The Workers' Party MPs subverted proper process and allowed their friends to reap a handsome profit at the expense of residents when they appointed Aljunied-Hougang Town Council's (AHTC) managing agent without calling a tender, said Second Minister for National Development Desmond Lee yesterday.
He said his ministry has "long recognised the political nature of town councils" and accepts that political considerations may go into appointing contractors.
But such latitude needs to be exercised within the boundaries of the law, and public funds and residents' interests must be properly safeguarded at all times, he added.
Mr Lee was speaking in support of Deputy Prime Minister Heng Swee Keat's motion, which, among other things, called on WP leaders Sylvia Lim and Low Thia Khiang to recuse themselves from all financial matters at AHTC, after a High Court judge found the duo had acted dishonestly and in breach of their fiduciary duties.
The WP, he said, gave excuses to justify waiving the tender for the newly formed FM Solutions & Services (FMSS) to become the new managing agent, while it kept the incumbent CPG in the dark about FMSS. These excuses included CPG suddenly announcing that it intended to depart and the abrupt termination of AHTC's computer system by the People's Action Party-linked firm Action Information Management.
"The fanning of this smokescreen was egregious because the case for urgency was completely manufactured," said Mr Lee, adding that the public and Parliament were deliberately misled.
He also made the point that there was "simply no basis" for FMSS to charge higher rates than CPG, which was more experienced and had a better track record.
The WP should have ensured that they charged less, especially in circumstances where no tender was called, said Mr Lee, who is also Minister for Social and Family Development. "It is one thing to award contracts to friends for political reasons, but another to allow them to reap a profit or to pay them more," he said, echoing remarks made by Mr Heng.
Mr Heng had earlier said that allowing friends to help themselves to public funds was a tale that belonged to the Third World, and not Singapore.
Mr Lee reiterated Mr Heng's call for the WP MPs implicated to recuse themselves from AHTC's financial affairs, saying it was the "right and proper thing to do". He noted that if the same thing had happened in the corporate sector, the management would recuse themselves from running the company.
He also drew comparisons to former Ang Mo Kio Town Council general manager Wong Chee Meng, who had to step down on corruption charges.
Said Mr Lee: "Let professionals or other WP MPs who are not implicated manage the financial affairs and transactions of the town council, until the appeal is disposed."