The Auditor-General’s Office (AGO) identified lapses in the Ministry of Social and Family Development (MSF) and the Early Childhood Development Agency (ECDA) in its thematic audit of parenthood support measures.

The AGO is an independent office that audits all of Singapore’s government entities’ accounts.

The thematic audit focused on parenthood support measures administered by MSF and ECDA from Apr. 1, 2021, to Jun. 30, 2023, according to a report published on Jul. 17 by AGO.

In response to the AGO report, MSF and ECDA said all the lapses flagged by AGO have been addressed.

MSF has also filed police reports over unusual withdrawals from Child Development Accounts (CDAs), possible misuse of CDA moneys, alleged falsification of documents, as well as possible abuse of government-paid leave schemes by parents.

S$4.55 billion disbursed under five grant schemes

The government disbursed a total of S$4.55 billion under the following grant schemes during the audit period:

MSF

• Government-Paid Leave Schemes (GPLS)
• Baby Bonus Scheme – CDA Benefits

ECDA

The irregularities

In general, the AGO noted that MSF and ECDA had processes and controls in place across its various grant stages to ensure proper management of its schemes.

However, AGO flagged possible lapses under the grant schemes.

GPLS

The lapses flagged included possible irregularities in GPLS, including fraudulent behaviour and abuse of the GPLS system.

For instance, AGO found cases with unusual patterns in the declared employment income of parents which pointed to possible abuse of GPLS.

The AGO report highlighted that there were 55 cases involving 32 parents and S$1.16 million disbursed "with indications of possible abuse".

The examples cited were:

• A significant increase in declared employment income at the start of the leave claim period followed by a significant decrease in the income after the Government-paid leave period was over.
• Parents who had multiple employer claims made for the same child, where those parents were directors and/or shareholders of the employing entity.

There were also lapses in grant evaluation which included cases where disbursements were made even though criteria were not met.

Baby Bonus Scheme

For the Baby Bonus Scheme, the AGO observed unusual withdrawals from CDAs, the fabrication of records by one Approved Institution (AI) for audit purposes, and inadequate monitoring of AIs and CDA withdrawals.

The unusual withdrawals from CDAs include frequent withdrawals made within short periods of time, as well as purchase of items such as adult-sized sunglasses which cast doubt on whether the purchase was made for the benefit of the child or his siblings.

In one case flagged by AGO, one parent made as many as 20 withdrawals totalling S$15,000 within three months.

Other lapses

AGO also highlighted delays in the processing and disbursement of grant claims and completion of ECDA-commissioned audits on Anchor and Partner Operators (APO), as well as system errors and lapses affecting eligibility assessment for preschool subsidies.

There were also lapses in documentation by preschools for subsidy applications and backdating or alteration of documentation for audit purposes.

All lapses addressed

In a statement released on Jul. 17, MSF and ECDA said that all lapses have been addressed.

The ministries also said they have initiated further actions to strengthen the controls and monitoring measures for the disbursement of its grants and subsidies.

Police reports lodged

As of Jul. 17, MSF has lodged police reports in relation to 26 cases of possible abuse of the GPLS and has blocked errant employers from making further claims.

MSF has also lodged a police report in relation to six cases of unauthorised CDA withdrawals with suspected criminal intent.

The ministry said those who misuse CDA monies will be required to make refunds to the CDA.

MSF said it has enhanced capabilities for detection, investigation, and enforcement to prevent future cases of fraud and abuse.

Streamlining, strengthening

Meanwhile, ECDA has streamlined grant administration processes to ensure timely disbursement.

It issued warnings to errant preschools, and is working to strengthen its subsidy administration system, while tightening audit controls to prevent discrepancies between centers' annual audited reports and their declarations.

Committed to good governance: MSF and ECDA

MSF and ECDA said they are "committed to ensuring good governance and processes" in their grant disbursements and scheme implementation.

"Apart from taking active steps to resolve the lapses in AGO findings, MSF and ECDA will continue to put in efforts to strengthen our processes, such as in the monitoring and controls for disbursements of our grants and subsidies."

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