I refer to the article “AHTC to transfer $14m to sinking fund” (Straits Times, Jan 17).
It states that “The Aljunied-Hougang Town Council (AHTC) has promised to make up for a shortfall in its sinking fund by transferring close to $14 million to it this year, said its independent auditor KPMG.
The transfer will be made in four instalments of close to $3.5 million each – in February, May, August and November.
According to a monthly KPMG progress report released by AHTC yesterday, this amount will cover a shortfall of $5.3 million in sinking fund transfers that should have been made between August 2011 and March 2016.
“With these latest promises on sinking fund transfers, AHTC has resolved two audit points pertaining to the incorrect computation of required transfers to the sinking fund, shortfalls or delays in transfers to sinking fund bank accounts, and the incorrect use of sinking fund monies.”
In this connection, as I understand it – Section 34 of the Town Councils Act states that 100% of the accumulated surplus has to be transferred to the sinking fund. if the winning party is a different one in an election.
What was the rationale to amend the legislation such that the accumulated surplus has to be transferred to the sinking fund when there is an election – thus, depriving residents of the surplus for operating expenditure. And why 80% if the same party wins, but 100% if a different party wins?
In this regard – AHPETC’s annual report for 2012 indicated an accumulated surplus of $5,471,371 for the year ended 31 March 2011.
So, if Aljunied is lost in the next elections – does it mean that the residents would have to suffer twice – of having 100 percent of their operating surplus transferred to the sinking fund, and arguably starving the residents of operating funds?