AHTC's FMSS issue resurfaces in parliament on AIM debate

By Terry Xu

In the Monday’s debate on Ministry of National Development (MND) review of the AIM transaction in parliament, Minister of National Development, Mr Khaw Boon Wan said in his round-up speech and responses that Aljunied Hougang Town Council (AHTC) had awarded a contract to manage the Town Council Management Software (TCMS) to FM Services & Solutions Pte Ltd (FMSS) without a tender in 2011 and subsequently extended its service with AHTC for a second term as the sole tenderer.

He said that the financial rules listed in the town council act allow for a waiver of tender, and in this case of AHTC, MND did not intervene as “latitude” were given to elected MPs in their decisions regarding their wards which is consistent across all the constituencies as with the AIM tender.

He then proceeded to give a background of FMSS as being formed by two individuals who are closely associated with the Workers’ Party. Former Hougang Town Council (HTC) General Manager, Ms How Weng Fan and her spouse, Mr Danny Low Chong Meng a contractor to HTC, who also were assenter and proposer for former MP for Hougang, Yaw Shin Leong’s candidacy during the elections, etc.

He pointed out that FMSS was only formed on 15 May 2011, just 4 days after the general elections 2011.

FMSS was awarded a $5.2 million contract from AHTC without a tender in 2011, and one year later was the only bidder being awarded a $16.8 million 3-year contract. The tender for the Town Council Managing Agent was also given to FMSS at $3.9 million a year.

In response to Mr Khaw’s statements, Workers’ Party Chairman, Ms Sylvia Lim explained that AHTC had no time to call for the tender after the elections due to the state of urgency brought about by the termination clause with the software vendor, AIM Pte Ltd.  She also highlighted that the wavier of tender was only made under the conditions set in the provisions of the Town Councils Financial Rules.

And one year later when an open tender was opened, three companies responded to the tender but at the end only one bidder, FMSS submitted their tender. Due to the awkward position of having only one bidder, AHTC called for a special audit on the sole tendering company and the auditing firm found that FMSS has met the requirements required for the tender.

She also states that AHTC holds full ownership of the software license for the TCMS developed by the town council. While the new TCMS contract by the PAP town councils with NEC is operating on a leasing model.

On awarding of the tender for the Managing Agent to FMSS, Ms Sylvia Lim’s defense to this was that there were only 3 companies in Singapore that provide town council management services, namely CPG, Esmaco Pte Ltd and EM Services Pte Ltd and all 3 were having business engagements with the PAP town councils. The incumbent managing agent had earlier asked to be released from providing services to AHTC.

In view of the earlier situation experienced with the incumbent agent, Ms Sylvia Lim considered to engage an agent without prior engagements with the PAP town councils. FMSS is hence selected as an experienced vendor who has worked with Hougang Town Council (HTC) and is currently not engaged with the PAP Town Councils.

Through a search via ACRA, it is noted that Mr Danny Loh Chong Meng had originally been running a small business named FM Solutions & Integrated Services (Sole-proprietor registered since 2004), which had been said to be have serviced HTC for a period of time.

As of today, FMSS has four directors — Mr Danny Loh Chong Meng (Appointed May/2011), Ms How Wen Fan (Appointed May/2011), Mr Yeo Soon Fei (Appointed June/2011) and Mr Liang Zhong Sheng (Appointed June/2011) with a distribution of 50%, 20%, 20%, 10% shares respectively of the $500,000 paid up capital.