The Auditor General Office (AGO) released its auditing report for the FY2017/18 on government ministries and statutory boards today (17 Jul).
One of the statutory boards audited was People's Association (PA), which the late Lee Kuan Yew once made a comment about its close relationship with the PAP.
At a public forum, Mr Lee once commented on what some PRC officials had observed when they were visiting Singapore. He said, “They (PRCs) discover that the People’s Action Party (PAP) has only a small office in Bedok. But everywhere they go, they see the PAP – in the RCs (residents’ committees), CCCs (citizens’ consultative committees), and the CCs (community clubs).”
All these grassroots organizations (GROs), of course, fall under the purview of PA.
In any case, in its report, AGO censured PA for not obtaining proper approvals for award of contracts and variation.
It said that it has test checked 189 purchases amounting to $6.03 million made by PA's 18 GROs during this audit. Out of the 18 GROs, 13 (or 72%) were found not to have obtained proper approvals for award of contracts and variation for some 25 purchases totalling $619,900.
Some of the lapses highlighted by AGO were as follows:
a. 19 purchases (totalling $497,400) made by 10 GROs without approval, with only verbal approvals, or with approvals obtained only after goods and services had been delivered.
b. 6 purchases (totalling $122,500) made by five GROs with approvals for award of contracts and variation obtained from the wrong parties. The approving parties were either not authorised or had lower approval limits.
"Not obtaining approvals from the appropriate authorities before awarding the contracts would undermine the role of the approving authorities and the award of contracts would not be subject to the scrutiny of the relevant authorities," AGO said.
"Delays in seeking approval indicate laxity in controls over the award of contracts. Retrospective approvals weaken the controls put in place to ensure that contracts are properly considered by the approving authorities before they are awarded."
"Recurring lapse" on the part of PA
AGO also noted that failure to obtain proper approvals for award of contracts is a "recurring lapse". A similar observation was raised in the Report of the Auditor-General for the financial year 2014/15, three years ago.
PA explained that some of the lapses pointed out by AGO resulted from "unexpected requirements" that arose at short notice. Nevertheless, PA acknowledged that proper approvals should have been sought for award of the contracts and that it would review its financial procedures and strengthen the approval processes to cater for contingency scenarios and ensure that proper approvals from the appropriate authorities were sought.
PA also said it would step up training on procurement for the GROs.
Just the tip of the iceberg?
According to PA's website, it has some 1,800 GROs reporting to PA.
The Auditor-General notes in the report, "As audits are conducted on a test check basis, they do not reveal all irregularities and weaknesses."
This means not all 1800 GROs are checked.
In the annual audit for 2014/15, AGO found lapses in the management of tenancy contracts in 35 community club/centre management committees (CCMCs) and common procurement irregularities among the GROs.
In total, the AGO test-checked 115 GROs and many were found to have financial lapses.
Many of which are staffed by members of PAP, and it remains a question as to how many of those amongst the unchecked 1,667 GROs would have problems with their award of contracts to vendors and contractors.