SINGAPORE — In the recently released Auditor-General’s Office (AGO) audit report for the financial year 2022/2023, it was revealed that there were significant lapses in disbursement controls and procurement practices in several public agencies in Singapore.
The report also highlighted issues related to four key COVID-19 grants, namely the Jobs Support Scheme, Rental Relief Framework, Rental Support Scheme, and the SingapoRediscovers Vouchers scheme.
A comprehensive audit was conducted on the financial statements of all 16 government ministries, eight organs of state, four government funds, eight statutory boards, four government-owned companies, and two other accounts.
Furthermore, selective audits were also performed on four statutory boards and four government funds whose financial statements are not audited by the AGO.
Inappropriate Money Management at Grassroots Organisations
In its sampled audit of 17 tenders between 1 April 2019 and 31 May 2022, the AGO discovered weaknesses in controls at the People’s Association (PA), which manifested in lapses in procurement and instances of inappropriate money management.
This included three tenders that were incorrectly assessed or could not be substantiated. Additionally, there were three grassroots organisations that had violated regulations by awarding or renewing contracts with two debarred contractors.
The audit report noted the improper handling of welfare assistance funds by two grassroots organisations.
Money, totalling to S$707,000 and S$334,500 respectively, was transferred to personal bank accounts of staff members from these organisations. Although the AGO did not find evidence of loss or misappropriation, such practices were deemed to pose significant risk.
Responding to the report, the PA acknowledged the findings and committed to implementing structural changes and projects to bolster governance, procurement, and oversight processes.
This includes the introduction of digital payment functions for welfare assistance disbursements and the creation of field governance offices to enhance compliance.
Over-disbursement of Grants by CAAS
The Civil Aviation Authority of Singapore (CAAS) was identified in the report as having over-disbursed grants by S$1 million, revealing deficiencies in the checks and controls for ensuring grant compliance.
The disbursements were erroneously claimed by companies that included ineligible employees and non-qualifying amounts in their grant claims.
In response, CAAS has committed to tightening its control processes for future grant disbursements and to recover the over-disbursed amounts.
COVID-19 Related Grants
The government’s expenditure on COVID-19 amounted to S$72.3 billion for the fiscal years 2020/21 and 2021/22. The AGO carried out audits on this spending in two parts, the latter of which was concerned with four key COVID-19 grant schemes. The expenditure subject to the AGO’s audits totalled S$33.2 billion.
In general, the AGO found that the Ministry of Finance (MOF), Inland Revenue Authority of Singapore (IRAS), and Singapore Tourism Board (STB) had adequately designed their schemes and instituted key controls across various grant stages.
Nevertheless, there were areas identified for improvements, such as the documentation of key considerations, risk assessments, and approvals of risk scenarios, as well as the need for role segregation between evaluator and approver for certain decisions in one scheme.
Concerns were also raised about the SingapoRediscovers Vouchers scheme, with the AGO finding that some merchants were accepted into the scheme without sufficient proof that they met the required eligibility criterion on tourist visitorship. This led to a total disbursement of S$17.84 million to these merchants.
In response, STB acknowledged the need for a more systematic and accurately documented evaluation of merchant and product eligibility.
It pledged to leverage technology and digital tools for better documentation of evaluation findings and eligibility checks in future schemes.
Recommendations by AGO on grants
Underscoring the government’s challenging task of rapidly developing and implementing new grant schemes during the COVID-19 pandemic, AGO has recommended several key areas for improvement.
First, the identification and documentation of key risks during rapid implementation of grant schemes is crucial. Despite a different risk appetite in crisis, early risk assessment and documentation are necessary for informed decisions and effective governance.
Second, maintaining good governance of scripts and datasets is key. Agencies like IRAS and STB have relied on data analytics for administering large sums.
As the COVID-19 situation evolved, these scripts and datasets were updated. AGO emphasized the importance of version control and proper authorization to prevent errors or omissions.
Finally, the report emphasized the importance of improved documentation and communication. Given the multiple public agencies involved in the design and implementation of the various COVID-19 grant schemes, clear documentation of eligibility criteria and rules is crucial.
Terms and conditions for the grants should be clearly articulated, including the government’s rights to recover any erroneous payment, to safeguard government interest.
The AGO also urged for thorough documentation of key decisions, such as changes to scheme parameters and evaluation of appeals, to ensure transparency and accountability.
