Ministry officers will have to declare access to privileged information before renting govt properties: SM Teo

SINGAPORE: Officers in government ministries and statutory boards with access to privileged information and influence on decisions will soon have to make a declaration before they can rent government properties managed by their agencies. 

Speaking on the matter of the rental of the 26 and 31 Ridout Road state properties in parliament on Monday (Jul 3), Senior Minister Teo Chee Hean said that the Public Service Division will work with the ministries and statutory boards to introduce a standard declaration requirement for selected groups of officers. 

These officers include those who have access to, or are involved in leasing and valuation matters, he said. 

“Officers in these organisations who have access to privileged information and/or can influence the outcomes of decisions will have to make a declaration before they can rent government properties managed by their agencies,” said Mr Teo. 

The officer will have to declare that they have taken “adequate steps” to prevent any conflict of interest, he added. For example, they can recuse themselves from overseeing or processing the transaction. 

These properties will include commercial and residential state properties such as black-and-white bungalows, terraces, factory or office spaces, business parks, shops in neighbourhood centres, hawker and market stalls, said Mr Teo. 

The Prime Minister will review the declarations required for property transactions for ministers and Members of Parliament from the People’s Action Party.

In May, it came to light that Law and Home Affairs Minister K Shanmugam and Foreign Affairs Minister Vivian Balakrishnan had rented the black-and-white bungalows at 26 and 31 Ridout Road respectively. 

Interest in the matter arose after opposition politician and Reform Party chief Kenneth Jeyaretnam questioned if the ministers were "paying less than the fair market value".

SLA, which rented out the Ridout Road state properties, is overseen by the Law Ministry, which is helmed by Mr Shanmugam and Second Minister for Law Edwin Tong.

On May 23, Mr Shanmugam and Dr Balakrishnan called for an independent review. Prime Minister Lee Hsien Loong also called on the Corrupt Practices Investigation Bureau (CPIB) to investigate the matter. 

Investigations by the CPIB did not find evidence of criminal wrongdoing or preferential treatment given to Mr Shanmugam and Dr Balakrishnan, it said in a report on Jun 28.

There was also no disclosure of privileged information in the process of the rental transactions, and no evidence to suggest any abuse of position by the ministers for personal gain, said CPIB in the report.

In his ministerial statement in parliament on Monday, Mr Teo stressed the significance of Mr Lee’s request for CPIB’s involvement, since the agency reports directly to the Prime Minister, and can even go directly to the President if they are stopped by the Prime Minister from investigating a possible crime. 

“There is no more thorough, persistent, and I dare say even fearsome investigative body in Singapore,” said Mr Teo.

“That the Prime Minister did not hesitate to call the CPIB in to investigate two senior ministers is a signal how seriously we take such matters of incorruptibility, and its absolute value in our system.”

VALUER DID NOT KNOW IDENTITY OF TENANT AT 26 RIDOUT ROAD

Mr Teo said again on Monday that both ministers, as well as the public officers and private sector intermediaries involved, had conducted themselves properly in the rental transactions and that there was no abuse of power or conflict of interest resulting in the ministers gaining any unfair advantage or privileges. 

The process of renting out the two properties did not deviate from the prevailing SLA guidelines and approaches in renting out black-and-white bungalows for residential purposes, he added.

In particular, the guide rents were not revealed to Mr Shanmugam and his agent nor to Dr and Mrs Balakrishnan, Mr Teo noted.

The guide rent is the “reserve rental based on market rates as determined by qualified valuers”, SLA told CNA previously. 

The SLA valuer who reviewed the guide rent of 26 Ridout Road after the plot was enlarged did not know the identity of the prospective tenant, and only learnt that the tenant was Mr Shanmugam after the matter was reported in the media, said Mr Teo on Monday. 

They also did not know about the rental amount that SLA's leasing division had negotiated with the tenant, he added. 

The Senior Minister noted that Mr Shanmugam initially offered a rental of S$25,000 (US$18,480) a month, based on his property agent's advice.

Mr Shanmugam also instructed the agent that he should not be paying less than his neighbours. 

A neighbouring unit was tenanted at S$26,000. SLA proposed a rental of S$26,500, and Mr Shanmugam agreed to this, said Mr Teo. 

"This episode demonstrates the paramount importance of maintaining high standards of integrity and accountability in the government and nationally," said the Senior Minister. 

In his ministerial statement, Mr Teo also addressed his involvement in the matter. 

There would have been an actual conflict of interest if Mr Shanmugam made decisions that affect his rental of 26 Ridout Road, since the Law Ministry oversees SLA, reiterated Mr Teo on Monday. 

But in Mr Shanmugam’s case, the Law and Home Affairs Minister had informed the then-deputy secretary of the Ministry of Law that he would recuse himself from any discussion related to the rental of the property.

He also instructed the then-deputy secretary to approach then-Senior Minister of State for Law Indranee Rajah if any matter related to the property had to be referred to the minister. Mr Shanmugam then informed Mr Teo that if the matter had to go beyond Ms Indranee, she would approach Mr Teo.

SLA said earlier in May that Mr Shanmugam had notified a senior Cabinet colleague that he was making a bid for the property. 

In the end, there was no matter raised by the Singapore Land Authority (SLA) to the Law Ministry during the entire rental process, said CPIB in its report.

Mr Teo noted again on Monday that Mr Shanmugam had recognised the potential conflict of interest, declared it to himself, and took “effective steps” to eliminate the potential conflict of interest. 

“I wish also to state that as no matters were raised to me regarding any aspect of the rental transaction, I am not an involved party in the rental process,” he added. 

The Attorney-General’s Chambers (AGC) has agreed with CPIB's findings and recommendations, the latter said in its report last week. 

AGC has directed that no further action be taken because "the facts do not disclose any offence", the report added. "The investigation into this matter is closed."