The AIM of serving the public’s interests

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Looks like the CPIB did the trick. More accurately, the mention of the “CPIB” did the trick.

The childish bickering between the People’s Action Party (PAP) and the Workers’ Party (WP) was becoming a national embarrassment. It was not unlike quarrelling children at a playground pointing fingers and making funny faces at each other.

So, it was good that Ms Lim stopped the unbecoming behaviour in its aimless track when she challenged the PAP to report the WP to the CPIB for any transgressions the PAP might think the WP was guilty of. The PAP has since not said a word in reply. In fact, the PAP has not responded at all.

Good.

Now, let’s get back to the main issue here.

The Action Information Management (AIM) saga is about a conflict of interests. This, above everything else, is the crux of the matter which the People’s Action Party (PAP) seems to have avoided confronting, and which the Workers’ Party (WP) is also ostensibly guilty of in its own transaction.

The actions of the two political parties in the matter leave much to be desired.

The WP should have, on hindsight, exhausted all avenues before awarding the initial contract to a newly-set up company (4 days after the results of the elections) owned by apparently devoted WP supporters. This seems to be the main bone of contention as far as WP’s case is concerned. No matter how the party tries to explain it, more care should have been taken before it awarded a multi-million dollar contract to close affiliates or friends/supporters of the party. The WP should not pretend that this does not matter, or that it has done its due diligence. It apparently could have done more – for example, in seeking an extension from AIM for its services in the first year; or to approach the Ministry for National Development for a similar extension of the town council handover deadline, to enable the party to exhaust all avenues in looking for a vendor.

Additionally, the WP also failed to be upfront about the owners of FMSS and their party affiliations from the beginning.

Having said that, one also understands the constraints the WP faced. To put it bluntly, it is not an easy thing to find businesses or service providers which would align themselves or be seen to “help” any opposition party in any way. It is this reality which probably prompted the WP to do what it did, sincerely believing that it was serving the public’s interests by engaging a newly set-up company but one which was run by experienced Hougang town council councillors who also happen to be WP supporters. The party also said it had to work within time constraints.

This is perhaps why it is the PAP/AIM transaction which deserves the more severe criticism and scrutiny with regards to how the contract was awarded to AIM.

Why is this so?

There are three main issues here which we should not lose sight of:

1. Profits from AIM go into PAP, the political party
2. The inclusion of the one-month notice of termination of service clause
3. Conflict of interests in review of AIM transaction

Profits from AIM

The simple fact of the matter is this: a contract was awarded by 14 PAP-run town councils to a PAP-owned company – a company, mind you, which for 22 years no one knew existed.

Here is the sting: any profits made from such transactions with AIM would go directly into PAP coffers, since AIM is a PAP company, unlike the WP case where any profits do not go into the party’s accounts since the management agency involved, FMSS, is not a WP-owned company.

While “AIM did not make a profit from the TCMS transaction in 2010 [and] its directors were not paid any fees and it charged only a fee to cover its operational costs”, this really is beside the point.

The issue here is that a political party – in fact any political party which owns such a private company providing such services – can benefit politically from such deals. If AIM had made a profit, or had paid its directors, the point would be more stark, and the public outcry would be more devastating to the party.

Imagine if AIM had made millions in profits which then go directly into the PAP’s account.

Residents who do not support the PAP (opposition supporters, for example) would in fact inadvertently (since they would not and did not know that AIM existed, or that AIM is a PAP company) be supporting the PAP financially.

Residents pay the town councils for their towns to be run efficiently. They did not do so to financially benefit the political party running the town.

This point is further exacerbated by what Mr Khaw Boon Wan said in Parliament – that AIM is “not an ordinary S$2 company”.

“The party was standing behind (AIM), effectively guaranteeing its performance,” Mr Khaw said. “If the town councils do not perform, it will reflect on the MPs and affect their future election prospects.”

How the PAP does in future elections is a moot point. The question is the justification for giving a contract worth millions of dollars to a “S$2 company” whose only legitimacy, according to Khaw, is that the PAP “was standing behind” it, “effectively guaranteeing its performance”.

In fact, by saying that the main reason why AIM was awarded the contract – worth millions of dollars – was because the PAP was guaranteeing its performance exactly proves the point of potential abuse of such a system.

Contracts can be given not based on ability or capability or track record, but by a simple and rather subjective “guarantee”, whatever that means or entails.

Such contracts can also apparently be given to a company which has no physical offices, no computer hardware, no staff, no mailing address of its own, no websites, and whose directors have apparently limited experience in running town councils.

In other words, it is effectively a shell company.

One-month termination clause

The AIM contract with the PAP town councils includes a clause which allows the company to terminate its services with any town councils by giving a month’s notice, in the event of “material changes to the town council’s membership or scope and duties.”

The clause is a highly questionable one, as Ms Lim highlighted:

“Is a one-month termination reasonable for a critical IT system? It is quite clear that time is needed to develop a system of this complexity – in the PAP’s own estimation, 18 to 24 months. Did the PAP TCs not realize that this aspect of the AIM transaction endangered the continuity of public services? Or perhaps that was the intention in the case of a change in political leadership?”

“It was fortunate indeed that the WP could use the IT system in place in Hougang TC and upscale it within a much-abridged time to cater for a town of GRC magnitude. What if a constituency was won by a political party not running any TC, or by an independent candidate? Or is the continuity of public services not important to the PAP once they lose a constituency?”

The PAP’s comeback is a weak one, defending the presence of the clause as “reasonable”, and avoiding Ms Lim’s questions which go to the very heart of the role of town councils – to serve the public’s interests.

The clause, in fact, appears to be installed for partisan political expediency, in the event another (opposition) party takes over the town. In other words, because the computer system takes a long time to develop and set up, any termination of the existing service will present the new party with not an insignificant (political) problem.

Conflict of interests

And to compound the entire sorry saga further, the ministry tasked to oversee the review is headed by the minister who is also the chairman of the PAP, the same PAP which owns AIM, the company at the centre of the entire matter.

So, right from the start of the review, questions of potential bias – perceived or otherwise – already emerged, raising doubts about the independence of the review itself.

Are we to expect the chairman of the PAP to stand up in Parliament and castigate his own party for any transgressions by a company owned by his party?

When Mr Khaw spoke in Parliament, was he speaking as minister of the ministry or as chairman of the PAP? How are the two distinguishable? At which moment was he wearing the minister hat, and when was he wearing the PAP chairman hat, if at all?

If the public is to maintain trust in the system, there should be a review of both the AIM and the FMSS transactions. The probe should be carried out by an independent committee which is also given powers to summon any documents, persons, and information it requires or wants from any party involved in the two cases.

There have been much chest-thumping from both the PAP and WP about serving the “public interest”. Accordingly then, perhaps we should start by making sure the probe into the AIM transaction is not tainted by a potentially biased review committee, and carried out by parties with vested interest in its outcome. It is curious that the WP did not object to the review being headed by MND, or call for an independent enquiry.

If the public’s interests are to be served, then let’s do a proper job of it. For now, after a review and a prolonged childish spat, we are nowhere near resolving the main issues here.

In the meantime, it is good that the Government is conducting “a comprehensive review of the legislation governing all town councils in Singapore.” At the core of its review should be the question of ensuring and preserving good governance vis a vis the town councils.

The public’s interests, indeed, calls for nothing less.

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5 thoughts on “The AIM of serving the public’s interests

  1. I propose all Minister and MP and their direct relatives to declare any / all business interests with town councils,govt agencies, and categorically list the revenue and contracts.

    Also all the PA, RC, CC members to declare the same. The public can then see the issues more clearly.

    If you want to see more, all MP should declare business interests in helping foreigners to setup busineess, home or immigration im singapore. You will be surprised how many actually profits from the open-tap foreigners policy

  2. The need for the one-month termination clause completely contradicts the PAP’s own argument that “The party was standing behind (AIM), effectively guaranteeing its performance,” Mr Khaw said. “If the town councils do not perform, it will reflect on the MPs and affect their future election prospects.”

  3. Good article, Andrew.

    Let me throw in a potentially even more explosive spanner: How do we know whether AIM has not since then leased the same software, or subset of it, to other organisations here and elsewhere in the world, esp. the less developed world in Asia and Africa?

    It can’t be too difficult to clone copies of it or use it as platform to create software to suit other purposes. Remember, that copying even part of the codes is a copyright infringement. Do you know whether the TC-AIM contract ties the hands of AIM in these respect or is silent on this? Technically, since AIM now owns the software there is nothing to stop it from doing so benefiting from something developed with public funds.

    Not hard to imagine AIM operating in the international arena with stuffs acquired in this manner from the govt and even statutory bodies. How can we check or be assured that such deals do not exist? That’s how I see the potential flow of funds to the PAP to support its many activities and hangers-on.

    One more reason, the PAP wouldn’t take up WP’s challenge to take it to the CPIB for it would be too close for comfort. Who knows what can of worms the corrupt practice guys would be able to dig up?

  4. “Additionally, the WP also failed to be upfront about the owners of FMSS and their party affiliations from the beginning”

    Not true, someone posted a article dated 6 Aug 2011, where Sylvia explained the background of FMSS and the need to do a tender waiver on Teo H P facebook. It was quickly taken down and the person who posted the article even pointed out this selective censorship in another post.

  5. /// The WP should have, on hindsight, exhausted all avenues before awarding the initial contract to a newly-set up company (4 days after the results of the elections) owned by apparently devoted WP supporters. ///

    I thought with backsight, you should know that it is impossible to have any other companies to do the job. Which companies would have the necessary track record of running town councils other than the current ones which are running PAP constituencies? Would any neutral companies want to take on a one GRC business and run the risk of antagonizing the party that controls the other constituencies?

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