MND explains why AHPETC received less grants, MOS Lee's statement

Almost two weeks after the Ministry of National Development (MND) released a statement from its Minister of State, Mr Desmond Lee criticising the Aljunied Hougang Punggol-East Town Council (AHPETC) for “poor financial management”, the Ministry clarified with media yesterday on MOS Lee’s statement.
MND was responding to questions “raised in various forums” about why the grants that AHPETC, managed by the opposition Workers’ Party (WP) was lower compared to the grants received by town councils managed by the ruling People’s Action Party (PAP).
“Some alleged that government grants helped PAP-run town councils run an operating surplus instead of a deficit,”, indicated media reports.
However, MND did not clarify on why MOS Lee found it necessary to draw reference to the surplus of S$3.3 million that was transferred from Aljunied Town Council to AHPETC’s sinking funds when WP took over, which would not count towards operating expenses.
Mr Lee had said, “Before merger (or Hougang and Aljunied town councils after GE2011), Aljunied had an operating surplus of S$3.3 million. Within two years, the merged AHPETC’s financial position has deteriorated rapidly. The operating surplus of S$3.3 million Aljunied had in FY10 had turned into an operating deficit of S$734,000 in FY12.”
Instead, MND clarified to media that “S&CC (service and conservancy charges) operating grant is allocated to all Town Councils based on the number of HDB flat units and the flat types”, and that AHPETC received less compared to other town councils because it has fewer small-sized flats.
Citing the examples of Tanjong Pagar Town Council and Ang Mo Kio Town Council, which respectively have 39% and 59% of flats that are 3-room or smaller units, AHPETC had 29%, which MND said explained why the grants AHPETC received was lower.
MND also attempted to justify why AHPETC received a much lower grant quantum compared to the previous Aljunied Town Council, run by the PAP.
“Of the S$26.7 million in government grants received by Aljunied in FY10, S$19.2 million was a one-off grant to help TCs offset the cost of the Lift Upgrading Programme,” said MND in media reports. “So the perceived drop in government grants after FY10 is due to the one-off grant.”
MND did not elaborate on whether other town councils like Ang Mo Kio and Tanjong Pagar are receiving similar grants in the current financial year, which would have helped them off-set deficits, or how such grants are calculated or allocated.
The committee which oversees the approval of funds to town councils is the Community Improvement Projects Committee (CIPC). All members of CIPC are members of the PAP, including Mr Desmond Choo, the PAP candidate who was defeated twice at the polls in Hougang Single Member Constituency.
The Singapore government online directory indicated that “the function of the CIPC is to provide funding support for community improvement projects proposed by Citizens’ Consultative Committees (CCCs). The types of CIPC projects include basic infrastructural facilities, recreational facilities and communal amenities in HDB housing estates, urban and rural areas.”
Mainstream media have also reported earlier this year that “CIPC funds have long been a sticking point in opposition wards as they are given to town councils through the CCCs, which are grassroots bodies under the People’s Association.”