The clarification made by the Finance Ministry on the recent constitutional amendment of the transfer of reserves clarified absolutely nothing.
Deputy Prime Minister Lee Hsien Loong had told Parliament when he introduced the amendment that the Constitution had not allowed reserves to be transferred from the Government to government organizations and businesses without it being considered a draw on the reserves.
In other words, under the previous legislation, if the PAP wanted to transfer reserves from the Government to a GLC it would be considered a draw on the reserves and to draw on the reserves would require the consent of the president and, worse, the public would have to be informed.
In order to avoid making such transfers public knowledge and having to get presidential approval, Mr Lee had sought to change the meaning of the articles in the Constitution to allow such transfers to take place but not have them considered as a draw on the reserves.
It seems a very clever way of unlocking the safe. By saying that such a move to transfer reserves from the Government to a GLC would henceforth not be considered a draw on the reserves, the Government is now free to raid the reserves without getting consent from the president or making it public.
The intention, according to Mr Lee, is to enable the Government to restructure", "merge" or "corporatise government organizations and businesses. In other words the Government wants to draw on our reserves to do business without telling us.
The questions still remain:
- With such secret and unchecked movement of the reserves from the Government to statutory boards and GLCs, what is there to prevent abuse and misuse of the funds belonging to Singaporeans?
- Is there any provision to ensure that failed businesses are not bailed out?
- Is there a limit as to how much funds can be transferred to any one entity?
- Who will make the decision to sanction a transfer and to which company?
The amendment gives the Government absolute freedom to do as it pleases. Without a set of clearly defined criteria and a transparent system to ensure that rules and regulations are adhered to, we are looking for trouble - which may not be too hard to find.
Instead of making the system more transparent and accountable in line with global practices under WTO rules, the latest amendment will shield the public even more from the Governments financial dealings.
Not only must Singaporeans be warned of such a dangerous move but foreign investors must also be made aware of the murky way in which the PAP handles corporate matters and seems to have every intention of making it even murkier.
Chee Soon Juan
Singapore Democratic Party
(12 May 2004)