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No abuse of power or conflict of interest was found by Senior Minister and Coordinating Minister for National Security Teo Chee Hean in his review of the rental of state properties at Ridout Road by Ministers K Shanmugam and Vivian Balakrishnan.

Teo's report and a report by Corrupt Practice Investigation Bureau (CPIB) were submitted to Prime Minister Lee Hsien Loong, said the Prime Minister's Office (PMO) in a press release on Jun. 28, 2023.

The CPIB report found no evidence of corruption or criminal wrongdoing by the Ministers.

CPIB also found no preferential treatment given to the Ministers and their spouses, and no disclosure of privileged information in the process of the rental transactions.

But CPIB discovered a "lack of precision" in the Singapore Land Authority’s (SLA) use of the term "guide rent" with respect to 26 Ridout Road, which was rented by Shanmugam.

In other words, an earlier statement SLA made on May 12, saying that the offer by Shanmugam was above the guide rent, was incorrect.

“In fact, the rental Minister Shanmugam paid was equal to the correct guide rent on the property,” CPIB said in its report.

These reports came after questions raised by the public and allegations against Shanmugam and Vivian regarding their rental of state properties at Ridout Road.

PM Lee directed CPIB to investigate the matter on May 17, 2023.

Teo was instructed by PM Lee to conduct a separate review on May 22, 2023, to address the wider potential process or policy issues.

Teo's report

Teo's approach to his review came in consultation with PM Lee, and deciding that his review would rely on CPIB's investigation, which would establish the facts of the case.

CPIB's investigation is carried out by professional investigators empowered by the Prevention of Corruption Act.

“It would neither be necessary nor helpful to launch a separate process of fact finding and questioning of officials involved in the renting out of the two Black and White bungalows as this could overlap with CPIB’s investigation and delay both that investigation and this review," said Teo.

No conflict of interest

Teo's report submitted to PM Lee concluded that the Ministers, the public officers, and the private sector intermediaries involved "conducted themselves properly" in the rental of the two properties.

"There was no abuse of power or conflict of interest resulting in the Ministers gaining any unfair advantage or privileges," said the report.

"They were aware of their duty to declare and avoid any conflict of interest and took appropriate steps to prevent any potential or actual conflict of interest from arising."

In Shanmugam's case of renting 26 Ridout Road as Minister for Law, which oversees the Singapore Land Authority (SLA), a conflict of interest could have arisen if Shanmugam had remained in the chain of command, exercising authority over renting the property.

If Shanmugam made decisions that affected his rental of 26 Ridout Road, that would be considered an actual conflict of interest.

However, the CPIB reported that Shanmugam removed himself from the chain of command. He informed then deputy-secretary (DS) of the Ministry of Law (MinLaw) he would recuse himself from any discussion related to the rental of the property.

Shanmugam also instructed then DS of MinLaw to approach then Senior Minister of State for Law Indranee Rajah in the event that any matter had to be referred to the Minister.

The CPIB report also noted that due diligence checks were done before signing the Tenancy Agreement for 26 Ridout Road.

Ministers did not benefit from privileged information

No preferential treatment was given to the Ministers and their spouses, and no disclosure of privileged information in the process of the rental transactions, CPIB reported.

"There was no evidence to suggest any abuse of position by the Ministers for personal gain," said the director of CPIB, Denis Tang, in a letter to PM Lee.

Teo's report noted that the Ridout Road estates were managed by professional third-party Managing Agents who determine the rental price based on market conditions.

Ministers did not benefit unfairly from favourable rental rates

In addition, Teo's review established that the rental rates paid by both ministers were at fair market value and not below market valuation.

He said, "There was no evidence that the ministers were given favourable rental rates due to their positions."

The review also found that the tenancy terms and renewal of both properties were in accordance with the general policies that guide tenancy and renewal of tenancies for residential properties managed by SLA.

Incident highlights the importance of Public Office Holders understanding and upholding key principles

Teo's report concluded that this episode highlights the "paramount importance of public office holders and public service officers understanding and upholding key principle of acting with integrity at all times".

Teo noted that maintaining high standards of integrity and accountability in the government and the nation demands constant effort.

He said:

"Ultimately, the integrity and quality of Singapore's system of governance depends on our collective efforts, generation after generation, to instil strong values in our people, especially the men and women in politics and public service to continue serving with integrity and excellence even when no one is looking."

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