The stage has been set for the mother of all whitewashes in Parliament on Monday when the people who were the subject of the investigation (Balakrishnan and Shanmugam) and the person who approved their rental of the Ridout Road properties (Teo Chee Hean) will issue statements and answer questions. So they are using the resources of their Ministries (this applies to Shanmugam in particular) that they were accused of misusing in the first place? Isn’t this in itself a breach of the Ministerial Code?

None of the questions I raised in my previous blog have been answered. In particular why was Teo Chee Hean appointed by PM Lee to conduct the review when he has a material interest in the outcome of that review? If any wrongdoing had been found he would at the very least be on the hook for negligence in having given the nod to the surreptitious rentals of state properties in the first place. Surely if a police officer might be implicated in a potential crime then you don’t ask the police officer to investigate it? Isn’t that Governance and Conflict of Interest 101?

The report only raises more questions than it answers and the report is far from conclusive. As I said before why were the previous tenants squeezed out with onerous conditions such as having to pay for termite infestations themselves and then the properties were left vacant for four years. Why was SLA prepared to spend $515,000 on “essential’ repairs at 26 when Shanmugam wanted to rent the property but not before with the previous tenants? Why was it allowed to happen that two prime properties were allowed to remain vacant for so long and deteriorate? It appears that Shanmugam had an advantage not available to other tenants. Also the fact that Shanmugam was himself interested in renting the property sets up a conflict of interest with his duty as Minister of Law in charge of SLA to get the best value for the taxpayer and to manage the land so as to achieve the maximum value. Lee Kuan Yew lectured Chiam See Tong on the fact that land had a value and was part of the reserves, a point also rammed home by Indranee Rajah and Desmond Lee when they lectured Leong Mun Wai.

The Ministerial Code of Conduct of 1954 states: “a minister must scrupulously avoid any actual or apparent conflict of interest between his official responsibilities and his private financial interests”.The manner of the inquiry and report and the ministers involved only aggravates the apparent conflict of interest. It has been handled poorly from the start in a manner which seems intended to deceive rather than clarify.

First there is the matter of Shanmugam failing to declare his interest in April 2022 when asked a question in the House by Leong Mun Wai about the rental rates for Black and White bungalows. Surely this is a cut-and-dried breach of the Ministerial Code not to declare that he had a financial interest. I can remember that my father, JBJ, was referred to the Committee of Privileges and fined for allegedly failing to declare his pecuniary interest when asking a question in Parliament on behalf of a client. Why is it always one law for the MIW and another for everyone else?
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When I first exposed the matter he again failed to make an adequate account. SLA made a statement on his behalf and referred only to a senior colleague . Again this was a concerted effort to deceive the public through omission. It turns out that the senior colleague was Teo Chee Hean and we learnt this through a report written by Teo Chee Hean himself. How can he write a report about his own conduct? Clearly his advice was wrong. The only advice should have been- don’t do this. The code makes it clear that you should step away from SLA properties because of the appearance of a conflict of interest

So the report is itself an abuse of power and therefore a conflict. It is, as I say above, a minister using his power to defend himself.

Next the report fudges key issues. It fails to give a detailed comparison of land sizes. It fails to give the rent details of comparable properties. It presents invalid comparisons , by for example comparing rents for properties on much smaller plots of land with 26 and 31 Ridout and then saying the rents were in line with those. It confuses built up area with gross land area. But it cannot avoid showing that rentals for state properties are much lower than for private properties and thus that SLA is mismanaging our land resources.

The issue of how Shanmugam and Balakrishnan came to be aware of the vacancies and their supposed arms-length negotiations with SLA seem to be an after the event fabrication as well. The report says that in 2017 “Mr Shanmugam asked the then deputy secretary (DS) at the Ministry of Law (MinLaw) for a list of a few properties available to the public to rent” Surely this was another abuse of power. What ordinary potential tenant is able to speak to the dep sec at MinLaw? Isn’t it corrupt to make use of the resources of your own Ministry for your own benefit, financial or otherwise? Similarly with the tour of the properties. Was this arranged by SLA for Shanmugam’s benefit? Was a similar tour available to other prospective tenants? The report says that “For Lease” signs were displayed at both properties. Yet the details for 26 were missing from the SPIO website. SLA has said this is because it didn’t want to “cannibalize” the rents for other Black and White bungalows. But to members of the public it looks very like a deliberate decision not to advertise them widely and not to get the best value for the Singaporean taxpayer.

A big deal has been made of the guide price. The bids offered were mysteriously accurately right on the guide price. How did his bid match the guide price exactly? Even the CPIB report remarks on the fact without however drawing any conclusions. He also managed to acquire a neighbouring parcel of land.
All in all SLA spent over S$687,400 on Shanmugam’s property and S$570,500 on Vivian’s.
One was given 8 yrs and another 9 yrs lease. What ordinarily person renting these would dare to imagine that SLA would spend those sums and give them an unsecured lease with a locked in rent rate for almost a decade . Do t forget that current rents have shot up and ordinary Singaporeans are seeing rent increases of up to 70% and increases in cost of living in every area of their lives.

What is very clear is that SLA has been failing for years to maintain the land or the properties. And responsibility for that failure must rest at Shanmugam’s door. This failure to achieve best value for the taxpayer with huge tracts of state land has to be contrasted with the PAP Government’s relentless drive to push HDB prices skyward and then divert huge sums from the Budget into the reserves on the pretext of “subsidising” Singaporeans.

Then there is the ridiculous farce of Shanmugam “recusing” himself from the bidding. It must have been apparent from the start that Shanmugam was bidding since the report itself states that he asked about the additional parcel of land adjoining his property and that it placed the inhabitants of 26 in potential danger from snakes and mosquitoes. The only proper way to recuse himself would have been to not make a bid as his position as minister overseeing SLA obviously made it highly inappropriate. What tenant other than the Minister in charge of SLA would have had the power to demand that a huge tract of land adjoining his property be cleared and incorporated into his domain? The rental for this additional piece of land should surely have been at least as much as the guide rent of $24,500 per month for 26 alone. Definitely not a mere $2,000 per month which was only charged to cover the upkeep of the additional land alone with the cost of the greenery clearance essentially written off by SLA. The whole issue of how he got an extra parcel of land included with his property is very wrong.He’s supposed to guard the land as a state asset for the people and as overseer of SLA he shouldn’t have been set on acquiring more for himself and for 9 years minimum. In fact if I hadn’t raised this I’m sure Shanmugam. and Balakrishnan would have continued occupying their feudal estates for the rest of their lives or at least till they retired and the rent would probably have remained the same.

The report also failed to address the question of whether permissions were obtained to clear huge areas of greenery including ancient trees in a conservation area. Also no planning permission seems to have been obtained for the considerable enlargement of the swimming pool at 26 despite URA’s guidelines (which appear to have been removed) stating that it’s. required.

Reading the Ministerial Code again I don’t see how Shanmugam in particular, but also Balakrishnam can have failed to breach it. To recap:

A Minister must scrupulously avoid any actual or apparent conflict of interest between his office and his private financial interests. Such a conflict, or a perception of conflict, can arise
(a) from the exercise of powers or influence in a way that benefits or may be seen to benefit private interests held; or

(b) from using special knowledge acquired in the course of his activities as Minister to bring benefit or avoid loss (or could arouse reasonable suspicion of this) in relation to his private financial interests

How has the Code not been breached here and how is there not reasonable suspicion that the Minister didn’t use special knowledge acquired in the course of his activities?

In summary therefore:

1. The report is not independent. Teo Chee Hean is allowed to sit in judgement on his own actions.
2. There has been an abuse of power and a subsequent attempt at cover-up.
3. There is further impropriety in allowing ministers to make statements defending themselves especially as Shan says he recused himself as a minister
4. There is Important information missing
5. Invalid comparisons have been used to deceive you.
6. No explanation of why the Ministers needed to rent in the first place when they owned other magnificent properties or could rent from private landlords. I have suggested an arbitrage profit from letting out their own places and pocketing the difference. This alone would give Shanmugam a vested interest in the undervaluation of state properties and the decision to allow 26 and 31 to remain vacant and deteriorate which is completely at odds with his duty under the Ministerial Code.

It’s unfortunately not in doubt that this report will be overwhelmingly approved by Parliament on Monday with perhaps a standing ovation from PAP colleagues for Shanmugam, Balakrishnan and Teo Chee Hean for being jolly good fellows and men of the utmost integrity. It will be up to Singaporeans to give their verdict on Ridoutgate and whether the Ministers have breached the Ministerial Code. In particular will they allow the PAP to get away with their mantra of “Ownself investigates ownself and finds that ownself did nothing wrong” and make monkeys of them.

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