I sent this letter to the Editor of TODAY yesterday in response to their misleading report about the IMF loan appeal published on 10 April. However I still have yet to receive even an acknowledgement so I reproduce the text of  the letter below:

18A Smith Street
Singapore 054932

13th April 2013

The Editor
TODAY

Dear Sir,

I refer to the report on my appeal against the judgement denying me leave to apply for a prohibiting order in the matter of the government’s $5 billion loan commitment to the IMF, published in your newspaper on 10 April 2013.

This is an important case, the outcome of which will determine whether our citizens can enjoy the protection of rule of law and an executive bound by the Constitution. Whatever the outcome I feel it is essential that your newspaper or indeed any State media, report on the case as accurately as possible.

Your reporter Ms. Lee did approach me after the appeal to ask for a written transcript of my oral arguments. Unfortunately I did not have a transcript as my arguments were oral and not read out from a script. However I did speak to Ms. Lee on the phone later and gave her the gist of my arguments. I also sent her links to the written authorities that I had relied upon in the Supreme Court. As my oral argument had taken over an hour and I also orally rebutted several of the AG’s claims I can fully appreciate that it may have been difficult to summarise them in the limited space available.

Unfortunately upon reading the article published in Today it seems that Ms. Lee’s presentation of my argument is based only on the earlier written submissions of 28 January 2013 and does not reflect the oral arguments I actually used in court.

Unfortunately whilst I am sure this was not the intention it has produced a report of the proceedings, which is fundamentally inaccurate and misleading. Worse, it puts arguments into my mouth which I did not actually present.
This was a complex case and even Deputy Public Prosecutor (DPP) Aurill Kam requested that my authorities be excluded on the grounds that they required specialized accounting knowledge. Maybe you will allow me to clarify.

Your report says, “Mr Jeyaretnam, who represented himself in the Court of Appeal yesterday,”

It is true that I represented myself. This becomes meaningful only when you know that I felt obliged to take this course of action because of the Law Society’s previous embroilment of my counsel Mr. M. Ravi. This affected the hearing of my first application in the High Court and I could not afford the possibility that this would happen again at the appeal in the Supreme Court. As my lawyer had settled matters with the Law society by April 8th, we did apply to have him re-instated at the hearing but this was rejected.

You say, “Yesterday, Mr Jeyaretnam maintained that the Government had given a guarantee, but Deputy Public Prosecutor(DPP) Aurill Kam argued that the guarantee contemplated in Section 38 of the MAS Act is a guarantee by the Government to cover “moneys due by” the MAS.”

My arguments were based on the fact that the MAS is a government company as defined in Schedule 5 of the Constitution and that the loan commitment had been given at the behest of the government. In any case, under the MAS Act, MAS is manager of the government’s reserves and not the owner of them. I pointed out that this is identical to the UK where HM Treasury made the loan commitment to the IMF, even though the Bank of England manages the country’s reserves.

You say, “But his application was dismissed last October by High Court judge Justice Tan Lee Meng, who ruled that this article only applied “when the Government raises a loan or gives a guarantee, and not when it gives a loan”.

I argued strongly that the natural and ordinary meaning of the words strongly supports the interpretation that loans as well as guarantees required both Parliamentary and Presidential approval. The Interpretation Act supports this.

However, even if one accepted that the giving of loans were not caught by Article 144 because loans were assets, I also argued and produced conclusive evidence from a variety of authoritative sources that as a loan commitment the IMF pledge should be treated as a contingent liability. Both loan commitments and guarantees are classed as lending-related commitments and contingent liabilities under US Generally Accepted Accounting Principles. The IMF loan commitment should thus be looked at as increasing the financial liability of the government.

I went on to point out that a loan commitment could be likened to writing an option to the IMF allowing them to borrow money from Singapore at a time that was advantageous to the IMF. This interpretation is supported by the accounting rules laid down by the US Financial Accounting Standards Board No. 133, Accounting for Derivative Instruments and Hedging Activities.

The practical effect of extending this commitment was that it was most likely to be drawn upon when the IMF had suffered losses and could not borrow elsewhere. I pointed out that the very term “firewall” used to describe the new commitment suggested that it was money that was to be “burnt” or sacrificed to prevent contagion spreading from, say, a banking collapse in the Euro Zone to the rest of the world’s financial system.

You say, “Mr Jeyaretnam also argued that he has standing as a Singapore citizen and taxpayer to bring forward the application”

It is entirely misleading to report that I argued that my locus standi was based on being a taxpayer and CPF holder. I brought up taxpayer status in an, “ If… then” argument.. My point was that if Madam Vellama had standing as a resident of Hougang to bring an action for judicial review of the PM’s unfettered discretion then I had as much right to bring an action as a taxpayer and CPF holder. I pointed out the inconsistency in Justice Tan’s ruling in my case and the court’s concession of standing in Vellama’s case. The conflict between these two rulings was pointed out in an article written by Tham Lijing in the Singapore Law Gazette in February 2013. The Law Gazette is the official publication of the Law Society (See here).

I also pointed out the contradictory nature of the court’s using a distinction between public and private rights as a test of standing. It is an unjustifiable simplification of my argument to say that it was based solely on my having standing as a citizen and taxpayer.

I would be grateful if you would print my letter as soon as possible.

Yours sincerely,

Kenneth Jeyaretnam

Published by kjeyaretnam

I'm a Singaporean economist who became an opposition activist. I blog to provide an alternative to the porkies that the Pinkies tell. It just so happens that my alternative is the truth. That's why I've never been sued in any civil or criminal court no matter how hard hitting my criticism. I'm quoted and interviewed and asked to speak across the world but largely censored in Singapore in an effort to silence my political opinions. The left hate me because they think I split their vote and because I eschew their outmoded economic models. Models that don't work. The Right and the Conservatives hate me because I'm a liberal. I'm not sure what the middle think of me. I don't think there are more than a handful of people in the middle, here in Singapore. I'm a Singaporean born and bred, dual heritage, my parents Singaporean established here before the State of Singapore was created. I'm not Eurasian. I read economics at Cambridge and could be broadly described as from the Keynesian school but I believe in interventions. I was formerly a successful hedge fund manager. After economics and politics my greatest interests are history, film and Makan. I run but I run so I can eat like a Singaporean. View all posts by kjeyaretnam