Blog post alleges greater lapses in procurement in other government agencies than in AHTC based on audit data observations

Blog post alleges greater lapses in procurement in other government agencies than in AHTC based on audit data observations

An unidentified author by the name, Kueh Lapis, hosted on GitHub, has made several noteworthy observations regarding the alleged lapses in procurement made by the Aljunied-Hougang Town Council (AHTC), upon which a high-profile lawsuit was filed against three Workers’ Party Members of Parliament and the town councillors for AHTC.

The source claims to have taken “a data-driven approach” in analysing the “scale of the Workers’ Party’s audit lapses” in comparison to that of other public agencies with similar audit cases listed by the Auditor-General’s Office (AGO) from 2012 to last year.

The alleged lapses of procurement by AHTC were rehashed in the article as following:

1. Procurement, in that FMSS was appointed without an invitation to tender. resulting in $6.6 million being paid to FMSS in FY2012-13.

According to the source’s interpretation of the data available from the AGO, the AHTC case is not an isolated one involving “lapses in management of public monies,” with “between 6 to 20 government agencies” having been pinpointed by AGO for similar lapses, citing agencies such as National Parks Board (NParks) and National Research Foundation Singapore (NRF):

  • NPARKS ($20.8 mil). AGO found another three consultancy services contracts that were awarded via waiver of competition without compelling reasons. NParks cited tight timeline as the main reason for waiving competition in the papers seeking approval. There was, however, no evidence to show that the tight timeline was caused by unforeseen and urgent events. (Source: AGO)
  • NRF ($2.3 mil). AGO found that a contract for project management services was awarded via waiver of competition to a vendor without reasonable grounds. […] NRF had breached Government procurement principles of transparency and open and fair competition. (Source: AGO)

2. Lapses in procurement process, in that LST Architects was engaged by AHTC for 10 projects at a higher price than Design Metabolists in 7 of these projects “without adequate justification,” which “caused AHTC to incur an additional aggregate amount of $2.8 million.”

Such lapses were also found in agencies such as NParks and Health Sciences Authority (HSA), among others:

  • NPARKS ($2.37 mil). NParks allowed a consultant to commence services before approval was obtained to call a limited tender for the consultancy services inviting only the consultant to bid. By doing so, NParks had prematurely communicated to the consultant that it had intended to award the contract to the consultant. (Source: AGO)
  • HSA ($25.6 mil). Five incumbent contractors were awarded contracts even though their tender proposals did not fully meet the tender requirements. There were also irregularities in the evaluation of the tenders. HSA did not uphold the Government procurement principles of transparency, open and fair competition and value for money for these five tenders. (Source: AGO)

3. Lapses in related-party transactions, in which WP leaders had allegedly “set up a flawed system of governance which facilitated improper payments made to FMSS.”

The source added: “Of the $33.7 million, $6.6 million was paid to FMSS in FY2012-2013 (where no tender was called) and $27.1 million was paid in FY2013-2015 (where FMSS won the tender as the only vendor that bidded for the tender.)”

Similar lapses were found among several other agencies, two polytechnics — Temasek Polytechnic (TP) and Nanyang Polytechnic (NYP):

  • TP ($40 mil). AGO found lapses in Temasek Polytechnic (TP)’s evaluation of and approval for its investments in bonds. […] AGO noted that for two of the five bonds (totalling $40 million), […] TP’s evaluation relied heavily on inputs sought from a person who had an interest in the company that issued the bonds. With these lapses, there was no assurance that the evaluation was robust. (Source: AGO)
  • NYP ($12.8 mil). AGO found that NYP did not have a proper governance framework to manage transactions with its subsidiary, the Nanyang Polytechnic International Private Limited (NYPi). […] NYP’s practices reflect a disregard for financial controls and proper governance. […] In addition, the provision of generous funding terms, excess funding and hidden subsidies lacked transparency, and also distorted NYPi’s financial state of affairs, making it difficult for the Government to assess the true financial performance and viability of NYPi. (Source: AGO)

The source also argued that “not all audit findings are born equal,” as “many of the non-WP-related audit findings did not have the same consequences” such as “lawsuits” and “potential bankruptcy” as WP’s alleged lapses, citing the following examples:

  • TP ($40 mil – Lapse in related-party transaction). TP informed AGO that it would improve its process and documentation. (Source: AGO)
  • NPARKS ($20.8 mil – Weak grounds for waiving competition). NParks acknowledged that the reasons cited for waiver of competition were not compelling and indicated that it should have called open tenders instead. (Source: AGO)
  • RP ($9.4 mil – Lapse in procurement process). RP informed AGO that it has since revised its procurement processes to ensure compliance with Government procurement rules and documentation of all information pertinent to the evaluation of tender proposals. (Source: AGO)

At the end of the analysis, the source stressed that while “WP leaders should account for and take responsibility for any actions that led to any mismanagement of public monies,” it also questioned as to “why other instances of mismanagement of public monies” appear to “be treated any less seriously,” and why “the custodians of public monies” do not appear to be “as concerned about other instances” of such lapses.

“If these two questions cannot be answered satisfactorily, it then follows to say that the pursuit against WP leaders on these audit issues is an unfair treatment towards opposition party leaders,” concluded the source.

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