A recent article by the Temasek Review News (TRN) made several erroneous claims, following a recent reply in Parliament by the Minister for Culture, Community and Youth Grace Fu pertaining to findings from the Auditor-General’s Office (AGO) on the National Gallery Singapore (NGS) development project.
Factually sets things straight:
1. Did the Auditor-General flag that $13 million was missing, as stated in the TRN article?
No, AGO did not indicate in its report that there were missing funds.
TRN’s false claim: "After being flagged for missing $13 million by the Auditor-General, Minister for Culture Grace Fu denied that there is any corruption or fraud involved."
Actual extract from AGO report: "AGO’s test checks revealed weaknesses such as waivers of contractual provisions involving $13 million without due scrutiny by MCCY."
MCCY has also reviewed AGO’s findings and is satisfied that there is no fraud involved in NGS’ waivers of contractual provisions.
2. What did the $13 million in the AGO report relate to then?
The $13 million was primarily waivers of amounts payable for additional time taken by the contractor to complete construction works. NGS had assessed that the requests for additional time were reasonable, considering the scale and complexity of the project. Thus they waived the amounts that the contractor would have needed to pay for the delay.
NGS managed the project according to industry best practices, as advised by the NGS’s Project Development Committee which comprised experts from the construction industry.
3. Did Minister Fu say that the "missing $13 million" is "normal"?
No. In her response in Parliament, Minister Fu did not use the word “normal”. Her response, in full, is as follows:
"The S$13 million) is actually waivers and also for variation orders, which are to be expected for a project that massive that involves two monuments and an extension connecting the two."
4. What will MCCY and NGS do to avoid this from occurring again in future?
The NGS Board and Audit Committee, which includes members of its Board with experience in accounting and audit matters, have completed their review of NGS’ procurement policies and processes arising from AGO’s findings. NGS has implemented improvements to its systems and procedures accordingly.
MCCY’s fifth and final audit has since resumed after being suspended due to the AGO audit. Arising from the AGO audit and MCCY’s final audit, MCCY will work with NGS to enhance financial processes and procurement policies. This will include rectifying any issues identified from these audit findings. Both MCCY and NGS take the proper use and management of public funds seriously, and will work together to enhance financial processes and procurement policies.