NEC Asia Pacific has won the tender to develop a new computer system for the 14 town councils run by the People's Action Party, taking over the role that used to be performed by the controversial PAP-owned company, Action Information Management. (AIM)

The Japanese company clinched the seven-year contract for $16.8 million, said Dr Teo Ho Pin, the coordinating chairman for PAP town councils.

NEC was among three companies who submitted bids. The other two companies were HCL Singapore and NCS, a wholly owned subsidiary of the SingTel Group. AIM, which had help draft the terms of the tender, did not bid.

A statement from Dr Teo said NEC was picked based on the recommendation of Deloitte and Touche Enterprise Risk Services, which evaluated the bids.

NEC, among others, had the lowest-priced bid and used the latest technology from Microsoft and Anacle for its system.

"The Town Councils are confident that the new software is a cost-effective solution which will enable them to better serve their residents," Dr Teo said.

The tender comes as the Government reviews the PAP town councils' sale of their software to AIM in 2010, a move criticised for being against public interest.