MND responds to Workers’ Party

theonlinecitizen May 15, 2013

By Leong Sze Hian

I refer to the article “MND explains computing method for MA rate for town councils” (Channel NewsAsia, May 14) in  response to the Workers’ Party’s media release of 14 May – “AHPETC / WP’s RESPONSE TO COMPARISONS ON MANAGING AGENT RATES”.

Did Ministry of National Development (MND) calculate using all residential and commercial units?

It states that “The National Development Ministry said it computes the Managing Agent (MA) rate per unit for each town council by dividing the MA tender rate that the town council submits to HDB by the total number of residential and commercial units the town council manages and covered by the MA contract.

The town councils collect Service and Conservancy Charges from both residential and commercial properties.

The ministry said this is the method it has always used, and applied consistently to all town councils.

Aljunied Hougang Punggol Town Council (AHPTC) calculate using residential units only?

The ministry added it notes that the numbers provided by Aljunied-Hougang-Punggol East Town Council only covered residential units and excluded the commercial units and this provides an incomplete picture.

“Complete picture” may look even better for AHPTC?

I am rather puzzled by the above, because if AHPTC uses the MND’s method of “dividing the MA tender rate by the total number of residential and commercial units”, instead of “by only the residential units” as AHPTC had done – wouldn’t the AHPTC MA rate per unit be even lower?

If this is correct, wouldn’t it make AHPTC’s rebuttal even stronger and better?

If so, what is the MND trying to say in its “this provides an incomplete picture”?

In other words, the “incomplete picture” may actually make AHPTC look worse than the “complete picture”?

Why not just do the calculation?

Actually, for the sake of clarity and to avoid any further confusion, the MND could just simply have calculated the “complete picture” and included it in its statement, instead of merely saying “this provides an incomplete picture”.

Comparison with Tampines?

As to “As a comparison, the ministry referred to Tampines Town Council as it was closest in size to Aljunied-Hougang Town Council, with the number of units managed at about 57,000.

EM Services was the Managing Agent for Tampines.

In FY2010, it charged a monthly rate of $5.14 per property unit.

In FY2011, it charged $5.15 per property unit..

WP’s rebuttal

In August 2012, an open tender was called, and CPG Facilities Management won the bid to provide MA services to Tampines Town Council, at a monthly rate of $4.99 per property unit” – Let’s look at what the Workers’ Party said in this regard – “According to the Minister, Tampines TC’s MA rate for 2012 is $4.99 per property unit.

MA change, rate drop?

We understand that there was a change in MA from 2011 to 2012, meaning that it was the first year in Tampines for the incumbent MA, CPG.  Coincidentally, CPG was incumbent in Aljunied TC until 2011, and its unit rate tendered in FY 2010 for Aljunied had been $6.51 (according to the government’s tables).

We do not wish to speculate why a MA would tender in 2012 at a lower rate for MA services than in 2010, given the rising costs.  However, we note that as early as at 2007, another MA, EM Services, had tendered at $5.75 per residential unit for Pasir Ris-Punggol Town.

Table 3 – Tampines TC’s MA rate

Managing Agent FY 2007 FY 2010 FY 2012
EM Services – PRPG $5.75
CPG – ATC $6.51
CPG – Tampines TC $4.99

“Selective” comparison?

We can only surmise that the Tampines TC’s MA rate of $4.99 in 2012 which was chosen for comparison was an outlier”.

Figures appear to be different?

So, Singaporeans are perhaps even more confused now because if you look at the MND’s and the WP’s media statements (and of course as well as what the Minister said in the Parliamentary debate) – both parties’ MA rates for both AHTC and Tampines appear to be different.

More detailed data please?

I would like to suggest that they both come up with more detailed calculations to show Singaporeans how each side’s figures were derived – such as what was the total tender sum, number of residential and commercial units, etc – rather than just talking – like in a war of “words” without more detailed “numbers”.

Let’s have a  more complete comparison?

The MND should also give the numbers for all the 14 town councils, instead of just Tampines.

Comparison was an outlier?

Saying “As a comparison, the ministry referred to Tampines Town Council as it was closest in size to Aljunied-Hougang Town Council, with the number of units managed at about 57,000″ – may have opened its “comparison” to what I believe the WP may be hinting at, in its statement that it may be an unfair selective comparison –

(WP’s words – “We do not wish to speculate why a MA would tender in 2012 at a lower rate for MA services than in 2010, given the rising costs.

We can only surmise that the Tampines TC’s MA rate of $4.99 in 2012 which was chosen for comparison was an outlier”).

Some questions for the sake of clarity?

In this connection, does Tampines have the lowest MA rate amongst the town councils?

Any other town council had a decrease in its MA rate by 3 per cent or more like Tampines, compared to the rates in FY2011 and FY2010?

What is the range in the variation of MA rates for all the town councils, relative to Tampines?

How does AHPTC’s rates compare to all the other town councils?

Why did Tampines increase S & CC?

Finally, if Tampines happens to have the lowest rate which also decreased – whereas the others increased over the last 2 years (I am just speculating for the purpose of using an example now, as I have no way of telling without the data) – then why did Tampines town council increase its S & CC last year, when it had an operating surplus of $3.51 million in the financial year 2010/2011, surplus for the financial year of $6.9 million and an accumulated surplus of $8.4 million?

AHPTC reduced S & CC

Also, by the way, AHPTC reduced its S & CC after it took over the town council, following the last elections.

So, what do we seem to have here – at least from the perspective of residents – a much lower MA rate like in Tampines means an increase in the S & CC – and  a much higher (which is the subject of contention now) MA rate in AHPTC means a decrease in the S & CC?

About the Author

Leong
Leong Sze Hian has served as president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), invited to speak more than 200 times in over 30 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of Indonesia and Brunei. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.