TOC, ex-GIC chief economist issued Pofma orders over false statements on HDB's losses, rules on state land sales

SINGAPORE — National Development Minister Desmond Lee has instructed the anti-fake news office to issue correction directions to socio-political website The Online Citizen and former GIC chief economist Yeoh Lam Keong over “false and misleading” statements they made online.

The statements, posted on social media and in online articles, were regarding the Housing and Development Board’s (HDB) deficits and Singapore’s past reserves, the Ministry of National Development (MND) said in a statement on Friday (Oct 14).

Mr Yeoh had published two Facebook posts on Oct 4, after Mr Lee told Parliament that day that the Housing and Development Board (HDB) will incur an overall loss of about S$270 million for the Build-to-Order (BTO) project Central Weave@AMK, which made headlines when some of its units were priced at almost S$900,000.

Mr Yeoh called it a “rather disingenuous and misleading analysis” and described the reported figures as an “accounting sleight of hand”. 

Since the Government acquired most of the land at a minimal or much lower cost by compulsory acquisition, Mr Yeoh claimed that this S$270 million figure is the opportunity cost of the state reselling the land at market price, which it has passed on to the HDB.

"The true cost price should be the original book value of the land plus construction costs which on average is much lower than BTO prices before subsidy," Mr Yeoh added.

TOC then published an article on the same day echoing the points raised by Mr Yeoh. 

It published a second article the next day with the headline: “Singapore’s reserves substantially profits from $500m land sales in AMK BTO”.

The article claimed that Mr Lee’s reply alluded to “profits being made from the land sale by the government” and that “such profits would go to the reserves”.

MND said on Friday that Mr Yeoh's posts falsely convey that HDB will not incur a S$270 million loss from the BTO project and that the Government is free to sell state land at nominal or much lower cost than its fair market value.

Meanwhile, TOC's headline falsely conveys that the Government’s sale of land to HDB for the Ang Mo Kio BTO project will lead to an increase in Singapore’s reserves, it said.

“The losses incurred by HDB, as stated by Minister (Desmond Lee) in Parliament, are accurate and real," MND said. "Real money is involved, and this is certainly not an 'accounting sleight of hand'."

MND said that state land is part of Singapore’s past reserves and not assets the Government can use as it wishes.

“When HDB requires land to develop flats, the land has to be taken out of the past reserves. HDB has to purchase the land by paying fair market value for the land, and the money goes into the past reserves,” MND said.

It added that the estimated land cost for Central Weave@AMK is about S$500 million.

The Government cannot sell state land at nominal or much lower cost than its fair market value without the President’s approval, because doing so would constitute a draw on past reserves, MND said.

If the Government arbitrarily prices the land below its fair market value, such as at the price it paid to acquire the land, then it would not be putting back fully what it has taken out of the past reserves, the ministry said.

“This is equivalent to drawing down the reserves and short-changing future generations, depriving them of their nest-egg.”

An established process is used to determine the fair value of land, with a chief valuer — a public officer whose appointment requires the President’s agreement — independently determining the value using the same valuation principles adopted by professional valuers in the private sector, MND said.

“Neither the Government nor the past reserves profit from land sales,” MND said. “When state land is disposed of at fair market value, there is no addition to the past reserves but a conversion of one type of asset (land) to another (cash).”

Under the Protection from Online Falsehoods and Manipulation Act (Pofma), TOC and Mr Yeoh will be required to insert a notice on their original posts and articles with a link to the Government’s clarification.

TOC has been subject to Pofma orders in the past. In September last year, it took down its website and social media pages after the Infocomm Media Development Authority suspended its class licence for failing to declare its funding sources.

Last month, it reactivated its website and social media accounts with its editor Terry Xu saying he is relocating to Taiwan.