Ms Vase Teo unhappy about MP Png mentioning Govt lapses
In the ensuing AHPETC saga, Hougang MP Png Eng Huat gave his speech in Parliament yesterday (13 Feb).
Mr Png started by saying he has full respect for the work done by AGO, which also audits ministries and organs of states.
“Over the years, the AGO has found sad instances of over payments, payments without evidence that goods and services were delivered, duplicate payments and in one instance amounting to $18.6 million, and etc in many ministries and organs of states it audited,” Mr Png said.
“One agency was found to have called for a quotation instead of a tender for a project that exceeded $70,000 in the 2010/11 AGO report. Another agency was cited to have issued purchase orders… only after the contractor has started the work.”
Mr Png also noted the many lapses AGO had uncovered while auditing the government bodies:
10 statutory boards did not present their FY 2006/07 annual reports to Parliament within the six-month time frame and three of these boards had also been late the previous two year. One of them did not even present its audited financial statements to Parliament for the previous two financial years.
The Ministry of National Development was cited for overpayment, late payment and mistaken use of waiver of competition
The Ministry of Foreign Affairs was cited for not having complied with Government procurement principles of transparency, open and fair competition, and value for money when an overseas mission was audited
The Public Service Division was also flagged for informing a bidder that it had secured a contract worth $455,000 13 days before the Tender Board made the award decision.
“Some of these lapses were small in financial values while others were serious and the list goes on. Like what the ministers said yesterday, in some country, the CEO would take a deep bow, apologise, and resign but I guess this is not in our culture,” Mr Png said in reply to Minister Khaw’s criticism against AHPETC yesterday (12 Feb).
Turning back to AHPETC, Mr Png acknowledged, “AHPETC is also found by AGO to have erred in some of these areas and I am certain AHPETC will not be the last as well because good corporate governance is a work in progress.”
Taking the AGO findings on AHPETC seriously, Mr Png added, “We have acknowledged our shortcomings in certain areas as well as defended our actions in others. On any other given day, this report may read like a typical AGO report on any entity under audit but today the spotlight is on AHPETC and we will explain the issues to the public.”
Mr Png then went on to gave his comments on several issues with regard to the AHPETC saga.
Arrears of Service and Conservancy Charges
With regard to what the AGO report said about AHPETC does not have “a system to monitor arrears of conservancy and services charges accurately and hence there is no assurance that arrears are properly managed”, Mr Png explained that it does have.
However, what AHPETC does not have is a program to generate aggregated S&CC data in the format requested by MND and to monitor them in that specific format. The computer system currently in use at AHPETC was an up-scaled version of the system from Hougang SMC and it was put into operation within a short span of one month. A lot of the features required to handle the operation of a GRC were not implemented then, he explained.
“As we have mentioned in our media release, all reports submitted to MND up to April 2013 were prepared by staff based on data generated by the IT system and extracted through manual sorting and counting. AHPETC also acknowledges that this manual process is not ideal and efficient as the data set is huge. It is also tedious and subject to reporting and human errors,” he said.
“Our system may be rudimentary in features compared to what was available before 2011 but it is certainly robust in keeping a reliable database. We took time to have the data and process reviewed internally and externally before we released our S&CC arrears rate of 5.66 per cent as at 30 September 2014 a few weeks ago. In short, we were not evasive when we said we would address the issue in due course. We will work towards providing timely data to MND in the coming weeks albeit not in the format the ministry required but nonetheless relevant enough to take a snapshot of the arrears situation at AHPETC.”
Difficulties dealing with some government agencies
Mr Png then related some difficulties in dealing with government agencies, for example, like NEA, which comes under Minister Vivian.
In the AGO report, it was stated that NEA rejected four invoices from AHPETC because they were wrongly sent to one of the regional offices. By the time the invoices were received by the relevant division, the period provided for payments or credit period had lapsed and NEA was unable to process the invoices for payment. NEA then requested AHPETC to re-issue the four invoices.
Mr Png emphasized that invoices do not carry expiry dates.
“The 30-day credit term listed on an invoice is to let the debtors know that they have to pay within the stipulated period or the creditors will reserve the right to impose penalties. It is common to replace a missing invoice under the same invoice number and date or to re-issue an invoice due to amendments but to request for new invoices due to expired credit terms is highly unconventional,” explained Mr Png.
“To void an invoice needs justification. Is it right to do that just so an agency can be seen to be prompt in making payments on paper?”
Safeguarding Public Funds
When WP took over Aljunied GRC, PAP’s company AIM, which acquired the town council software earlier, decided not to let WP use it. WP had no choice but to develop its own.
Mr Png commented, “I wish to touch on safeguarding public funds. It is a waste of public funds for an incoming administration (WP) to develop a new computer system that does essentially the same functions as the previous system (acquired by PAP’s company AIM from TC), which was also develop with public funds.”
“I understand in the old days, HDB used to provide town councils with a centralized computer system. It makes perfect sense since town councils are set up to manage only HDB estates and the common areas. Who else would have the latest data on the number of flats in an estate, the types of flats, the residency status of the tenants, the amount of grant each flat should receive, when to start collecting S&CC and whether the unit is rented out whole or partial? All these information affects S&CC and grants,” he said.
“And such systems are not cheap to develop. The old system at Aljunied Town Council cost over $20 million, hardware and software, split among the other PAP town councils. AHPETC has spent over half a million dollars just to replicate what the old system could do and we still have a way to go. Isn’t that a waste of resources and public funds?”
With regard to this matter, Mr Png proposed the setting up of a centralized computer system serving all TCs to safeguard residents’ interest and money.
Mr Png concluded his speech by saying the buck stops at AHPETC.
“I can’t remember if any minister has ordered any audit on any ministry or organ of state in recent times due to disclaimers or adverse opinions expressed by its auditors but nonetheless AHPETC had co-operated in this audit and will take lessons from the findings in the spirit of public accountability and good corporate governance,” he added.
Minister of State Josephine Teo challenges MP Png
After Mr Png finished his speech, Senior Minister of State for Transport and Finance Josephine Teo immediately challenge Mr Png to cite instances where AGO reached the same conclusions in its routine audits of government entities as in its recent audit of AHPETC.
Ms Teo pointed out that the AGO concluded in its AHPETC audit that “unless the weaknesses are addressed, there can be no assurance that AHPETC’s financial statements are accurate and reliable and that public funds are properly spent, accounted for and managed”.
She asked, “I would like to know whether Mr Png is aware of any other occasion that the AGO has drawn the same conclusion for a government ministry or statutory board?”
Mr Png replied that he had not meant to compare the conclusions in the AGO’s AHPETC audit with the ones in its annual audits. What he meant was that “such lapses do exist”, he said.
Ms Teo shot back that he “had suggested that ministries and statutory boards have the same problems”, even though the AGO had drawn a very specific conclusion about AHPETC.
Mr Png said the examples he cited about the lapses by government bodies had been picked up by the AGO.
“Are those not real instances where lapses happened too? I am not saying that because (the) AHPETC (audit) was tabled in Parliament, but I am just citing that AGO work is thorough, fair, and I respect that,” he replied Ms Teo.
So, was Ms Teo correct in defending the lapses by government bodies, as picked up by AGO?
What do you think?
View what readers think of silly Vase Jo Teo's naive response....
http://www.tremeritus.com/2015/02/14/ms-teo-unhappy-about-mp-png-mentioning-govt-lapses/