In my First Open Letter to you in June 2015, I explained three main points concerning various allegations made against Aljunied-Hougang-Punggol East Town Council (AHPETC). These were:
1. AHPETC does not and cannot reserve contracts for “friends” due to the public tender process;
2. The alleged “overpayment” by AHPETC to its former Managing Agent (MA), when compared to rates paid by PAP TCs in 2014, was an exaggeration, looking at the rates paid by PAP TCs in 2011, 2012 and 2013 according to data provided by the Ministry of National Development (MND);
3. The MA rates that AHPETC agreed to pay its MA in 2012 were arrived at taking into account the MA rate paid by the PAP management of Aljunied TC to its former MA.
In this Second Open Letter, I would like to clarify and reassure all residents that AHPETC places your interests at the heart of its work and continues to make improvements to its financial management.
This letter will cover the issue of Conflicts of Interest and AHPETC’s financial position.
1. Conflict of Interest and Related Party Transactions
There have been allegations concerning related party transactions between AHPETC and its former MA, FM Solutions & Services Pte Ltd (FMSS).
First, there is no longer any issue, as AHPETC is now directly managed and does not outsource its work to an MA. The previous MA contract expired on 14 July 2015, and there were no bidders to take over the MA services after 14 July 2015.
Since 15 July 2015, AHPETC has been self-managed. This means that AHPETC is now directly hiring staff to handle estate, finance, administration and other tasks, instead of outsourcing the work to an MA.
Under direct management, AHPETC’s contractors continue to deliver services under the existing contracts, now supervised by TC’s directly hired staff.
Second, there was never any conflict of interest whatsoever between the Workers’ Party (WP) or any of its Members of Parliament (MPs) and FMSS. Neither WP nor any of its MPs or members has any interest in the business of FMSS. None of the directors and shareholders of FMSS is a member of WP.
Third, there have been accusations that when the MA was working at AHPETC, the husband and wife team who owned FMSS could freely sign payments to themselves. This is not true. When WP took over in 2011, one of the first decisions made by the new Aljunied-Hougang Town Council was to require any cheques to the MA, no matter how small the amount, to require the counter-signature of AHPETC Chairman and Vice-Chairmen who have no interest in the MA’s business.
2. Financial Position of AHPETC
Some people have accused AHPETC of bankruptcy and running huge deficits that are not sustainable, and also warned residents of other towns not to vote for WP so as not to subsidise AHPETC. These allegations are misguided.
AHPETC filed its audited accounts for FY 14/15, on time, by 31 August 2015. Though these accounts show AHPETC in annual deficit, this is because AHPETC has still NOT received its annual S&CC operating grant of $7.2 million from the government, which would normally have been paid to all Town Councils in April 2014. Taking into account the $7.2 million in grant which AHPETC expects to receive, AHPETC’s annual income and expenditure statement would show an annual surplus of $1.7 million.
The past operating deficit was largely the outcome of higher tender price for various service contracts and start-up costs.
The current positive position came about through a combination of steps taken by AHPETC. These included lowering its utilities costs by using contestable energy, reducing its general and administrative expenditure, and increasing its revenue.
Throughout the difficult initial years, AHPETC management believed that it could improve the TC’s financial position, and the latest audit shows that it has. We expect to further consolidate and improve AHPETC’s financial position going forward.
We have done our best to serve residents, and I would like to express appreciation to our staff for their contribution to the progress we have made and to our residents for their support and understanding.
SYLVIA LIM CHAIRMAN ALJUNIED-HOUGANG-PUNGGOL EAST TOWN COUNCIL
A resident of a new Housing Board development in Hougang has gone to court to obtain a refund for the service and conservancy charges (S&CC) she paid to the Aljunied-Hougang-Punggol East Town Council (AHPETC).
Corporate travel manager Melinda Teo, 37, lodged a report with the Small Claims Tribunal on Monday (June 22), in a bid to get back the $367.20 that she paid in S&CC between November last year and May this year.
Ms Teo, who lives in the 680-unit Parkland Residences, a Design, Build and Sell Scheme (DBSS) project, said she should not have to pay the fees to the Workers’ Party-run town council as it took over the management and maintenance of the property only on June 1.
Before that, the project’s developer, Kwan Hwee Investment, had to step in to clean the common areas.
Earlier this month, more than 300 residents of Parkland Residences sent a petition to the town council demanding to have their S&CC waived or refunded. But their appeal was not answered by either the town council or the Workers’ Party MPs, said Ms Teo.
However, an AHPETC spokesman had said in response to media queries earlier this month that the town council would have to compensate Kwan Hwee Investment for the maintenance work done before June 1. As such, it cannot return the S&CC to residents, it told reporters.
Following Ms Teo’s move to take court action, a representative of AHPETC must attend a meeting at the Small Claims Tribunal on July 2, according to a court document issued to the town council.
Otherwise, an order could be given against the town council in its absence. The order could include a mandatory compensation to the claimant for claims below $10,000.
Ms Teo said she decided to go down the legal route as “our e-mails and petition have only received the silent treatment from the MPs and town council”. She added that several neighbours have expressed interest in filing similar claims with the tribunal.
The Aljunied-Hougang-Punggol East Town Council (AHPETC) is “technically insolvent” and its chairman Sylvia Lim had been “economical with the truth” when she said in Parliament in February that the town council has been making transfers to its sinking fund for the 2014 financial year.
These were the charges levelled today (May 5) by the Ministry of National Development’s (MND) legal counsel — and were unchallenged by AHPETC — during the second and final day of a hearing on the ministry’s application to the courts to appoint independent accountants to safeguard government grants to the town council.
AHPETC had not made payments to the sinking fund for two quarters of FY2014, even though these were “mandatory obligations”, as the Attorney-General’s Chambers deputy chief counsel for litigation Aurill Kam, who is representing the MND, put it.
The court had heard that AHPETC’s income from service and conservancy charges (S&CC) was insufficient for it to make the quarterly sinking fund transfers. If the town council had made the transfers as required, it would not have enough money, Ms Kam noted. “From that point of view, it would not be an overstatement to say that (AHPETC) is technically insolvent,” she said.
The MND has withheld the service and conservancy charges (S&CC) grants to AHPETC for financial years 2014 and 2015. Its application was meant to safeguard fresh grants disbursed, following a report in February by the Auditor-General’s Office (AGO), which found major lapses in AHPETC’s financial management, governance and compliance with the Town Councils Act.
“There is a suggestion that (MND’s application) is unprecedented. We submit that the adverse findings in the AGO report is unprecedented. The conduct of the defendant is unprecedented. Their response to calls to do the responsible thing is unprecedented,” Ms Kam said.
She added: “We say that unless these independent accountants are appointed, no serious steps will be taken to credibly review whether there has been any wrongful payment, breach of duty or unlawful conduct.”
Referring to Ms Lim’s comments in Parliament, Ms Kam said: “The reality was that at that time, the January 2015 transfer had already been missed. This wrong impression was reinforced when the defendant informed this court on March 27 this year, that it did not need fresh S&CC grants urgently, and could do without the funds for the next three months.”
AHPETC lawyer Peter Cuthbert Low had argued on Monday that the courts do not have the power to assign independent accountants to co-sign payments a town council makes using government grants, and that the Town Councils Act was intended to give elected Members of Parliament and town councillors full autonomy in managing town council funds — and to be accountable only to their residents.
MND had proposed that the court appoint Mr Ong Chao Choon and Mr Chan Kheng Tek from accounting firm, PriceWaterhouseCoopers (PwC), to be the independent accountants, or any other people the court deems fit and proper.
Today, Mr Low objected to the ministry’s nomination of the two individuals because PwC was involved in the AGO report. “So my client’s position is that there is a suspicion of bias,” said Mr Low. “We are not saying that… they will be biased, but because they came from the same auditing firm and PwC was the firm which was engaged.”
He added: “They need not come with preconceived notion, but as long as there is a perception…” Instead, the town council proposed that a “neutral” third party such as a retired judge or a Senior Counsel should nominate the independent accountants.
To address weaknesses in its accounting practices, AHPETC has hired Audit Alliance as its auditors and sole-proprietorship Business Assurance as its financial consultant. Lawyer Terrence Tan, who is also representing AHPETC, said the town council is on track to submit its overdue accounts for the FY2013/2014.
Judgement was reserved. After the hearing, Ms Lim told reporters that the town council looks forward to a fair outcome.
To start, we should also note that PAP activists Victor Lye, who made a Facebook post thanking his team for distributing the fliers, and Muralidharan Pillai, who confirmed to media that the flyers were from PAP, have both clearly indicated the origins of the flyers. In spite of that, the documents in question do not carry any PAP logo. The flyers were also distributed past midnight, as if done to avoid direct contact with residents.
Notwithstanding the highly mysterious and secretive air surrounding the distribution, Muralidharan had insisted to media that they had nothing to hide and that “there was no difficulty in understanding that (the flyer) was from the PAP”.
Precedence set by the SDP
Ms Chee Siok Chin was jailed for a week for distributing flyers which were critical of the Government.
You are charged that you, on the 10th day of September 2006 at about 12:15 pm, in the vicinity of Raffles City Shopping Centre, North Bridge Road, Singapore, which is a public place, together with 5 persons did participate in an assembly intended to demonstrate opposition to the actions of the Government, which assembly you ought reasonably to have known was held without a permit under the Miscellaneous Offences (Public Order & Nuisance) (Assemblies & Processions) Rules, and you have thereby committed an offence punishable under Rule 5 of the said Rules.
Mark Chua
Senior Investigation Officer
Central Police Division
29 December 2008
The SDP members were charged under Rule 5 of the Miscellaneous Offences (Public Order & Nuisance) (Assemblies & Processions) Rules which states: Any person who participates in any assembly or processions in any public road, public place or place of public resort shall, if he knows or ought reasonably to have known that the assembly or processions is held without a permit, or in contravention of any term or condition of a permit, be guilty of an offence and shall be liable on conviction to a fine not exceeding $1,000.
It is difficult to imagine that the legislative intent of this law was to curb the handing out of flyers, or similar communicative-type activity. I daresay the law was meant to prohibit gatherings that pose a threat to public peace, e.g. gangs out to intimidate or fight, or sit-ins that block traffic. The name of the law, after all, is Miscellaneous Offences (Public Order and Nuisance) Act.
Moreover, in actual practice, no action is taken against the hundreds, if not thousands, of people who stand at metro stations handing out flyers, or even those who interfere with traffic in some way, e.g. stopping people to sell them insurance
The point made by Mr Au definitely makes sense – the execution of laws should target the intended consequence, rather than the offending act itself. Unfortunately, the way the law was applied in the case must be taken into account in evaluating the present facts.
In the judgement passed by District Judge Chng Lye Beng, it is understood that, if a group of five or more persons distribute flyers of a political nature in a public place without a permit, they may likely be in breach of the law. Let us now compare the first three elements of the offence with the facts of the case at hand.
Five or more persons?
After the distribution of the flyers, Mr Lye posted this image on his Facebook page. According to his post, the people featured in this picture are the “(PAP) activists who worked through the night… to distribute flyers.” From this picture, one can easily make out seven people, which suggests that there were more than five people who helped to distribute the flyers. There might also have been more who helped out in the distribution but were not featured in this photo.
Post on Mr Lye’s Facebook page after the flyer distribution
Public places?
The flyers in question were placed at the doors of HDB flats, as seen in the picture above. This means that Mr Lye and his team were operating at the common corridors of HDB flats. It is also clear from the photographs taken from Mr Lye’s Facebook page that the flyers were left outside the flats – which suggests that they in no way entered into the home, or what might be considered private property.
Flyers of political nature?
To give the reader a better understanding of what would constitute ‘political nature’, it would be good to look at the contents of the flyers that the SDP members distributed. The flyers contained the following words:
Tired of being a voiceless, 2nd class citizen in your own country without any rights? Sick of the Ministers paying themselves millions of dollars while they tell you to keep making sacrifices for Singapore? Then join us for the
EMPOWER SINGAPOREANS
RALLY & MARCH
Saturday, 16 Sept 2006, 11 am
Speakers’ Corner, Hong Lim Park
FOR MORE INFORMATION, GO TO
www.singaporedemocrat.org
In comparison. here are the contents of the flyers that the PAP activists distributed:
Comparing the contents of the two flyers, I opine that if the former can be constituted to be of a political nature, the latter undoubtedly is of a political nature too. The later also makes explicit references to the Workers’ Party and its Town Councils which should dissipate any doubts one may have about the political nature of the flyers.
Without a permit?
Prima Facie, it seems as though the actions of the PAP Aljunied team on Friday evening have satisfied the first three elements of the offence. In other words, Mr Lye and his team of five or more persons did distribute flyers which were of a political nature in a public place.
The question now would really be whether they had a permit for the distribution of the flyers. Both Mr Lye and Mr Muralidharan had not any any point in time produced any evidence to show that a permit has been obtained. If they do not have such a permit, they would technically be in breach of the law.
Alternative charge of Sedition
However, the SDP is not the only precedence we have of people distributing flyers without a permit and getting into trouble for doing so.
In what was popularly referred to as the “poison letters“, a flyer that was critical of the PAP was distributed to residents in the heartlands via letter boxes. The Strait Times described the flyer as “an A4-sized sheet with the criticisms in English and Chinese, made allegations about corruption and exploitation and complained about cost of living issues, among other things.”
It was reported that Police investigations were ongoing although we didn’t get to hear the end of the matter. TODAY reported that the flier was in breach of the Sedition Act which states, among other things, that a seditious tendency is one which seek:
(a) to bring into hatred or contempt or to excite disaffection against the Government;
(b) to excite the citizens of Singapore or the residents in Singapore to attempt to procure in Singapore, the alteration, otherwise than by lawful means, of any matter as by law established;
(c) to bring into hatred or contempt or to excite disaffection against the administration of justice in Singapore;
(d) to raise discontent or disaffection amongst the citizens of Singapore or the residents in Singapore
The “poison letter” incident raises another bag of issues for the PAP flyer distribution in Aljunied GRC. While the target of the flyers – the Workers Party – do not form the government, its members are rightfully elected Members of Parliament, who are part legislative arm of the government. The contents of the flyers might possibly be also be construed instigate dissatisfaction among the residents of Aljunied against WP. Might it have the consequence of causing political unrest? The potential is unthinkable. However, to a certain extent, it may be possible to interpret the contents of the flyers to amount to a “seditious tendency” under subsections (b) and (d).
Conclusion
Ultimately, if this case ever goes before the courts, the issue of the legality of the flyer distribution lies with the Judiciary. Personally, I do hope that it never will, just as I wished the case of SDP and the “poison letter” never did. Even though I believe the actions of Mr Lye and team are akin to a political lowblow, I am of the firm opinion that, as far as the law is concerned, they should be free to do what they do – just like how all political parties distribute flyers during their house visits. I an no fan of laws that can be interpreted and applied in a manner that is over-reaching and discretionary.
However, should a police report be made by a recipient of the flyers against the PAP activists, might it be an uphill task for PAP activists to justify the legality of this flyer distribution?
The Aljunied-Hougang-Punggol East Town Council (AHPETC), run by the opposition Workers’ Party, was on Friday (Nov 28) found guilty of holding a festive trade fair, without permit, earlier this year.
At the heart of the case, is whether the town council, flouted Section 35 of the Environmental Public Health Act, by holding a Chinese New Year fair, without a permit. The National Environment Agency, prosecuting the case, said it did.
The town council, represented by lawyer Peter Low, challenged the charge. Among the defence was the argument that the event was simply a “mini-fair” which does not require a permit. It also took issue with the need to get a letter of support to organise the fair, from the area’s Citizens’ Consultative Committee, which is chaired by a People’s Action Party grassroots leader.
The judge ruled on Friday that since Section 35 of the Act created a strict liability offence, this means prosecution does not need to prove beyond reasonable doubt that AHPETC deliberately did not intend to obtain a permit to hold its fair.
As for the defence’s argument that AHPETC can hold events without a permit in common areas that it manages, the judge said it seems the town council’s objection was related to the suitability of the application form and not the fact that a permit was required. He said the court is not an appropriate forum to examine conditions tied to the permit application form.
Commenting on the decision, AHPETC Vice Chairman Pritam Singh said: “We’re disappointed with the verdict. We will take advice from our lawyers as to the next course of action going forward. We won’t rule anything out.”
He added that no town council funds were used with respect to this case, saying: “The MPs are contributing to the lawyers’ fees.”
The court was adjourned until Dec 24 for mitigation and sentencing.
