WP town council case: It began a long time ago...
I feel like I have been taken back in time, to right after the 2011 General Election. That’s when the Workers’ Party (WP) wrested Aljunied GRC from the People’s Action Party. I remember at that time, I actually thought I had gone even further back, to the aftermath of the 1991 General Election, when WP’s Low Thia Khiang took over Hougang.
That’s because old news is coming back to the fore, of the difficulties that opposition faced when it had to run a town council. So old battles are reprised, old wounds re-opened, and we see that the boils have continued to fester.
So the entity that is Aljunied-Hougang Town Council is suing seven people, including three WP MPs, for the return of $33 million which it claims had been wrongfully paid out to its former managing agent and other contractors. It’s got two audit reports to back up its case with a list of lapses as long as your arm.
The audits make it look like the WP was trying to run a provision shop with its kakis, instead of a professional outfit with proper rules and financial processes. It has shades of the National Kidney Foundation saga, which ended up with the new entity bankrupting former executives, also backed up by an auditor’s report.
Over the years, there is the sniff of cronyism and the hint of fraud hanging over the heads of the WP. Yet, despite several mentions, no criminal charge has been brought against anyone in the town council although there were various mentions of breaches of the Companies Act. More recently, the Town Council Act was amended to plug loopholes regarding the duties and liabilities of town councillors.
Accountants and lawyers will probably have a field day dissecting the fine print of the charges and mulling over terms like fiduciary and statutory duties. The laymen will gasp at the dollar amounts and wonder if their service and conservancy charges as well as G grants were put to good use, even if no money had gone into other people’s pockets.
But a town council is not a charity, like the NKF, which is surrounded by a thicket of safeguards over donor’s money. It is a political organisation, run by politicians, who would naturally rope in politically like-minded people to lend them a hand, hopefully, gratis. It has an incentive to prove itself worthy of its electoral mandate and out-perform its political rivals.
The town council’s lawyer Davinder Singh worries about the WP turning the court case into a political soapbox. His worry is well-founded because which opposition party would not portray itself as the injured party driven to circumstances because of shackles placed by a more powerful force? WP’s lawyer Chelva Rajah in fact asserted that the PAP had a track record of making “things difficult for opposition-run town councils”.
So the memory recall machine is put into high gear, with affidavits filed on how, for example, the Housing Board terminated its Essential Maintenance Service Unit contract and computer services for Hougang Town Council, and Mr Low had to find alternatives. Mr Low’s town council also had to leave the premises it occupied within three to four months of notice, and his request for an extension of time was rejected.
The memory machine also kicked out some other episodes like the CPG pull-out of Aljunied TC in 2011. CPG had openly said it was difficult to service an opposition town council when it also had contracts with PAP-led ones. Since the hearing started on Friday, there was this question raised about why CPG wasn’t retained, especially since it was cheaper.
The WP’s response in court was based on its 1991 history – and practical politics. Pre-empting a similar 1991 withdrawal by the HDB, the WP said it made contingency plans involving its old managers in Hougang TC which later became corporatised as FM Solutions and Services. In fact, when it put out a tender after gaining Aljunied GRC, none of the three estate management companies put up a bid.
There was also the embarrassing matter of Action Integrated Management systems (AIM) which the G admitted was a $2 PAP company, handling town council backend work for all the PAP town councils. It pulled out of Aljunied too, leaving WP, or so WP says, having to re-work a system which had to be scaled up from serving a single seat ward to a GRC. It took ages. Hence, lapses.
The AIM saga, circa 2012, is probably an episode that the PAP would rather forget. It could, in fact, be said to be the spark that ignited the today’s flames. Hitting back at that time, the PAP pointed to the tangled web of conflicting interests in the WP town council, and this attack continued with the WP’s failure to secure its auditor’s unqualified green light for its finances almost every year.
Then came the threat to hold back HDB grants, the recourse to the courts, the public accounting of what lapses had been fixed and what had not, and the setting up of an independent panel to supervise the TC, which took out this civil suit now led by Mr Singh, a former PAP MP.
In between, there was a general election in 2016, which resulted in WP losing its single-seat ward of Punggol East and a smaller vote share for Aljunied GRC and Hougang.
What new revelations can we expect from this court case, besides some firm numbers fixed to WP’s list of alleged wrong-doings? One issue is about the classification of projects and whether they should be considered as part of the managing agent’s basic fee coverage or as separate projects to be paid for. That accounts for $1.2m of the sum in contention. An interesting point was raised about how this was the past practice of the previous PAP town council.
This court case is framed as a legal issue of recovering money owed to residents, but no one is under illusions about the ramifications of the result, whether it goes one way or the other. If the WP side manages to defend itself successfully, then there will be a fuss about how this rigmarole which was several years in the making is a colossal waste of everybody’s time. There will be plenty of red faces on the PAP side.
If it goes the other way, I doubt that the seven people named as plaintiffs have deep enough pockets to pay large sums if the verdict goes against them. Mr Low might well have cause to repeat his line about being “sued till pants drop”. Bankruptcy would disqualify the three MPs from standing for re-election.
I believe the laymen would view this as political persecution even if it is really legal prosecution. You can prevent the spread of fake news but not people’s perception of real news.
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