SINGAPORE - All 16 town councils submitted clean accounts this year to the Ministry of National Development (MND), including the Aljunied-Hougang Town Council run by the Workers' Party which did so for the first time in eight years.

This was disclosed by the ministry on Thursday (Dec 5) as it released the latest Town Council Management Report for the period of April 2018 to March this year.

But MND also said it has asked AHTC why it did not require Workers' Party MPs Sylvia Lim and Low Thia Khiang to recuse themselves from the town council's financial matters, adding that it will, upon receiving AHTC's response, consider whether further regulatory action is needed to ensure public monies are properly safeguarded.

In a statement, the ministry said the performance of the town councils was comparable to that of previous years.

The annual report appraises town councils in five areas: estate cleanliness, estate maintenance, lift performance, management of arrears in service and conservancy charges, and corporate governance.

They are given green, amber or red scores.

This time around, only AHTC and Jurong-Clementi Town Coucil got two amber grades each, while Holland-Bukit Panjang Town Council and Tampines Town Council got one amber grade each, and the other 12 town councils got green grades for all indicators.

The town councils are assessed based on measurable objective criteria they and their auditors submit.

For the first time since 2011, AHTC's audited financial statements were unqualified by its auditors.

It scored green for corporate governance, which measures compliance with the law in areas such as announcing and awarding tenders.

The MND attributed this to the efforts of KPMG, which the town council had hired in 2016 to look into its books following a Court of Appeal ruling.

MND said in a statement that KPMG had helped AHTC remedy its past control failures and audit points over a period of 24 months, and that the Housing Board had provided funding for this work.

MND expresses concern

MND said it wrote to AHTC on Wednesday to seek an explanation on why it has continued to allow Ms Lim and Mr Low to be involved in the town council's financial affairs.

"For good governance, AHTC should take interim measures to safeguard its procurement and payment processes immediately," it said.

Last month, Parliament voted on a motion that called on Ms Lim and Mr Low to discharge themselves from all financial matters at AHTC.

This followed a High Court verdict in October which found that both MPs had acted dishonestly. The two are challenging the High Court's decision.

On Nov 30, AHTC said in a media statement that Ms Lim and Mr Low will not need to recuse themselves from all financial matters.

The decision was made at its recent quarterly meeting, where the council voted 17 to 1 against the recusal.

But MND said on Thursday that until and unless their appeal succeeds, the High Court's findings "remain good and should be taken seriously by AHTC".

"In particular, MND remains concerned as to whether the measures implemented under KPMG's guidance are adequate to guard against a recurrence of the past control failures if Ms Lim and Mr Low continue to be involved with AHTC's financial affairs, especially since the adequacy of the measures is entirely dependent on their implementation by the individuals involved with AHTC's financial affairs."

Apart from asking for AHTC's reasons for not requiring the recusal, the ministry also asked whether the town council intends to implement other interim measures or safeguards.

"Upon receiving AHTC's response, MND will further consider whether regulatory action needs to be taken in order to ensure the proper safeguarding of public monies entrusted to Town Councils," it said.

In a statement on Thursday night, AHTC said it would respond to MND by the stipulated deadline of Dec 13.

The town council said it had worked alongside KPMG to resolve control-related issues identified for resolution.

"We thank KPMG for the guidance to improve our control processes, as well as AHTC staff for the long hours put in to facilitate the completion of this rigorous audit exercise."

AHTC also said it had initiated a self-funded internal audit engagement with Baker Tilly Consultancy (Singapore) to improve the rigour of its finance and management processes.

"It is thus encouraging to receive news of our improved rating in corporate governance, as it represents the good work carried out in particular by our management team, the finance department, then vice-chairman Png Eng Huat and current vice-chairman Sylvia Lim."

It added: "AHTC notes the rest of the TCMR (Town Council Management Report) and will continue to work hard to improve the safety and living environment of the town."