker,

This Bill seeks to amend the existing Child Development Co-Savings Act to implement some of the measures in the Marriage and Parenthood Package that were announced earlier this year.

I welcome the amendments and I am glad to see the introduction of paternity leave. This was something I appealed for during last year’s Committee of Supply (COS) debate. I urge all new fathers to fully utilise the one week of paternity leave to bond with their newborn babies and help their wives during their confinement period. I’m glad I was able to take paternity leave when my two babies were born a few years ago and I’m grateful to my company for providing it even before the Government mandated it.

I think the Government is moving in the right direction by extending paid childcare leave to all single mothers. However, the Baby Bonus and equal maternity leave, which are two of the biggest and most helpful parenthood benefits, are still being denied to single unwed mothers. My colleague, Ms Lee Li Lian, advocated on behalf of single mothers and for the equalisation of maternity leave during the COS debate for MSF and I would like to add to her calls.

Currently, unwed mothers get eight weeks of employer-paid maternity leave and their companies are required to give them an additional four weeks’ of unpaid leave. Essentially, the Government bears no cost for the maternity leave of unwed mothers. This is unlike married, widowed or divorced mothers, who enjoy eight weeks of employer-paid leave followed by eight weeks of Government-paid leave.

Unwed mothers also do not receive the Baby Bonus cash gift of $6,000 and the Government co-matching contribution of up to $6,000 in the baby’s Child Development Account (CDA). There are also several tax benefits are not available to mothers of what IRAS calls an “illegitimate child”, including the Parenthood Tax Rebate, Qualifying Child Relief, Handicapped Child Relief, Working Mother Child Relief and Grandparent Caregiver Relief. Unwed mothers also do not qualify for public rental flats from the HDB, a point raised by Mr Png Eng Huat’s during the COS debate for MND.

Madam, I would like to ask for unwed mothers to receive the same 16 weeks of paid maternity leave, including the last eight weeks paid for by the Government. The Baby Bonus cash gift and the Government co-matching contribution in the CDA account should also be extended to them. The Baby Bonus scheme, as stated on the MSF website, is to (quote) “support parents’ decision to have more children by helping to lighten the financial costs of raising children” (unquote). It is therefore not a reward for having children, but a financial assistance scheme.

I note that for the other new measures in the Marriage and Parenthood Package, like extended childcare leave, the Medisave Grant for Newborns and MediShield coverage for congenital and neonatal conditions, the same benefits are extended to unwed mothers or their children. Why not take the next logical step of equalising the remaining parenthood benefits?

Equalising benefits for unwed mothers helps not just the mother, but her child as well. The Ministry should take a child-centric view of the family, and not make the child pay the price for the past actions of his or her parents. Unwed mothers have made the choice to keep and raise their child, despite their difficult circumstances and the options of abortion or adoption. We should give them the due recognition for making this difficult choice.

I note that a single unwed mother can become eligible for the Baby Bonus if she marries the biological father of her child before her child turns 12. However some single mothers may not end up marrying the man for various reasons, and this should not prevent them from receiving the same benefits.

Providing these benefits will help reduce their financial burden, which for some unmarried women expecting a child, could tip the scales in favour of keeping the child instead of choosing to undergo an abortion. It is certainly not a silver bullet to reduce our high abortion rates, but if just one more life is saved, I think it is worth providing the benefits.

During the COS debate on 14 March, I pointed out that the issue out-of-wedlock births is a complex moral and social one, that needs to be tackled in ways other than through selective social benefits. In response, the Acting Minister assured me that the Government does not judge people by their status. I was glad to hear this, because I took it to mean that the Government is not trying to shape moral behaviour using parenthood benefits.

The Acting Minister also told me that there will always be some help that we give to married couples and there will be another package of help that we give to singles. That being the case, what alternative package of help is the Government giving to unwed mothers? I don’t think there is any universal package available, apart from means-tested social assistance.

I believe it is important that as a society, we continue to uphold the centrality of a two-parent household within the institution of marriage. This norm should continue to be promoted by the Government, for example through schools. However, breaking with this norm should not result in a mother and her child being denied the Baby Bonus and equal maternity leave. After all, we don’t encourage divorce but we still give divorcees the same Baby Bonus and maternity leave as married mothers.

While some may fear that providing equal benefits to unwed mothers may encourage the emergence of “welfare moms”, where single women get pregnant just so they can collect welfare cheques, I think this fear is unfounded in Singapore’s context. First, the quantum of benefits is hardly enough to make up for the high cost of raising children in Singapore. No rational woman will choose to conceive a child just to collect the Baby Bonus. Second, I am not asking the Government to provide additional benefits to single mothers as they do in some countries, just equal benefits.

Madam, unwed mothers face huge challenges raising their child on their own. I can only imagine how tough it must be, whenever I have to look after my kids on my own when my wife is away. Unwed mothers have to single-handedly care for their child, take on the role of both mother and father, and hold down a job to pay the bills. They also have to face the social stigma of being single and unmarried. On top of all that, they are denied many of the parenthood benefits that married, divorced and widowed mothers receive. This could add to their feeling of marginalisation from society.

Single unwed mothers need more of society’s support. As the Acting Minister said, many of them are from vulnerable families. They are mothers first and singles second, not the other way around. The welfare of their children should be our top priority.

Do we as a society believe in second chances? Do we believe that all children are born equal, and that every child is “legitimate”, no matter how he or she was conceived? If we do, then I urge the Government to accord to single unwed mothers the same parenthood benefits as all other Singaporean mothers.

by MP for Aljunied GRC, Sylvia Lim
[Delivered in Parliament on 8 April 2013]

---

I am in general support of the rationale for the Bill. However, I wish to seek some clarifications on Clauses 17 and 18 which require designated buildings to provide emergency response plans and to have Company Emergency Response Teams. Specifically, I wish to ask what role SCDF will play to collaborate or partner with building managements to comply with the new requirements, and whether the burden being placed on fire safety managers under the new scheme is perhaps too onerous.

First, the new requirement for emergency, not just fire, plans

Clause 17 amends Section 21 of the Act to require owners or occupiers of designated buildings to have in place not just a fire emergency plan but an emergency response plan. The new requirement is supposed to obligate building management to cater for all emergencies, not just fires, that may cause injury or loss of lives. Earlier in his Second Reading speech, Senior Minister of State mentioned that the emergencies had to be “fire-related” though I did not see this specifically in the legislation so I would appreciate some clarification on this point. Clause 18 will amend Section 22 to require that buildings which are currently required to have fire safety managers shall also have competent Company Emergency Response Teams as part of emergency preparedness (Ministry of Home Affairs Press Release 14 Jan 2013).

The need to prepare response plans for emergencies is self-evident, and this is especially so in our high-density urban environment. In addition, the proximity of our homes, work places and recreational spaces means that when emergency plans are drawn up for buildings, they should be able to respond to not just critical incidents from within the building but those which could potentially come from nearby facilities and even the external natural environment.

Next, what is SCDF’s optimal collaborative role in emergency planning?

The law currently places the responsibility for emergency planning squarely on the building owners and occupiers. Under the Act as well as Fire Safety (Fire Emergency Plan) Regulations 2008, they have to prepare and execute the emergency plans, conduct regular drills, and gather tenants to form Fire Safety Committees. The role of the SCDF itself is reflected as issuing of guidelines about the contents of plans, reviewing records and so on. SCDF’s role appears to be as regulator and auditor. Under this Bill, building management will have an even more onerous statutory obligation, with wider coverage to include non-fire emergencies, which will require more specialized expertise. What will SCDF do to assist building management in drawing up the required emergency response plans?

Even though the building management should bear the primary responsibility for the plans, the benefits of SCDF being involved in drawing up the emergency response plans would be tremendous. SCDF could advise on matters which the building management has no knowledge or control over. Examples of such matters would include: the potential emergencies from outside the building which the management should plan for; whether there is potential to share emergency resources with nearby facilities; and even which open areas to use as assembly points, especially at our blistering pace of urban renewal. Worldwide it is increasingly recognized that public-private partnerships in emergency planning, involving both government and private organisations, will improve the quality and practicality of the emergency plans. At the same time, through joint efforts, SCDF would have a good grasp of the private sector expertise and resources available which could be tapped upon in national emergencies.

Could Ministry explain how SCDF will collaborate with the building managements to comply with the new requirement and to improve the quality of emergency plans? For instance, would SCDF provide a template for building managements to use and adapt?

Finally, the role of Fire Safety Managers and CERTs

Clause 18 will amend Section 22 to require buildings with fire safety managers to now have Company Emergency Response Teams (CERTs) with competent in-house staff. The proposed Section 22 (3A) states that it is the building owners or occupiers are required to maintain the CERTs. However, the MHA Press Release 14 Jan 2013 indicates that it will be the responsibility of Fire Safety Managers (FSMs) to ensure that the response plan guidelines are complied with, including upgrading the competencies of the in-house teams to form CERTs.

Is this task too onerous for the FSM to be held responsible for? The FSM in a building is likely to be a mid-level employee with several corporate roles e.g. he could be an occupational safety and health officer doubling up as an FSM. To place on him the responsibility of ensuring that competent CERTs are in place which comply with SCDF guidelines on emergency response seems too onerous.

Will the government assist building managements to comply with this new requirement for CERTs and if so, how? For instance, are there any plans to develop new training courses in emergency response planning to cater specifically to the new statutory requirement for CERTs?

By MP for Aljunied GRC, Muhamad Faisal Bin Abdul Manap
[Delivered in Committee of Supply on 14 March 2013]

Puan saya ingin mengutarakan 2 cadangan mengenai TTFS.

Yang pertama Puan, Menteri Yacob dalam menjawab soalan parlimen saya mengatakan bahawa jumlah dana TTFS yang tidak diagih disalurkan kepada Dana Pendidikan Mendaki (EDF) dimana dana ini digunakan untuk skim bantuan pendidikan dan program pendidikan yang dikendalikan oleh Mendaki. Disini, saya ingin mencadangan agar sebahagian dari lebihan dana TTFS diketepikan dan dibentuk sebuah Biasiswa Pos-Graduan atau Post Graduate Scholarship.

Biasiswa Pos-Graduan ini boleh diperuntukkan serta dikhaskan kepada bidang-bidang pengajian yang khusus yang boleh melahirkan pakar-pakar yang memberi manfaat kepada masyarakat Melayu Singapura seperti bidang Ekonomi dan Siosologi.

Puan, Menteri Yacob pernah mengatakan dalam sebuah sesi temuduga melalui Radio Warna pada April 2010 bahawa Masyarakat Melayu kekurangan pakar-pakar dalam menangani isu-isu sosial yang membelenggu masyarakat kita. Beliau juga mengatakan bahwa lebih banyak pakar-pakar Melayu diperlukan untuk mengatasi masalah keluarga pincang serta gejala dadah.

Saya rasa dengan adanya bantuan biasiswa ini, ia boleh merangsang serta membantu individu-individu untuk melanjutkan pengajian keperingkat ynag lebih tinggi dalam bidang-bidang yang khusus ini agar akan terlahir kelak pakar-pakar yang diperlukan untuk menangani isu-isu sosial masyarakat Melayu di Singapura.

Puan, Seterusnya, saya berharap Pemerintah dapat mempertimbangkan untuk membenarkan golongan individu-individu dari keturunan campuran atau ‘mixed parentage’ seperti sesetengah kaum India Islam diberi peluang untuk meraih memanfaat daripada TTFS.

Puan, saya amat memahami bahawa TTFS hanya diperuntukkan kepada masyarakat Melayu sahaja. Namun seperti yang diketahui, sebilangan besar kaum India Islam dan golongan keturunan campuran yang lain di Singapura menjalani kehidupan yang sama seperti masyarakat Melayu. Bahasa utama mereka adalah Melayu dan mereka juga mengamalkan adat-budaya Melayu. Malah sebahagian besar berwajah seperti orang Melayu. Hanya kad pengenalan yang menandakan mereka sebagai India Islam dan sebagainya kerana mengikut bangsa ayah mereka.

Bagi isu ini, saya mencadangkan agar ditubuhkan sebuah Jawatankuasa dimana peranan Jawatankuasa ini semestinya seiras dengan peranan Jawatankuasa Masyarakat Melayu (Malay Community Committee) yang menentukan samaada seseorang individu itu layak untuk bertanding dalam Pilihanraya di Kawasan Undi Berkumpulan (GRC) sebagai Calon Minoriti Melayu. Golongan yang saya sebutkan tadi boleh membuat permohonan kepada JawatanKuasa ini dan jika perlu ditemuduga untuk menentukan samaada layak untuk menerima TTFS atau sebaliknya.

Puan memandang kehadapan, saya rasa penubuhan Jawatankuasa seperti ini adalah munasabah terutama sekali tren perkahwinan antara kaum serta perkahwinan antara rakyat Melayu Singapura dan rakyat asing semakin meningkat.

By MP for Aljunied GRC, Muhamad Faisal Bin Abdul Manap
[Delivered in Committee of Supply on 14 March 2013]

Mdm, many pro-family policies and workplace initiatives have been rolled out over the last two years towards the strengthening of family ties and fostering a more conducive environment for the family. This includes paternity leave and the extended childcare leave introduced by this government through the Marriage and Parenthood Package. These measures are certainly a welcome relief for many working families.

As a society, it is important to have in place a support system to nurture the young in our society and prepare them to undertake the leadership of this nation in the future. It is also essential to provide our older generations who have contributed so much to Singapore’s nation-building sufficient care in their retired years. At the same time, our disabled must also be able to lead a dignified life in Singapore with support from the state wherever possible.

Mdm, there have been many improvements made to prepare our society for the aging population. Facilities have been enhanced to enable the disabled to travel far more easily within our urban environment. Much has been done, but much remains to be done especially with regard to the care that these groups receive from their own family. Family is often the first line of support and it is important for us to enhance the family unit and strengthen the support given to the elderly and the disabled within the family unit. This is particularly critical for many lower income families.

With the above in mind, I would like to propose to the Ministry to introduce a Family Care Leave, applicable in particular to caregivers of the elderly, the disabled and individuals with chronic illnesses such as stroke and kidney disease.

Mdm, I would like the Ministry to look into the feasibility of implementing a Family Care Leave in their employment contracts.

Thank you.

By MP for Aljunied GRC, Low Thia Khiang
[Delivered in Committee of Supply on 14 March 2013]

Currently CPF members are allowed to use their Ordinary Accounts (OA) to service their housing mortgage loans up to Valuation Limit (VL) of the property.

CPF members below age 55, who have reached the VL in using the CPF OA, must set aside half of the prevailing Minimum Sum in their OA and Special Account (SA) before they are allowed to continue using their CPF monies to finance their mortgage loans.

I have come across cases where the CPF members’ OA balances were sufficient or more than sufficient to make full redemption of their outstanding CPF mortgage loan balances and free themselves from the financial burden of servicing their home mortgages.

Unfortunately, they were not allowed to do so because of the Minimum Sum requirement.

If these CPF members were allowed to make the full or partial redemption of the mortgage loans using their available CPF OA balances, they would save considerable sums on their mortgage interest.

The loan value determined by the CPF is the lower of the purchase price or the valuation price of the HDB flat at the time of purchase. For many of these CPF members, the valuation price of their flats was low relative to today’s HDB flat prices. Hence, there is little risk of such CPF members in using their CPF OA balances exceeding the market value of the flat since it was capped at the lower of purchase price or valuation at time of purchase.

Also most of them would continue to work beyond the age of 55 and could continue to contribute to their retirement account savings.

I urge the Minister to consider allowing such CPF members to continue using their CPF OA balances to make full or partial redemption of their mortgage loans.

By MP for Aljunied GRC, Low Thia Khiang
[Delivered in Committee of Supply on 14 March 2013]

The Minimum Sum amount was set at $80,000[1] in 2003 and targeted to reach $120,000 by 2015. In order to maintain the Minimum Sum amount value in 2003 dollars, the sum is adjusted yearly for inflation.

In 2012, due to higher movement in the Consumer Price Index (CPI), the increase in 2013 was supposed to be $12,000 but MOM decided to moderate the increase.

Although the Government decided not to factor in the full increase based on the CPI, and instead, to spread the increase over the next few years and to shift the target of reaching Minimum Sum to 2015, the Minimum Sum now looks to be a moving target. To most Singaporeans, we wonder what would be the eventual amount for the Minimum Sum when we reach our time to retire.

I am of the view that it is timely to review the Minimum Sum and to establish a reasonable yearly adjustment rate that is not only based on increase in CPI.

The CPI may not be the best indicator for the computation of inflation for the CPF Minimum Sum as components such as imputed rental and private road transport are not as relevant to retirees for their retirement needs.

There is anxiety amongst middle lower and lower income wage earners that the amount of money they can withdraw from their own CPF savings at the age of 55 would decrease with the ever-corresponding increase in the Minimum Sum.

By MP for Hougang SMC, Png Eng Huat
[Delivered in Committee of Supply on 14 March 2013]

Low wage workers especially those with little education or qualifications need help beyond government funded top ups, training, and re-training.  They need to know their basic rights as contract, hourly-rated, or part-time workers. And more importantly, they need government intervention to ensure they have a fair chance of making a decent wage to support their families.

Some of these workers earn only $5 an hour and work on contractual or daily-rated basis i.e. no work, no money.  Many will not be given medical benefits as well.

At my second MPS, right after I was elected, an elderly man waited hours to share with me about his experience as a low wage worker.  He works as a security guard and earns a basic salary of $700 a month.  From the look on his face, one could easily tell he had a hard life.  He just turn 63 this year and I believe the enhanced WIS as announced in Budget 2013 will bring some relief to him.

Over the past 9 months, I met more low wage workers and even had a good look at some of their pay slips.  From the way some of their salaries are structured, these workers will need to clock a lot of overtime work if they want to take home more than $1,000 a month in pay.

The salary structure of these workers comprises a low basic pay and a host of generous allowances for transport, attendance, etc.  But what seemed to be generous turned out to work against them when they did overtime work.  Most of them will find out on payday that the stipulated 1.5 times overtime pay is based on the low basic salary and not the total pay package.  Technically, these workers are paid less per hour for working overtime.  And financially, these low wage workers are better off taking on 2 jobs than doing overtime work.  These workers cannot seek redress except to resign as such employment terms are legal.

How is the Ministry going to uplift the salaries of these low wage workers when the incentive to earn more money through overtime work just doesn’t make sense?  Perhaps the Ministry can look into changing the computation of overtime pay for salaries below a certain threshold to comprise all allowances.

I believe if low wage workers have the resolve to move up the social ladder by working harder and longer, they should be adequately compensated.