Several ministries and stat boards taken to task by
AGO
Posted: 24 July 2008 0731 hrs
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Capitol Building
SINGAPORE: Under-utilisation of land and buildings,
resulting in losses from possible rental revenues; "generous"
interpretation of government instruction manuals by the various
agencies to support management action or omissions; statutory
boards taking longer than the recommended timeframe to present
their annual reports and financial statements to Parliament.
These were the three areas of concerns highlighted by the
Auditor-General's Office (AGO) in its annual report, which was
presented to Parliament last week.
While the report took several ministries and statutory boards to
task for coming up short in various areas, Auditor-General Lim Soo
Ping added: "The lapses reported should not be seen as a reflection
of the state of governance of the organisation as a whole. This is
because even in an organisation with good governance and management
practice, lapses do occur occasionally."
Here is a look at some of the findings for Financial Year
2007/2008:
CONTRACT FOR DEBARRED FIRM
An engineering specialist firm was allowed to serve as a
sub-contractor for a project managed by the Ministry of Defence's
procurement agent, the Defence Science and Technology Agency
(DSTA), even though it had been debarred by the Government.
This happened after the DSTA contract was awarded to another
company who had won the contract based on its sub-contractor (the
debarred firm) having the relevant technical expertise and track
record.
The AGO noted that the engineering firm was debarred because it
had, in another DSTA project, bribed employees of the same company.
The case indicated a need to tighten the rules on procurement, said
the AGO.
REMOVAL OF COMPUTER ACCESS RIGHTS
Access rights to computer systems in ministries, state agencies and
statutory boards should be given on a "need" basis to ensure
confidentiality and integrity of systems and data, the AGO report
said.
However, its checks revealed that lapses had occurred in some of
these bodies.
For example, at 12 ministries and four organs of state, 359 users —
who had either resigned, retired or been transferred or had their
duties changed — did not have their existing access rights promptly
removed.
The AGO suggested that these institutions look into effective ways
of ensuring "prompt removal of access rights when no longer
required".
RENTAL ARREARS FOR STATE PROPERTY
The Singapore Land Authority (SLA) serves as the Government's agent
for the administration and management of state properties.
The AGO's checks on some of these properties revealed five cases of
long delay — ranging from one to six years — in repossessing
premises after tenants had defaulted on the rental payments. As of
Aug 31 last year, the rental arrears were $4.14 million.
In one case, after the tenancy agreement lapsed, the tenant
continued to occupy the premises for about six years, defaulting on
its rental payments in the last year of occupation.
The SLA had accepted the AGO's recommendations to refine its
existing procedures in repossessing premises.
LEAVING BUILDINGS VACANT
The AGO report singled out several state-owned buildings that were
left vacant for several years, resulting in foregone rental revenue
running into hundreds of thousands of dollars.
For example, Capitol Building was allocated to the Ministry of
Trade and Industry for use as a performing arts venue. However,
after spending $1.51 million over seven years on feasibility
studies, maintenance and reinstatement works, the Singapore Tourism
Board found that it was not a viable project. The building was
returned to the SLA last year — resulting in over $280,000 loss in
possible rental revenue each year.
In another instance, the former Catholic High School building was
handed over to the Ministry of Information, Communications and the
Arts in September 2000 for development as an art gallery for local
artists.
However, the plan did not materialise and the building was
eventually returned to the SLA in March this year. Some $420,000 in
possible rental revenue annually had been forgone as a result of
leaving the building vacant for over seven years.
STILL NOT SETTLED AFTER 28 YEARS
In December 1979, the Insolvency and Public Trustee's Office (IPTO)
was appointed to handle the liquidation of a co-operative society.
Twenty-eight years on, the process had yet to be completed.
The AGO report also noted that there were 200 ex-members of the
society who had not been paid dividends with accrued interest in
1996. It was only in 2005 that the IPTO managed to locate and pay
64 of them.
The IPTO, which hopes to clear the backlog of 136 unpaid ex-members
by August, has assured the AGO that it had taken steps to improve
its system of administering cases.
GENEROUS ADVANCE FOR PARTNERS
The Workforce Development Agency (WDA) provided its programme
partners with funds "well ahead of need", said the AGO.
For example, between March and December 2006, the WDA issued grants
worth a total of $25.51 million for six programmes. By the end of
last October, $16.02 million had remained unused.
The AGO noted that giving out the grants much earlier than needed
carried "an opportunity cost of interest lost".
The WDA told the AGO that it had since recovered the surplus grants
(including interest) from its partners whose programmes had been
scaled down. The agency had also revised its criteria for
disbursement of grants.
IRREGULARITIES IN CONTRACTS
Between April 2002 and January 2006, the Singapore Discovery Centre
(SDC) awarded 14 contracts worth $15 million to a certain
contractor and another company with the same executive
director-cum-major shareholder.
The figure accounted for 92.4 per cent of the value of contracts
related to the redevelopment of the Discovery Centre. An AGO
investigation revealed "many serious irregularities" related to the
14 contracts. The matter was referred to the police for further
investigation.
The SDC has since introduced a number of measures to ensure the
"rigour and integrity of its procurement and payment
processes".