SINGAPORE: The Corrupt Practices Investigation Bureau (CPIB) announced today (28 June) that it found no evidence of corruption or criminal wrongdoing in the rentals of two bungalows at Ridout Road by Law and Home Affairs Minister K Shanmugam and Foreign Affairs Minister Vivian Balakrishnan.
The fact that CPIB was investigating this case was only publicly disclosed today, and CPIB said that the probe was ordered by Prime Minister Lee Hsien Loong, who subsequently presented the CPIB’s findings to Parliament along with a review report by Senior Minister Teo Chee Hean.
The CPIB’s report stated that no preferential treatment was given to the ministers or their spouses, and there was no disclosure of privileged information during the rental transactions involving the two black-and-white bungalows.
The bureau, which reports directly to the prime minister and possesses the necessary powers to investigate corruption, found no evidence of the ministers abusing their positions for personal gain.
However, the CPIB did discover a “lack of precision” in the Singapore Land Authority’s (SLA) use of the term “guide rent” in relation to 26 Ridout Road, which was rented by Minister Shanmugam, who serves as the Minister for Law and Home Affairs.
It deemed a previous statement made by the SLA on May 12, stating that Mr Shanmugam’s offer exceeded the guide rent, incorrect and clarified that the rental paid by Minister Shanmugam was equal to the correct guide rent for the property.
CPIB said that the lack of precision in the term “guide rent” was not due to any ill intent on the part of SLA officers involved, and there was no evidence of intentional abuse of position in the valuation process.
The Attorney-General’s Chambers (AGC) supported the findings and recommendations of the CPIB and directed that no further action be taken as the facts revealed no offences. Consequently, the investigation into the matter has been closed.
Senior Minister Teo’s separate report concluded that both ministers, public officers and private sector intermediaries involved conducted themselves appropriately in the two transactions. The report emphasized that no abuse of power or conflict of interest led to the ministers obtaining any unfair advantage or privilege.
The reports disclosed that Mr Shanmugam pays a monthly rental of $26,500 for 26 Ridout Road while Dr Balakrishnan paid $19,000-$20,000 to rent 31 Ridout Road. Both ministers reportedly forked hundreds of thousands out of their pockets to renovate the bungalows.
Regarding the specific properties, the reports noted that 26 Ridout Road had been vacant since December 2013, and Minister Shanmugam requested a list of available properties for rent in January 2017. The properties he visited displayed prominently “for lease” signs.
In January 2018, Minister Shanmugam engaged a property agent to represent him in the rental transaction. Despite being vacant for over four years without attracting any bids, Minister Shanmugam rented the property after expressing concerns about the adjacent overgrown vegetation, which posed potential risks.
The Singapore Land Authority (SLA) fenced the adjacent land within the property boundary and incurred costs, which were later recovered from Minister Shanmugam’s rent. The SLA also undertook essential repair works for the property, and Minister Shanmugam paid $61,400 for a car porch and over $400,000 for improvement works not covered by the SLA’s restoration efforts.
The tenancy agreement for 3+3+3 years was signed in June 2018 and renewed for a second term in June 2021.
As for 31 Ridout Road, the property had been vacant for five years before unsuccessful bids were made below the prevailing guide rent.
Mrs Joy Balakrishnan, the wife of Dr Balakrishnan, noticed a “for lease” sign and contacted the SLA’s managing agent. The lease proposal was accepted as the final secured rent of $19,000 was not below the prevailing guide rent.
Mrs Balakrishnan committed to undertaking improvement works, and the tenancy agreement for 3+2+2 years was signed in October 2019. A renewal was granted for another term of 3+2 years, with the rental adjusted to $20,000, considering market conditions in 2022.
Dr Balakrishnan paid over $200,000 for additional improvement works to the state property.
The review conducted by Senior Minister Teo highlighted that properties with low demand, like 26 and 31 Ridout Road, were leased out through direct tenancy. The report emphasized that Minister Shanmugam, being the Law Minister overseeing the SLA, took appropriate steps to eliminate any potential conflict of interest.
He removed himself from the chain of command and decision-making process related to the rental of 26 Ridout Road, informing the relevant authorities of his recusal. Senior Minister of State for Law Indranee Rajah handled all the matters related to the rental transaction, and no matters were raised before Mr Shanmugam.
In the case of 31 Ridout Road, there was no conflict of interest as Minister Balakrishnan’s responsibilities do not include the SLA.
The CPIB also noted that no preferential treatment was given during the rental process, and the availability of both properties was made known to the public. The rental rates were comparable to other similar properties, taking into account the condition and market conditions at the time.
The report concluded by highlighting the importance of upholding integrity in the actions of political officeholders and public service officers. It emphasized the need for strong values and constant efforts to maintain high standards of integrity and accountability in Singapore’s government and society as a whole.
Prime Minister Lee Hsien Loong has accepted the two reports and instructed that they be published and tabled in Parliament as a miscellaneous paper. The relevant parliamentary questions regarding the issue will be addressed next Monday.