Indranee Rajah: CPIB investigations did not reveal any connection with a government agency or contract where corruption by ST Marine occurred so the company is not debarred from govt contracts

Debarment from participating in government contracts is a separate and distinct exercise from the court proceedings and serve a different purpose, says Second Minister for Finance Indranee Rajah.

Responding to questions posed by MP Pritam Singh on the debarment procedure, Ms Indranee said that the Court will deal with the adjudication of liability and implementation of penalties for breaches of the law such as corruption. However, the process of debarment is an ‘administrative procedure by the government’ to protect the interest of the government as a service buyer against those who have caused direct harm or losses to the government.

She stressed, “There must be a nexus to government related contracts before debarment can be applied.” This echoes the statement the made by the Ministry of Home Affairs (MHA) to the Straits Times in response to queries about why they had awarded a high-value tender to company whose executives had been convicted of corruption two years ago.

The ST Marine graft scandal, which broke in 2014, is the biggest in Singapore thus far involving the cover up and accepting of bribes of up to S$24.9 million between the years 2000 and 2011. Former ST Marine Group Financial Controller Ong Teck Liam and six other former senior executives of ST Marine were convicted of corruption, the last of whom was sentenced in 2017.

Questions were raised as to why ST Marine was never debarred from GeBiz, the government’s procurement portal, which would have disallowed them from bidding on any public sector contracts.

Speaking directly about the case of ST Marine which was awarded the hefty S$316 million contract in 2018 for the construction and maintenance of at least 12 aluminium hulled patrol boats for the Police Coast Guard for a period of at least 15 years, Ms Indranee said the CPIB investigations did not reveal any connection with a government agency or contract where corruption occurred. Therefore, the circumstances in which debarment can be recommended under the policy parameters did not arise.

In her response in Parliament on Monday, Ms Indranee also noted the charges and convictions were against individuals, not the company as a whole, and that it happened a long time ago.

She said, “In this case, the charges and convictions were against individuals involved, namely ST Marines former group financial controller and six other former senior execs. They were convicted in 2017 for offences committed in the period between 2000 and 2011, the most recent act being 8 years ago.”

Addressing the lapse in notice of award – which TOC reported on previously and which received no real response from the MHA directly – Ms Indranee said that the notice of award was indeed published within 72 days of the tender award, in accordance with regulation.

We had reported previously that other suppliers who had bid on the same tender were only notified over 120 days after the tender was awarded, well beyond the required 72 days period. They only knew of the award to ST Marine after receiving an automated email in November 2018 telling them that the bidding period had ended and that the contract had been awarded in July 2018.

Countering that, Ms Indranee said that the contract was actually awarded on 26 November 2018 and a notice of award was published on the government’s procurement portal GeBiz the very next day, 27 November 2018. She added, “The date of award of tender was initially incorrectly shown as 27 July 2018 and this has been rectified.”

Following up on Ms Indranee’s response, Mr Pritam then asked if the SCOD would start taking into account past private sector corruption convictions when considering debarment in order to protect the government’s interest since it is reasonable to assume that companies with past private sector corruption convictions would expose the government to risk should they take on a public sector contracts.

Ms Indranee said that in order to protect against risk, there is already a process in place where government agencies take into account the tender assessment holistically, assessing the risk of performance, integrity to the contract, or reputational risk.

So basically, the SCOD will not take into start considering private sector corruption convictions for when it comes to possible debarment since the holistic assessment already covers that aspect of risk assessment.

If that’s the case, couldn’t the same sort of holistic assessment be applied to companies which have been convicted of corruption in relation to public contracts? Why the double standard?

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