Thursday, 13 November 2014

Town Council debacle: That sinking feeling.

Just a quick answer to Bertha Henson's question about whether the 70% of residents in AHPETC mind paying for the rest of the 30% of residents? No.

I am not an expert where mathematical sums are concerned, but I do know that the assessment of the strength of an entity encompasses more than just looking at its surpluses and deficits. For example, some entities hoard a lot of surpluses, but this could be because they are underspending in key areas.

I think Singaporeans may want to ponder this: where Town Councils are concerned, does a high surplus indicate a well-run Town Council with satisfied residents? And what could be the causes of a Town Council falling into deficit?

Well, as the group Fabrications About the PAP has helpfully informed us, Aljunied GRC had a surplus of $3.3 million in 2011. So, if surpluses are indeed indicative of good Town Council management as the group claims, why then did the majority of its residents vote for the Workers' Party? (PAP apologists: That's because they're dumb! They don't know better! They are repenting now!) Whatever.

Similar mocking posts are available at FLOP and on Calvin Cheng's Facebook page. The blog Five Stars and a Moon, which tends to publish one-sided blog posts, has also called for the WP to be more accountable in its accounting practices.

But I must say, this is one instance where I agree with Five Stars and a Moon. Although it doesn't bother me that the WP-run Town Council has failed to collect arrears (a common problem for government agencies), when I looked through its Annual Report of 2012/2013 (cos the 2014 one isn't available), I was concerned to note the various areas where the explanations were dodgy.

I have no answer for why the report was so iffy, and since WP is characteristically keeping mum on the issue, I can only offer some ideas based on what I have read from various local sources. My tone will probably sound apologetic to some, but at least the information here is based on facts with links provided for your reference, rather than fabrications and baseless insinuations.

1. What happened to the surplus of $3.3 million that Aljunied GRC had accumulated?

This issue could be explained by studying the amendment to the Town Council Act in 1996 that led to the creation of the sinking funds for all Town Councils. The amendment to the law was ostensibly passed to ensure that Town Councils would have to set aside a third of their surpluses every financial year, so that they could pay for future liabilities (like improvement works in the constituency). Further, it is stated in this article from the Nanyang Business School at NTU that "all accumulated surpluses be set aside in the sinking fund if a new MP from a different party were elected".

Maybe that explains why the surplus of Aljunied GRC disappeared after the General Elections of 2011? If so, then the people behind Fabrications About the PAP could be trying to mislead readers by alleging that the surplus had been misused by WP (in the post pictured: "surplus been used to fill the hole in Hougang") even though they knew that the money had to go into the sinking fund.

Or maybe the Nanyang Business School is wrong? I'll leave it to the real journalists to pore through the Constitution.

2. Why are the Opposition Town Councils always in the red?

After adding up the electorate figures for each of the constituencies, I discovered that AHPETC is the Town Council in Singapore that's serving the most number of adult Singaporeans (202,336 of its residents are Singaporeans above 21). I couldn't find the stats on the children population and the non-Singaporean population, but the electorate stats should give us a good gauge of the enormity of the task they are facing.

The GRC with the second highest number of Singaporeans above 21 is Pasir Ris-Punggol, with 196,350 citizens.

Then, I went to have a look at the section for "government grants" in their Annual Reports. To be fair, I compared the Annual Reports of 2012/2013. Even though Pasir Ris-Punggol has already made available the 2014 version, AHPETC doesn't have it yet. (Andrew Loh of TOC has pointed out in this insightful article that Punggol East SMC was not under WP in FY 2012/2013. Thus, the electorate that Hougang-Aljunied GRC was serving then was minus 34,000 people - the approximate electorate size of Punggol East.)

Anyway, I noticed that Pasir Ris-Punggol, despite having to serve the smaller population of adult Singaporeans, received $1.5 million more in government grants than AHPETC ($8.8 million minus $7.3 million = $1.5 million). Numbers are rounded off to the nearest ten thousand.

Maybe Pasir Ris-Punggol has more areas that need government grants...

Tanjong Pagar GRC has an electorate of 137,464. That's 64,872 fewer adult Singaporeans than AHPETC. However, it received $13.5 million in government grants in FY 2012/2013. That's $6.2 million more than the grants received by AHPETC.

Perhaps it's because Tanjong Pagar GRC has a greater need for repairs and infrastructural modifications than AHPETC. Indeed, the GRC, where I used to live, has a great need for handicap and elder-friendly facilities.

Well, I don't want to find excuses for WP, so I'll end the post here and leave you to judge for yourselves. I am simply placing this information here in the hope that the matter of AHPETC's deficits can be discussed in a rational manner, without the usual mud-slinging directed at the Opposition, egged on by deliberate misinformation from pro-PAP groups. While the final balance of accounts is important, we should also try to find out why it came to be that way.

Instead of lamenting the lack of transparency and allowing different partisan groups to hoodwink us, let's look at the information that's available. We can find out a great deal by examining them.

Additional note

It seems that this post has been shared on TOC and TRS. No wonder there are suddenly hundreds of people visiting this blog. Even though no permission was sought from me before the post was copied and pasted, I still want to thank you for sharing.

I have been questioned on FLOP by this person. Well, the author of this blogpost cannot answer your queries on FLOP because some sneaky person on that page has reported my Facebook account and it's been suspended.

Here's my reply: First, I have already suggested where the surplus could have gone. If you cannot be bothered to read to engage my argument, it just reflects badly on you.

Second, what I have stated are only suggestions based on the information I have gathered online, since WP has not given a complete reply. I recognise that you have a different opinion, but it's unreasonable of you to demand proof when you are also unable to prove your view that the WP is guilty of mismanaging the funds.

Third, a deficit could be caused by any number of reasons. The PAP Town Councils and even the Singapore government have had deficits before. Since your guess is as good as mine about how the money was spent, maybe we should just respect each other's opinion and wait for the facts to come to light.


  1. For 1) there's no air-tight argument that AHPETC did indeed set aside all its surpluses by channeling these into the sinking fund. So it's also pretty one-sided in this blog post too.

    2) Are grants given out without Town Council projects being created? i.e. to say: have AHPETC tabled projects and submitted applications for grants for upgrading works to the government?

    I think the questions and doubts could have been phrased and more well-thought through.

    1. Hi Shigure, thank you for the comment! I think the $3.3 million accumulated surplus that Aljunied GRC had under George Yeo should have been transferred to the sinking fund. It is likely that this was done very early on when WP won the election and the transfer might even have been done by the old GRC management before WP took over. $3.3 million is a huge sum of money, so if it wasn't transferred, then my question would be, how come the G did not say anything about it? However, AHPETC does owe the sinking fund money as it failed to transfer money collected from the services and conservancy fees to the fund in FY2012/2013. Your second point is a fair point. This is something that AHPETC should clarify. I could only find this article No idea if the 17 proposals were eventually accepted. To put things in perspective, it should also be noted that the Potong Pasir SMC held by Chiam See Tong achieved a surplus in FY 2010/2011. So the criticism of WP, therefore, is why Chiam See Tong could achieve a surplus but Low Thia Khiang cannot? :/

  2. Hi, I think when looking at the gov't grant, one must realise that it is split into three components: contributions to sinking fund; paying for approved improvement projects (e.g. installation of lifts that stop on every floor) and defraying of operating costs.

    In the respect of the grant for defraying operating cost (which is the key issue, since the debate was over AHPETC's operating deficit, the gov't grant has not decreased and has actually increased from when PAP held Aljunied. In 2010/11 (PAP), it was $3.8 million; in 2011/12 (WP), it was $4.8 million; in 2012/13 (WP), it was $4.9 million.

    However, the operating surplus changed like so: 2010/11 (PAP), $3.3 million 2011/12 (WP), $1.1 million; 2012/13, deficit of $734k. In that sense WP is quite consistent in "eating up" the operating surplus to the tune of about $2 million a year. This can be due to over-spending or under-collecting. Pick your poison as their 2013/14 accounts are late and not out yet.

    However, there is a potential case to be made that the contributions for sinking fund and improvement projects has dropped drastically since the PAP days - from $22.9 million in 2010/11 to $2.4 million in 2011/12 and 2012/13. However, that doesn't directly impact the operating surplus and so is a separate point of argument.

    Link to the annual reports here:

    1. Hi coern, thanks for your reply! I think looking at the reports from 2011-2013, it is fair to say that govt grants for the GRC have increased in real terms. Also, that the deficit has increased as well. But comparisons with any numbers before that get a bit problematic, because after WP won Aljunied, it merged Hougang SMC with Aljunied to form Aljunied-Hougang TC. The annual reports published by WP after that are for Aljunied-Hougang, and not just Aljunied. From 2010/11 to 2011/12, it looks like the govt gave $1 million more after Hougang merged. As for whether that's a fair amt, I can't tell without knowledge of the number of households or HDB blocks. I agree with you, though, abt the possible causes of the deficit. Undercollecting looks like a confirmed cause as the arrears percentage is high. Waiting to see how WP explains this. They better have a good reason for the deficit.

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