SINGAPORE — Desmond Lee, the Minister of National Development has directed the POFMA Office to issue Correction Directions to Yeoh Lam Keong and The Online Citizen Asia (TOC) over alleged false and misleading statements regarding Housing Development Board (HDB)’s deficits and Singapore’s Past Reserves.
Mr Yeoh, who is the former Chief Economist of GIC — Singapore’s sovereign wealth fund, had published two Facebook posts on 4 October, referring to the reply made by Minister Lee to Constituency Member of Parliament, Mr Leong Mun Wai’s Parliamentary Question.
Mr Leong had asked for the HDB’s net loss for the Central Weave BTO project at Ang Mo Kio; cost of land paid by HDB to SLA for this project; and net profit and loss position for the Government, including HDB and SLA, for this project.
Mr Lee said that the estimated development loss of about S$250 million for the project would increase to about S$270 million after considering the Central Provident Fund (CPF) housing grants given to eligible buyers.
In his Facebook post, Mr Yeoh wrote, “A rather disingenuous and misleading analysis of the supposed $270mn loss made by HDB and by inference the government in developing BTO flats in AMK imho.”
TOC subsequently reported on the post on the same day.
The Minister claims that Mr Yeoh’s Facebook posts had falsely convey the message of HDB not incurring a loss of about $270 million from the Central Weave @ AMK Build-To-Order (BTO) Project and that the Government is free to sell State land at nominal or much lower cost than its fair market value.
In regards to the HDB’s loss, the Minister in his correction directions states that the losses incurred by HDB are accurate and real.
He states that for the Central Weave @ AMK project, HDB will incur an estimated development loss of about $250 million, or about $270 million after taking into account housing grants.
It is also stated that HDB’s deficits are covered using funding from the annual Budget, which is raised from taxes and other revenue streams.
As for the sale of State land, Mr Lee wrote that the State land is part of Singapore’s Past Reserves. The Government cannot sell State land at nominal or much lower
cost than its fair market value without the President’s approval, as doing so
would constitute a draw on Past Reserves.
“Past Reserves are protected by the Constitution for the benefit of future generations and use during crisis. The President’s concurrence is needed before the Government can draw on Past Reserves.”
It is also claimed by the Minister that another TOC article, headlined “Singapore’s reserves substantially profits from $500m land sales in AMK BTO”, falsely conveys that the Government’s sale of land to HDB for the AMK BTO project will lead to an increase in Singapore’s reserves.
Mr Lee in his basis for the Correction Direction, wrote:
“State land is part of the Past Reserves. When State land is disposed of at fair market
value, there is no addition to the Past Reserves but a conversion of one type of asset
(land) to another (cash). For the Central Weave Build-to-Order project, HDB will pay
the Government fair market value for the land, estimated to be about $500 million.
This money will be paid into the Past Reserves, but will not result in a net increase
to the Past Reserves.”
In the POFMA Office’s press release, the following were also noted:
- Past Reserves are protected by the Constitution for the benefit of current and future generations. The President’s concurrence is needed before the Government can draw on Past Reserves.
- Past Reserves are invested, and the Government can use part of the investment income to meet Singapore’s needs.
- This income is currently our biggest single source of revenue, exceeding the revenue from personal income taxes, corporate income taxes, or GST. Past Reserves are also an emergency fund for use during crises, for example in managing the impact of the COVID-19 pandemic.
- If the Government arbitrarily prices the land below its fair market value, such as at the historical price that past Governments had paid to acquire the land, or at just a nominal $1, then it is not putting back fully what it has taken out from Past Reserves. This is equivalent to drawing down the Reserves and short-changing future generations, depriving them of their nest-egg.
- To consume Past Reserves at the expense of Singapore’s future generations and security is populist and irresponsible. Our Constitution is designed to try to stop any Government from this kind of behaviour.
The POFMA Office also states that there is an established process to determine the fair market value of land. It says that the Chief Valuer, a public officer whose appointment requires the President’s concurrence, determines independently the fair market value using well-accepted and established valuation principles and that these are the same valuation principles adopted by professional valuers in the private sector.
“The current fair market value of land is not the same as the historical cost incurred to acquire the land, as the market value of land is influenced by factors such as the current planned land use.”
It emphasises that neither the Government nor the Past Reserves profit from land sales.
Both parties will be required to insert a notice by 7.30am on Saturday (15 Oct) against their original posts or articles, with a link to the Singapore Government’s clarification.
An earlier Correction Direction was issued to The Alternative View (TAV) last month (3 Sep) after it published a Facebook post suggesting that HDB had profited from the sale of the AMK BTO flats in the Central Weave project.
