Parliamentary panel highlights recurrent lapses in IT controls, financial governance in public sector

The Public Accounts Committee noted the lapses in many instances took place not because of a lack of rules, procedures or systems, but due to agencies failing to comply with the controls put in place.
The Public Accounts Committee noted the lapses in many instances took place not because of a lack of rules, procedures or systems, but due to agencies failing to comply with the controls put in place.PHOTO: ST FILE

SINGAPORE - The parliamentary watchdog of public sector accounts has flagged recurrent lapses by government agencies in the areas of IT controls and financial governance, and urged them to understand and fix the root causes.

The Public Accounts Committee (PAC), which reviews the Auditor-General's annual report, noted the lapses in many instances took place not because of a lack of rules, procedures or systems, but due to agencies failing to comply with the controls put in place.

This could be due to various reasons such as the lack of understanding or clarity of the rules, it said in the report it submitted to Parliament on Thursday (Jan 31).

To address the situation, the PAC said it is important that staff understand the purpose, underlying principle and rationale of rules put in place.

Also, it is "crucial for public sector leaders to set the right tone at the top and be involved in designing and implementing effective controls and processes".

The committee, which comprises eight MPs and is chaired by Ms Jessica Tan, made the call following its review of the Auditor-General's report for financial year 2017/18.

The blunders made, it noted, were "in the management of contracts, management of user accounts and access rights in IT systems, and in the area of procurement and payments".

The PAC is tasked to scrutinise how public funds are spent and track what government agencies have done to correct irregularities in the use of the funds.

  • Other lapses in public sector

  • SCDF

    The Singapore Civil Defence Force (SCDF) poorly managed two vehicle maintenance contracts. The Auditor-General's Office (AGO) report said it did not have adequate procedures to ensure contractors gave the required services, which cost $1.8 million a year.

    AGO's test-checks found the SCDF paid $120,000 for maintenance jobs purportedly done on 21 vehicles but which the contractors did not actually perform. Some servicing records given to the auditors were also created and backdated.

    To address the lapses, the SCDF introduced a system for its units to monitor and track the servicing records of vehicles, the Home Affairs Ministry (MHA) told the Public Accounts Committee (PAC).

    SCDF headquarters would tally the monthly invoice against servicing records before paying the contractors. It would also do surprise checks on the contractors.

    From the middle of this year, the SCDF would also use the MHA-wide integrated logistics management system. The system's vehicle maintenance module give vehicle maintenance plans and servicing details, among other features.

    PEOPLE'S ASSOCIATION

    The People's Association (PA) and one of its Grassroots Organisations (GROs) had lapses in procurement and contract management for major events.

    Serious weaknesses were also found in overseas purchases and payments for Chingay Parade 2017, including "tell-tale signs indicating that some cash sale receipts submitted for reimbursement claims might not be authentic", the PAC said.

    The Ministry of Culture, Community and Youth (MCCY) said the PA had put in place several measures, such as "centralising the management of high-value contracts to specialised procurement staff at PA headquarters and deploying specialised staff to assist GROs in their procurement, by mid-2019".

    Since last April, e-learning has started for grassroots volunteers and it includes training on financial and procurement matters.

    NATIONAL RESEARCH FOUNDATION

    The AGO said the National Research Foundation (NRF) did not have procedures for monitoring and recovering unused grants from recipients.

    An AGO test-check found unused grants were not promptly recovered in 10 out of 13 completed projects.

    The Prime Minister's Office told the PAC the NRF will set up clear procedures to monitor and follow up with recipients to ensure unused funds are recovered promptly. It will be done as part of the NRF's revision of the National Research Fund Guide.

On weaknesses in IT controls, the committee said the "review of user access rights, removal of obsolete user accounts and not sharing accounts are fundamental controls which agencies are required to comply with".

Calling for more to be done to ensure effective compliance, the PAC said "weaknesses in these controls could become the weakest link in IT systems".

One case the PAC highlighted related to the Defence Ministry, where authorised users were found to have shared their user accounts with unauthorised persons to perform procurement activities in the ministry's Electronic Procurement System.

The ministry informed the PAC it has taken a three-prong solution: Step up education efforts; strengthen its disciplinary framework for users who flout the rules; and improve its IT system, like automatically lock account access for users on overseas leave.

In contract management, the PAC flagged instances of failing to obtain proper approvals for the award of contracts in the People's Association (PA).

This was a recurrent lapse that was also raised in the Auditor-General report for financial year 2014/15.

The Ministry of Culture, Community and Youth (MCCY) said the PA formed the Grassroots Finance Review Committee in July 2015 to review the Grassroots Organisations' financial procedures, implemented various measures to improve compliance, and conducted training for grassroots leaders.

The ministry said it has observed progress since the measures were implemented, the PAC wrote.

It also told the PAC that to tackle the recurrent lapses, the PA has further refined the Grassroots Organisations' procurement policy.

The PAC also noted the various measures the Finance Ministry had taken to address the lapses at the whole-of-government level.

These include stepping up engagement with public sector leaders to ensure they understand their critical role in upholding a sound and robust system.

The Smart Nation and Digital Government Group is also doing a comprehensive review of IT policies centrally and this would be completed by the third quarter of 2019.

To tackle non-compliance with rules, the Finance Ministry has asked agencies to review their internal policies and processes to "strike a sensible balance between strengthening controls and sustaining operational efficiency", the PAC's report said.