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Progress Singapore Party's Non Constituency Member of Parliament, Leong Mun Wai, raised an adjournment motion questioning government spending on Oct. 4.
However, Minister Indranee Rajah refuted suggestions that government has been wasteful, and said the PAP government has made honesty and prudence their watchword, and has put in place structures for accountability.
SPH Media Trust and Sports Hub
Leong referred to two cases in recent months in particular, involving "significant outlay of taxpayers' money".
The first is S$900 million for funding Singapore Press Holdings (SPH) Media Trust (SMT) over the next five years, and S$1.5 billion to terminate the public-private partnership operating Sports Hub, for a total of S$2.4 billion.
He alleged:
"Based on my 30 years of experience in business and financial management, I question the financial reasoning behind these expenditures. The government and this House must ensure that every tax dollar is properly spent. The government must respond in full to my queries, or Singaporeans can take it that taxpayers’ money has been wasted."
His adjournment motion was countered by Indranee, Minister in the Prime Minister's Office and Second Minister for Finance and National Development.
She said that Leong's claim that the government is not fiscally prudent, along with his assertions about SMT and Sports Hub were without basis.
Indranee said the issues have already been explained in detail in Parliament, but in order to prevent the Members of Parliament and the public from being misled, she would repeat them.
SPH Media Trust
Leong on SMT
Leong said the deal to restructure SPH is "questionable" because in his view, SPH shareholders should have left behind a larger share of SPH’s property assets to support the print media business under the SPH Media Trust.
SPH used what Leong said was their "monopoly profit" of the print media business to accumulate numerous property assets, sold for S$3.9 billion after the restructuring.
However, only S$110 million of cash and shares were left behind to SPH Media Trust to "fund the loss-making media business."
Leong said it made "no business sense" for the government to agree to its proposal, and said more money should have been left behind to continue funding the media arm.
He pointed out that it would have been fairer for S$900 million to be left behind by SPH shareholders so SMT could be supported without public funds. The shareholders would still have S$3 billion left over.
Leong quoted Lee Boon Yang, former Cabinet Minister and then-Chairman of SPH, who said it is not unreasonable for SPH shareholders to make a contribution to SPH Media Trust to sustain the media business.
Leong said when he questioned Communications and Information Minister Josephine Teo during the Committee of Supply 2022, she replied there might have been no deal if SPH bore the S$900 million bill.
Indranee on SMT
In her response, Indranee expounded on the need for the government to support SMT, including the Malay, Chinese and Tamil print publications.
She explained why the deal went ahead:
"Mr Leong asks why can’t the SPH shareholders pay more. But Minister Josephine Teo had already explained that the shareholders voted and agreed to an injection of S$80 million cash and S$30 million worth of shares for SMT.
If the restructuring involved an even higher contribution, the shareholders could have walked away, in which event there would be no SMT and along with that, all the downsides already mentioned."
Indranee added, "Mr Leong fails to recognise the realities facing the media industry in the real world" and if the government had done as he suggested, SPH media would be left on a "trajectory of decline and eventually result in a Singapore without a viable English-language domestic media and without our Chinese, Malay and Tamil media – which is not in our national interest".
Sports Hub
Leong on Sports Hub
Leong said he supports the government's takeover of Sports Hub, being aware of the financial and development benefits.
However, he said he believes the government has been "overly generous" in estimating the “fair open market value” and the remaining financial liabilities of Sports Hub, which would supposedly benefit Sports Hub Private Limited (SHPL) unfairly at the taxpayer's expense.
Leong said the S$1.5 billion termination cost was too high, and said that according to his calculations, it should be much lower and asked the government to justify the cost.
Indranee on Sports Hub
In response, Indranee said Community, Culture and Youth Minister Edwin Tong already explained the rationale in Parliament, specifically how the government benefited from terminating the Public-Private Partnership (PPP) agreement.
Indranee highlighted that the construction risks were borne by the consortium, which meant the government did not have to bear the costs of constructions delays, defects such as roof leaks, issues with the pitch and sound quality. It also freed up financial resources during the global financial crisis of 2009.
"Mr Leong claims that the Termination Sum of S$1.5 billion is too high. But Minister Edwin Tong had already explained the basis for this figure. The Termination Sum is derived based on a formula stipulated in the Project Agreement. Most of it is made up of the capital expenditure which the Government would have had to bear if we had opted for the traditional procurement model.
Minister Edwin had also explained that the full costs of termination is comparable to the financial obligation that we would have had to pay under the PPP if we had chosen to continue with it. In other words, the entire transaction is financially neutral, because we are not paying SHPL more than what we would have otherwise committed to under the PPP model."
Indranee said Leong ignored the detailed explanations and made a "completely baseless and false claim" that the termination sum could be lower.
Leong's allegations completely without basis: Indranee
Indranee said that Leong's allegations on SPH Media Trust and Sports Hub were "completely without basis", yet he continued to pursue them repeatedly despite having heard the explanations many times.
Indranee said:
"You have to wonder why he does this. A charitable view is that Mr Leong genuinely does not understand the expenditure figures or the rationale that has been explained. But as he constantly reminds us, and reminded us again today, he has 30 years of experience in business and financial management so he shouldn’t have any difficulty understanding them."
She added:
"If he does understand them, then there's only one other conclusion, that this can only be a deliberate and cynical attempt to stoke anxiety and disquiet, confuse Singaporeans, and damage the government. I ask Members of this House and Singaporeans not to be taken in, but to reject these bogus allegations, and to support the government."
Singapore has in place a system of checks and balances, such as scrutiny of the yearly budget by MPs, the Estimates Committee, and regular, independent audits conducted by the Auditor-General's Office.
Indranee concluded:
"Mr Leong’s entire motion is an attempt to portray the government as profligate and heedless of our expenses. Nothing could be further from the truth. In persisting with these insinuations, Mr Leong is doing a disservice to Singapore, to our Government and to our public servants, charged with the sacred responsibility of looking after the public purse."
Top image from MCI YouTube.