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MND looks to better protect public funds held by town councils

Results of the MND's Town Council Management Report ending March 2013. (Screengrab from MND's Town Council report website)

The Ministry of National Development is looking for ways to better protect public funds, its minister Khaw Boon Wan said on Monday.
 
Speaking in Parliament ahead of the commencement of the Budget 2014 debates, Khaw said the existing Town Councils Act was drawn up to provide enough freedom for Members of Parliament (MPs) to run the estates of their constituents.
 
“While residents can hold their TCs to account in areas such as cleanliness and maintenance of the estate, it is difficult for (them) to exercise effective oversight in other areas of TC operations, such as financial management,” he said in response to Chua Chu Kang GRC MP Alvin Yeo.
 
Yeo had asked about the measures available to protect the interests of residents when Town Councils fail to observe good corporate governance and responsible accounting practices.
 
Khaw noted that “should the TC fail to maintain the estate properly or if there is a need to remove any imminent danger to residents”, he can intervene and appoint another party to perform the council’s duties.
 
“TCs are entrusted to deliver essential municipal services and manage large sums of public monies,” said Khaw, who noted that the actions of officials who work in town councils are subject to existing laws of the land that lie beyond the Town Councils Act.
 
“Criminal and civil liabilities apply when their actions amount to transgressions of such laws,” he added.

Yeo's question on town council accountability likely stems from an ongoing controversy over town council accounting, after the Workers' Party (WP)-run Aljunied-Hougang-Punggol East Town Council obtained red grades in the Ministry's latest town council management report last November.

It triggered a tit-for-tat between the Ministry and the WP when AHPETC received a "disclaimer of opinion" on its financial statements for the financial year 2012. The Town Council attributed it to "information gaps" that existed from the handover from the People's Action Party after the 2011 general election, when WP took over.