Kenneth Jeyaretnam questions potential mismanagement by SLA over rents for Ridout Road

CORRECTION NOTICE:
This article contains a false statement of fact. For the correct facts, click here: https://www.gov.sg/article/factually180224

SINGAPORE: Mr Kenneth Jeyaretnam, the Secretary-General of the Reform Party, has once again raised concerns about the rental payments made by PAP Ministers Mr K Shanmugam and Dr Vivian Balakrishnan for their black and white bungalow (BWB) at Ridout Road.

This time, he is probing whether the potential mismanagement of Singapore’s precious land reserves and the failure to secure the best possible rental for the Ridout Road properties is a result of incompetence on the part of the Singapore Land Authority (SLA) management.

Despite Mr Jeyaretnam persistently scrutinizing the ministerial property rentals at 26 and 31 Ridout Road, he has faced at least five Correction Directions (CD) under the Protection from Online Falsehoods and Manipulation Act (POFMA) in response to his allegations related to the Ridout Road matter.

In his latest Facebook post, Mr Jeyaretnam expressed frustration, noting that every time he highlights the alleged low rents paid by Mr Shanmugam and Dr Balakrishnan for their Ridout Road mansions, especially when compared to rentals of smaller private properties, the Government has sought to silence him using POFMA.

However, he drew his followers’ attention to a recent SLA’s bidding activity, further questioning whether the rental of BWBs rented by the two ministers was “unusually low”.

On 1 February, SLA announced a bidding activity for a BWB at 41 Malcolm Road on its official Facebook page.

Although the bidding has concluded, a check on the State Property Information Online (SPIO) website revealed four bids, with the highest being S$22,242 per month.

The SPIO website indicates that SLA is currently evaluating the bids, and there is no information available regarding whether the top bid has been accepted.

Since the guide rent has not been disclosed, it remains unclear if the bid was below the guide rent. The tenure offered in the tender was only two years.

The Malcolm Road property boasts 3 bedrooms and 4 bathrooms, with a Total Gross Floor Area (GFA) of 5,279 square feet and a land area of 28,388 square feet.

Mr Jeyaretnam’s critique of SLA management

Mr Jeyaretnam highlighted the stark contrast in rental rates between the properties, emphasizing that 26 Ridout Road, rented by Mr Shanmugam for S$26,500 per month, and 31 Ridout Road, initially rented by Mr Balakrishnan for S$19,000 per month (later increased to S$20,000), have GFAs exceeding 9,000 square feet.

He further pointed out that the total land area for both 26 Ridout and 31 Ridout is nearly 10 times and 5 times, respectively, that of 41 Malcolm Road.

Mr Jeyaretnam argued that the rents for 26 and 31 BWBs should be at least double, if not more, given their prestigious location, larger GFAs, and expansive gardens.

In addition to questioning the rental rates, Mr Jeyaretnam raised concerns about the tenure terms—3+3+3 for 26 Ridout and 2+3+3 for 31 Ridout.

“The Government will claim that the Ridout Road properties were rented at a time when rents were much lower and that they were indeed “market,” said Mr Jeyaretnam.

“However I do not believe that they were less than half what should be the rental today. In any case why have the rents not been revised sharply upwards at the end of the initial term but renewed at the same price?”

Mr Jeyaretnam in his post clarified that he is not accusing Mr Shanmugam and Dr Balakrishnan of any wrongdoing as CPIB, which is part of the Prime Minister’s Office, has cleared both gentlemen.

Senior Minister Teo Chee Hean, leading the independent review on the Ridout Road saga, declared in a parliamentary sitting on 3 July 2023 that the review concluded there was no conflict of interest in the rental of these two properties.

Therefore, Mr Jeyaretnam pointed out that what appears to be mismanagement of Singapore’s precious land reserves and the failure to secure the best possible rental for the Ridout Road properties is purely the result of incompetence on the part of the SLA management.

“I look forward to receiving their explanation, ” he said.

PM Lee expressed confidence in Shanmugam and Balakrishnan 

In May 2023, Mr Jeyaretnam exposed the residency issue of Ministers Shanmugam and Dr Balakrishnan at No 26 and No 31 Ridout Road, drawing attention to potential conflicts of interest due to Shanmugam’s role as Minister of Law influencing the SLA.

This sparked demands for a Commission of Inquiry (COI) to investigate the matter.

Despite public anticipation, PM Lee initiated an independent review led by Senior Minister Teo Chee Hean and CPIB into the Ridout Road situation.

In June, two reports were presented to Parliament — one by the Corrupt Practices Investigation Bureau (CPIB) and the other by SM Teo Chee Hean.

The Review established that the rental rates paid by both Ministers were “at fair market value and not below market valuation”, and “there was no evidence that the Ministers were given favourable rental rates due to their positions.”

Additionally, the review verified that the rental amounts were consistent with those of other properties in the surrounding area.

Concerning tenancy terms, the report emphasized that the terms granted to both ministers align with the policies set by the SLA for the residential properties it oversees.

The Review noted that both 26 and 31 BWBs rented by the Ministers fall within the maximum allowable tenancy term of 3+3+3 years that the SLA can approve at any given time.

Notably, SLA considers various factors, including the anticipated expenditure on property improvements, when deciding whether to grant longer tenancies, the Review reported.

This approach is taken because all approved improvements made by tenants become government property upon return, and a lengthier tenure allows for the gradual amortization of such expenses over an extended period.

In the case of 26 Ridout Road, SLA factored in that Mrs Shanmugam committed to undertaking improvement works exceeding S$400,000. Similarly, for 31 Ridout Road, Dr Balakrishnan’s wife committed to executing works totalling more than S$200,000.

The inquiry cleared any misconduct in the rental of Ridout Road properties before a parliamentary debate in July 2023.

PM Lee later in the House firmly expressed his unwavering confidence in Ministers K. Shanmugam and Vivian Balakrishnan, stating that as long as the rental process is conducted properly and all procedures are adhered to, there is no wrongdoing.

“Ministers in Singapore are paid a clean wage – realistic, competitive, but clean. Therefore, where ministers decide to live, whether they want to rent, whether they want to buy, these are personal choices,” PM Lee said at the time.

SM Teo stressed the underlying issue of equity and fairness. He spoke on the importance of a clean government, upholding integrity among those in public service, and the PAP’s commitment to building an inclusive and progressive society.