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MND to review Town Council Management Report indicators

SINGAPORE — More town councils had a moderate level of estate maintenance issues, while the Aljunied-Hougang Town Council (AHTC) maintained its “red” banding in corporate governance in the Ministry of National Development’s (MND) latest Town Council Management Report released on Monday (Nov 20).

MND to review Town Council Management Report indicators

More town councils had a moderate level of estate maintenance issues, while the Aljunied-Hougang Town Council maintained its “red” banding in corporate governance in the Ministry of National Development’s latest Town Council Management Report. Photo: Nuria Ling/TODAY

SINGAPORE — More town councils had a moderate level of estate maintenance issues, while the Aljunied-Hougang Town Council (AHTC) maintained its “red” banding in corporate governance in the Ministry of National Development’s (MND) latest Town Council Management Report released on Monday (Nov 20).

The ministry also announced it would review the current set of indicators and methodology – in place since the 2012 financial year – to see how they can be improved.

“We will be engaging views from stakeholders in the course of this review, and welcome all feedback and inputs,” it said.

Its FY2016 Town Council Management Report is the first for town councils formed after the 2015 General Election.

The report’s five indicators are: Estate cleanliness, estate maintenance, lift performance, service and conservancy charges (S&CC) arrears management and corporate governance. Town councils are placed in the “green”, “amber” or “red” bands for each category.

A “green” banding for lift performance generally means fewer than two breakdowns per month for every 10 lifts, and fewer than two in 100 lifts having a non-functioning automatic rescue device (which takes the lift car to the nearest lift landing during a power failure), for instance.

For FY2016, all 16 town councils were banded “green” in estate cleanliness and lift performance.

In S&CC arrears management, all 15 town councils run by the ruling People’s Action Party were banded “green”, while the Workers’ Party-run AHTC was “amber” – an improvement from the “red” band for the first time since 2011.

In MND’s previous report, AHTC’s score for S&CC arrears management had been pending and was later banded red, after the town council submitted revised figures to the ministry, said the MND.

Responding in a media statement, AHTC chairman Pritam Singh thanked residents for paying their S&CC promptly.

In estate maintenance — which examines items such as damaged pipes or walls and obstructions in common areas — only four town councils scored “green” while 12 were “amber”, an increase from 11 in the previous MND report. The best town councils in estate maintenance were Ang Mo Kio, Nee Soon, Sembawang and Tanjong Pagar, which had fewer than four defects observed per block, on average.

The others had four to fewer than eight defects per block, on average.

But Ang Mo Kio town council did not fare as well in corporate governance as other town councils run by the ruling party. This was because the town council had not sought approval from the correct approving authority for waiver of quotations, as required under the Town Councils Financial Rules.

Only AHTC’s financial statements, however, were qualified by its external auditor for the sixth consecutive year, said the MND. The auditor issued disclaimers because it was unable to ascertain AHTC’s opening balances, payables and accrued expenses, or verify staff costs.

AHTC’s three points of non-compliance with Town Councils Financial Rules were: Its late quarterly transfer to the sinking fund, a waiver of quotation that was not in accordance with requirements, and its fixed assets count report not certified by the town council in accordance with the rules.

AHTC said it has drawn up a fixed assets checklist with a column specifically requiring certification by a key officer of the town council.

The waiver of quotation was for human resource payroll processing services, attendance and e-leave tracking services, said Mr Singh. This was in view of preliminary one-time setup costs sunk in July 2015. The town council felt it was more viable to continue with the existing service provider for one more year, as the service provider confirmed it would not increase charges for services rendered, he said.

AHTC requested for quotations in August this year and invited six vendors to submit quotes, but only the existing service provider responded, said Mr Singh.

As for the late quarterly transfer to the sinking fund, Mr Singh said AHTC has enhanced its internal system to monitor key deadlines to “minimise the prospect of such administrative oversights”.

It has appointed Baker Tilly as its internal auditor for two years to check its internal control procedures, said Mr Singh. The town council has resolved 76 per cent of audit points as determined by auditors KPMG, and he said it expects to resolve the remaining points by early next year.

AHTC recorded an operating surplus of about S$4 million in this financial year due to contracts secured at favourable rates, he said. Part of the surplus will be used for town improvement works next year.

But Mr Singh said rising lift expenses will affect the town council’s operating costs in future. He said its contributions to the Lift Upgrading Programme has reduced its sinking fund surpluses, which will “require replenishment in due course”.

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