Admiralty CCC Chairman resigns over irregularities
Auditor-General (AGO) has just released its report for the Financial Year 2014/15 [Link]. It was submitted to the President Tony Tan on 1 Jul 2015.
AGO conducts its audits on a test check basis. As such, they do not necessary reveal all irregularities and weaknesses. However, they should help to uncover some of the serious lapses.
In the audit of the People’s Association (PA), AGO said that it found instances where training operators were engaged directly by grassroots organisations (GROs) without calling competitive bids. In doing so, there was no assurance that the GROs were able to obtain the most advantageous bids, it said.
“In addition, AGO observed many instances where approvals for award of revenue contracts were obtained from the wrong approving authorities. Consequently, the awards of the contracts were not subject to the scrutiny of the relevant approving authorities. This undermined the role of the approving authorities which is to ensure that the principles of revenue contracting are upheld,” AGO added.
PA is a statutory board which comes under the purview of Minister for Culture, Community and Youth, Lawrence Wong.
Irregularities in Procurement and Payment at a Citizens’ Consultative Committee (CCC)
In particular, AGO’s checks at a CCC revealed lapses in the management of related party transactions and payments. AGO found that a Chairman of the CCC was involved in approving awards of two contracts (totalling $32,000) to a company of which he was a member of the senior management. In addition, in one of the awards, another CCC member involved in the
approval process, was both a director and shareholder of the company. The Chairman also approved payment for a purchase (amounting to $1,500) from another company of which he was both a director and shareholder.
In the above cases, the Chairman and the CCC member did not declare the conflict of interest in these transactions.
“As a result, there was no assurance that the transactions were conducted at arm’s length,” AGO said.
PA informed AGO that the evaluation and award of the contracts was a collective decision made by a Committee. No preferential or additional information was given to the company and it had submitted the lowest quote which was assessed to be value for money.
PA also acknowledged that the Chairman should not have approved the payments. It has checked that there was no irregularity in the payments as the amounts paid tallied with the quotations and the work rendered.
AGO also test checked 41 payments at the said CCC and revealed that there were 7 instances where the Chairman was involved in approving his own claims (totalling $114,767).
“This is a clear conflict of roles as the approver of payments should not be approving his own claims. Furthermore, AGO observed that there was no supporting document for three of the payments,” AGO said.
“Approving payment without any supporting document exposes the CCC to the risk of paying for invalid expenditure.”
PA said that the Chairman had inadvertently approved his own claims. For proper segregation of duties, the CCC would ensure that for reimbursements to the Chairman, the Vice-Chairman and Treasurer would endorse the payment vouchers instead, PA said.
MP for Sembawang GRC Khaw Boon Wan came out to acknowledge that the grassroots leader in question was from Admiralty CCC and that he has stepped down to facilitate a full investigation.
“I am glad that the Investigation Panel found no evidence of dishonesty. Nonetheless, it was a related party transaction that was not declared,” Mr Khaw said in a statement. “The CCC will study the investigation report, and review its procedures to ensure that such lapses do not recur.”
Fellow MP for Sembawang GRC, Vikram Nair said he was saddened to learn of the findings by the AGO and that the grassroots leader concerned has “served with distinction for many years”. The man is giving full cooperation in the investigation, Mr Nair said.
PA’s Official Statement
Later, as media started to carry the news of AGO’s findings, PA further released an official press statement addressing its shortcomings found by AGO. In relation to the errant Admiralty CCC Chairman who committed several “procedural” mistakes, PA said he resigned yesterday (15 Jul):
NON-DECLARATION OF CONFLICT OF INTEREST AND APPROVING OWN CLAIMS AT ONE CCC
The PA rules require all volunteers to declare any conflict of interest. No one can approve payments to themselves. However, there were lapses at one CCC.
As the PA takes a serious view of conflict of interest issues, an Investigation Panel was convened on Jul 1 2015 to establish the facts and investigate any wrongdoing, review the financial and risk management processes and recommend measures to prevent recurrence. The CCC Chairman in question had voluntarily stepped down on Jul 5 to facilitate a full and impartial investigation. The investigation was completed on Jul 14.
The Investigation Panel verified that all quotations for works and services were handled by the staff in a confidential manner. The bids were then submitted to the CCC for evaluation and the tender was awarded to the lowest bidder, which was about 30 per cent lower than the next lowest bid. These tendering procedures were in accordance with the rules.
However, the CCC Chairman and a CCC member were related to the company which submitted the bids, which were also the lowest and winning bids in both cases. According to the rules, the CCC Chairman should have declared his interest and excused himself from the evaluation and approval process. Likewise, although the CCC member did not know beforehand that the bid from his company would be presented at the meeting for approval, he should have excused himself when he realised it.
Regarding approval of own claims, the Panel noted that the amounts claimed by the CCC Chairman were subsequently verified by supporting documents. However, the staff responsible for preparing the payments should have been more conscientious in ensuring compliance with the financial rules by requiring that the Vice-Chairman, Secretary or Treasurer approve the claims instead of the CCC Chairman himself.
While the Panel found no evidence of dishonesty, the non-declaration of conflict of interest is nonetheless a serious lapse. The Panel noted that the Chairman involved has apologised for the lapse and had already stepped down from his position. With the completion of the investigation, PA has since accepted his resignation on July 15. The CCC member has been reminded to comply with proper procedures. Staff involved will be reprimanded.
Under PA, it has a large number of grassroots organisations (GROs) comprising grassroots volunteers. The GROs include the Citizens’ Consultative Committees (CCC), Community Club/Centre Management Committees (CCMC) and Residents’ Committees (RC) and their sub-committees. PA sets the Financial Rules for GROs and provides administrative support to them, among other things.
The relationship between PA and PAP is a close one. The chairman of PA is none other than the PM himself, who is also the Secretary-General of PAP.
The late Lee Kuan Yew once said that the PRCs have been sending teams of officials from China to study Singapore for years. He told of a lesson the Chinese learnt, “They discover that the People’s Action Party has only a small office in Bedok. But everywhere they go, they see the PAP – in the RCs, CCCs and CCs.”
Netizens laughing at Minister Khaw
Blogger The Alternative View [Link] observed:
http://www.tremeritus.com/2015/07/16/admiralty-ccc-chairman-resigns-over-irregularities/
Auditor-General (AGO) has just released its report for the Financial Year 2014/15 [Link]. It was submitted to the President Tony Tan on 1 Jul 2015.
AGO conducts its audits on a test check basis. As such, they do not necessary reveal all irregularities and weaknesses. However, they should help to uncover some of the serious lapses.
In the audit of the People’s Association (PA), AGO said that it found instances where training operators were engaged directly by grassroots organisations (GROs) without calling competitive bids. In doing so, there was no assurance that the GROs were able to obtain the most advantageous bids, it said.
“In addition, AGO observed many instances where approvals for award of revenue contracts were obtained from the wrong approving authorities. Consequently, the awards of the contracts were not subject to the scrutiny of the relevant approving authorities. This undermined the role of the approving authorities which is to ensure that the principles of revenue contracting are upheld,” AGO added.
PA is a statutory board which comes under the purview of Minister for Culture, Community and Youth, Lawrence Wong.
Irregularities in Procurement and Payment at a Citizens’ Consultative Committee (CCC)
In particular, AGO’s checks at a CCC revealed lapses in the management of related party transactions and payments. AGO found that a Chairman of the CCC was involved in approving awards of two contracts (totalling $32,000) to a company of which he was a member of the senior management. In addition, in one of the awards, another CCC member involved in the
approval process, was both a director and shareholder of the company. The Chairman also approved payment for a purchase (amounting to $1,500) from another company of which he was both a director and shareholder.
In the above cases, the Chairman and the CCC member did not declare the conflict of interest in these transactions.
“As a result, there was no assurance that the transactions were conducted at arm’s length,” AGO said.
PA informed AGO that the evaluation and award of the contracts was a collective decision made by a Committee. No preferential or additional information was given to the company and it had submitted the lowest quote which was assessed to be value for money.
PA also acknowledged that the Chairman should not have approved the payments. It has checked that there was no irregularity in the payments as the amounts paid tallied with the quotations and the work rendered.
AGO also test checked 41 payments at the said CCC and revealed that there were 7 instances where the Chairman was involved in approving his own claims (totalling $114,767).
“This is a clear conflict of roles as the approver of payments should not be approving his own claims. Furthermore, AGO observed that there was no supporting document for three of the payments,” AGO said.
“Approving payment without any supporting document exposes the CCC to the risk of paying for invalid expenditure.”
PA said that the Chairman had inadvertently approved his own claims. For proper segregation of duties, the CCC would ensure that for reimbursements to the Chairman, the Vice-Chairman and Treasurer would endorse the payment vouchers instead, PA said.
MP for Sembawang GRC Khaw Boon Wan came out to acknowledge that the grassroots leader in question was from Admiralty CCC and that he has stepped down to facilitate a full investigation.
“I am glad that the Investigation Panel found no evidence of dishonesty. Nonetheless, it was a related party transaction that was not declared,” Mr Khaw said in a statement. “The CCC will study the investigation report, and review its procedures to ensure that such lapses do not recur.”
Fellow MP for Sembawang GRC, Vikram Nair said he was saddened to learn of the findings by the AGO and that the grassroots leader concerned has “served with distinction for many years”. The man is giving full cooperation in the investigation, Mr Nair said.
PA’s Official Statement
Later, as media started to carry the news of AGO’s findings, PA further released an official press statement addressing its shortcomings found by AGO. In relation to the errant Admiralty CCC Chairman who committed several “procedural” mistakes, PA said he resigned yesterday (15 Jul):
NON-DECLARATION OF CONFLICT OF INTEREST AND APPROVING OWN CLAIMS AT ONE CCC
The PA rules require all volunteers to declare any conflict of interest. No one can approve payments to themselves. However, there were lapses at one CCC.
As the PA takes a serious view of conflict of interest issues, an Investigation Panel was convened on Jul 1 2015 to establish the facts and investigate any wrongdoing, review the financial and risk management processes and recommend measures to prevent recurrence. The CCC Chairman in question had voluntarily stepped down on Jul 5 to facilitate a full and impartial investigation. The investigation was completed on Jul 14.
The Investigation Panel verified that all quotations for works and services were handled by the staff in a confidential manner. The bids were then submitted to the CCC for evaluation and the tender was awarded to the lowest bidder, which was about 30 per cent lower than the next lowest bid. These tendering procedures were in accordance with the rules.
However, the CCC Chairman and a CCC member were related to the company which submitted the bids, which were also the lowest and winning bids in both cases. According to the rules, the CCC Chairman should have declared his interest and excused himself from the evaluation and approval process. Likewise, although the CCC member did not know beforehand that the bid from his company would be presented at the meeting for approval, he should have excused himself when he realised it.
Regarding approval of own claims, the Panel noted that the amounts claimed by the CCC Chairman were subsequently verified by supporting documents. However, the staff responsible for preparing the payments should have been more conscientious in ensuring compliance with the financial rules by requiring that the Vice-Chairman, Secretary or Treasurer approve the claims instead of the CCC Chairman himself.
While the Panel found no evidence of dishonesty, the non-declaration of conflict of interest is nonetheless a serious lapse. The Panel noted that the Chairman involved has apologised for the lapse and had already stepped down from his position. With the completion of the investigation, PA has since accepted his resignation on July 15. The CCC member has been reminded to comply with proper procedures. Staff involved will be reprimanded.
Under PA, it has a large number of grassroots organisations (GROs) comprising grassroots volunteers. The GROs include the Citizens’ Consultative Committees (CCC), Community Club/Centre Management Committees (CCMC) and Residents’ Committees (RC) and their sub-committees. PA sets the Financial Rules for GROs and provides administrative support to them, among other things.
The relationship between PA and PAP is a close one. The chairman of PA is none other than the PM himself, who is also the Secretary-General of PAP.
The late Lee Kuan Yew once said that the PRCs have been sending teams of officials from China to study Singapore for years. He told of a lesson the Chinese learnt, “They discover that the People’s Action Party has only a small office in Bedok. But everywhere they go, they see the PAP – in the RCs, CCCs and CCs.”
Netizens laughing at Minister Khaw
Blogger The Alternative View [Link] observed:
http://www.tremeritus.com/2015/07/16/admiralty-ccc-chairman-resigns-over-irregularities/
