SINGAPORE: The contract awarded by the Workers' Party to FM Solutions and Services (FMSS), the former Managing Agent (MA) for the Aljunied-Hougang-Punggol East Town Council (AHPETC), was an “arrangement to reward their supporters and friends”, said National Development Minister Khaw Boon Wan on Sunday (Aug 30).
The arrangement has resulted in a “very sad” outcome for AHPETC residents, as they end up losing money because the town council was “rewarding their friends excessively”, he added.
His comments come a day after the Ministry of National Development (MND) released a press release stating FMSS "grossly profiteering" off the town council.
The MND said the Accounting and Corporate Regulatory Authority (ACRA) conducted an ad-hoc review of FMSS' auditor, Teo Liang Chye and Co. In FY 2013/2014, while AHPETC suffered an operating deficit of S$2 million, FMSS made a net after-tax profit of S$2 million, after paying its directors and shareholders fees and salaries amounting to S$1.14 million, the MND said in a statement on Saturday (Aug 29).
Mr Khaw described the contract as “very rich” and one that was “able to make so much money that it can reward four of the shareholders and directors more than S$3 million a year and still make a profit”.
“So I was surprised to read that Workers' Party finds that there was no over-payment," he said.
He also questioned what’s next for AHPETC, after the opposition party decided to manage the town council internally as no company had put in a bid to be the MA.
"So now they've sacked FMSS, terminated the contract, and do it in house. They need to recruit their own GM and their own secretary. Are they also rewarding them at $3 million a year, since they think S$3 million is fine?” Mr Khaw said.
As for the timing of the MND press release, which was issued at 5pm on Saturday, Mr Khaw said there was "nothing unusual" about it, referring to the sequence of events explained in Saturday’s statement.
The arrangement has resulted in a “very sad” outcome for AHPETC residents, as they end up losing money because the town council was “rewarding their friends excessively”, he added.
His comments come a day after the Ministry of National Development (MND) released a press release stating FMSS "grossly profiteering" off the town council.
The MND said the Accounting and Corporate Regulatory Authority (ACRA) conducted an ad-hoc review of FMSS' auditor, Teo Liang Chye and Co. In FY 2013/2014, while AHPETC suffered an operating deficit of S$2 million, FMSS made a net after-tax profit of S$2 million, after paying its directors and shareholders fees and salaries amounting to S$1.14 million, the MND said in a statement on Saturday (Aug 29).
Mr Khaw described the contract as “very rich” and one that was “able to make so much money that it can reward four of the shareholders and directors more than S$3 million a year and still make a profit”.
“So I was surprised to read that Workers' Party finds that there was no over-payment," he said.
He also questioned what’s next for AHPETC, after the opposition party decided to manage the town council internally as no company had put in a bid to be the MA.
"So now they've sacked FMSS, terminated the contract, and do it in house. They need to recruit their own GM and their own secretary. Are they also rewarding them at $3 million a year, since they think S$3 million is fine?” Mr Khaw said.
As for the timing of the MND press release, which was issued at 5pm on Saturday, Mr Khaw said there was "nothing unusual" about it, referring to the sequence of events explained in Saturday’s statement.
