Public accounts watchdog concerned over lapses in management of land

The weak management of land resources by some ministries was red-flagged by the Public Accounts Committee in a report submitted to Parliament. -- PHOTO: ST FILE
The weak management of land resources by some ministries was red-flagged by the Public Accounts Committee in a report submitted to Parliament. -- PHOTO: ST FILE

SINGAPORE - The weak management of land resources by some ministries was red-flagged by Parliament's public accounts watchdog.

Of particular concern was the under-utilisation of land, buildings and assets, resulting in the waste of public resources.

It was among several areas the Public Accounts Committee highlighted in its 10-page report submitted to Parliament on Wednesday.

The other lapses had to do with the administration of schemes and programmes, procurement and the back-dating of documents.

The committee of eight Members of Parliament had asked for and received written explanations from five ministries.

They are the Ministry of Defence (Mindef), Ministry of National Development (MND), Ministry of Health, Ministry of Manpower and the Ministries of Trade and Industry.

On the issue of land management, the committee had asked Mindef to explain its land licensing agreement with one of its contractors.

This was one of the bigger lapses in the management of assets highlighted by the Auditor-General's Office last year.

The Ministry had rented land to a contractor in 1995 at a nominal rate of $45 a year, to provide services solely to the ministry.

But Mindef did not raise the rent even after the contractor was privatised in 2000 and used the land for commercial activities.

The land was part of a bigger plot leased from the PUB in 1971, at $68 a year.

When the lapse was discovered by the AGO, the ministry was charging the contractor $830,000 a year in rent for the land. It was also paying PUB a revised annual rent of $5.43 million for 127ha.

In it's report, the Public Accounts Committee said: "The committee was concerned that public resources might be used for subsidising commercial activities."

Mindef, in its explanation, said the licence agreement did not have a clause to stop the contractor from doing what it did. That is because the contractor was a wholly Government-owned company before 2000.

After the lapse was discovered, Mindef has since entered into a new rental agreement with the contractor, it added, and would be charging the contractor annual rental for the land that is used for commercial activities.

The ministry will be using the contractor's revenue to gauge how much rent it will charge.

The MND was also questioned by the committee over the under-utilisation of land, buildings, facilities, equipment and machinery by the Agri-Food and Veterinary Authority (AVA).

The committee was concerned it will lead to wastage, it said.

In response the MND said the AVA, a statutory board under the ministry, had since completed a review of how much space, equipment and machinery it needs.

In the review, the AVA had also assessed if it can move some of its activities at its Sembawang site to its Lim Chu Kang site, said MND.

The AVA has since submitted a land return proposal to the Singapore Land Authority over this.

The MND added that AVA had also been reminded to "dispose of unused equipment and machinery in a timely manner to realise any salvage value and to free up storage space".

The committee, in response to Mindef and MND, said: "The committee would like to emphasise that public sector agencies should exercise greater diligence in managing public resources and review their usage regularly so as to optimise their use."