All town councils except Chua Chu Kang TC received green rating in latest management report

SINGAPORE: In the town council management report released on Thursday (30 Nov), all 17 town councils received the highest rating (green), except for Chua Chu Kang Town Council (CCKTC).

CCKTC was the only one with a lower rating, “amber” in the FY2022 Town Council Management Report (TCMR)- Governance Report issued by the Ministry for National Development (MND).

The report primarily evaluates town councils’ corporate governance and internal controls.

CCKTC received an ‘amber’ rating due to two instances of non-compliance with the Town Councils Act, which were categorized as administrative oversights and have since been rectified.

According to the TC corporate governance compliance checklist for FY ended 31 March 2023, CCKTC was flagged for conducting improvement works on non-common property before obtaining approvals from MND.

“There being more than one instance of the same type of non-compliance, this was considered as a medium severity observation,” noted MND in a statement.

CCKTC is under the oversight of Gan Kim Yong, Minister for Trade and Industry; Dr Amy Khor, Senior Minister of State for Ministry of Sustainability and the Environment and Ministry of Transport; Ms Low Yen Ling, Minister of State for Ministry of Culture, Community, and Youth, and Ministry of Trade and Industry; alongside MPs Zhulkarnain Abdul Rahim and Don Wee.

MOS Low Yen Ling holds the position of chairman at CCKTC, while Dr Amy Khor serves as the vice-chairman. Additionally, Ms Low held the role of Mayor in the South West District.

Four ‘green’-rated TCs cited for ‘low severity observations’ by MND

MND noted that out of the remaining 16 town councils that received ‘green’ ratings, four had a minor issue each, categorized as ‘low severity observations’ under either the Town Councils Financial Rules or the Town Councils Act.

These councils – Aljunied-Hougang, East Coast, Jurong-Clementi, and Marsiling-Yew Tee – encountered first-time administrative oversights that were promptly rectified, according to the ministry.

Despite these observations, these four town councils maintained their ‘green’ ratings for corporate governance, as each case of non-compliance was considered of low severity and scored only 0.5 points.

The rating system assigns points based on the severity of observations. Offences under the Town Councils Act are categorized as high severity and result in higher point allocations.

Town councils scoring less than one point are awarded a ‘green’ rating, while those scoring between one to less than two points receive an ‘amber’ rating. A score of two points or higher results in a ‘red’ rating.

The report conducted by the MND is based on an assessment of the town councils’ FY 2022 audited financial statements, along with their auditors’ reports.

It also includes checks on the town councils’ compliance declarations concerning the Town Councils Act and Rules.

The report encompasses the period from April 2022 to March 2023 and is an annual publication. It is distinct from an operational report published in June, which focuses on aspects like estate cleanliness, lift performance, and the management of Service and Conservancy Charges (S&CC) arrears.

MND: All TCs reported weaker financial positions for FY 2022

MND highlighted that all town councils reported weaker financial positions for the FY 2022.

The primary reasons cited were increased cost pressures stemming from higher water and electricity prices, as well as elevated expenses for lift maintenance and other maintenance works.

This stands in contrast to the previous governance report when town councils generally reported surpluses for the 2021 financial year.

“All TCs have either increased, or announced plans to raise their S&CC rates in FY2023 and/or FY2024, which is expected to improve their financial positions,” said MND.

The People’s Action Party (PAP)-run town councils declared back in June their decision to raise S&CC twice over the upcoming two years.

The initial increase has already been implemented, effective from July 1. The subsequent hike is scheduled to take effect on July 1, 2024.

On the other hand, the town council managed by the Workers’ Party (WP), Aljunied-Hougang Town Council (AHTC) also announced a similar plan for two S&CC increases. The first rise occurred on Oct 1, and the second is slated for July 1, 2024.

Additionally, Sengkang TC, another under the WP, plans to initiate its S&CC increase starting from March 1, 2025.

“The Government will continue to monitor the TCs’ financial positions and assess if further support is required beyond ongoing assistance provided to all TCs, such as substantive operating grants and special funding support,” added MND.