New town council code of governance will promote transparency: MND
Governance code that kicks in April next year will promote transparency, says MND
Town councils (TCs) will have a new code of governance from April next year, the Ministry of National Development (MND) said in a statement yesterday.
The new code aims to promote greater transparency and raise governance standards of TCs. Based on five guiding principles - integrity, objectivity, accountability, fairness and transparency - the code lays out best practices TCs are encouraged to adopt.
These practices include ensuring a comprehensive town council plan for the TC to achieve its goals, and ensuring there are adequate resources allocated to support the plan.
TCs will need to have a performance evaluation system for all vendors and managing agents, and an internal audit function - undertaken in-house or outsourced - to assess its internal controls and procedures.
These practices span four domains: council effectiveness, internal controls and processes, financial management and vendor management.
Collectively, the 16 TCs manage about $2 billion worth of public and residents' monies.
"As public institutions entrusted with significant amounts of public funds, TCs should have good governance and management controls in place to remain transparent and accountable to residents," the statement said.
The MND has sought to introduce more robust governance standards while being mindful of the cost of compliance and the differences in operating circumstances across TCs.
To facilitate TCs declaring compliance with the code, MND has issued a checklist for TCs to submit to the ministry annually. The first declaration for the 2020 financial year will be due in September 2021.
The ministry worked with consultant Ernst & Young Advisory as well as an advisory panel comprising academics, governance experts and industry practitioners to draft the new code.
It also consulted the TCs last December and held a public consultation in April this year.
The new encouraged practices will operate through a comply-or-explain regime.
Where town councils opt not to comply or are in the process of working towards compliance with certain provisions, they will be required to provide meaningful explanations to MND on how the governance standards in the Code are achieved.
Other guidelines provided by the code include having a data governance and information security framework to secure its information assets, as well as an incident management plan to respond promptly to security incidents.
The new code caps the changes to the Town Councils Act, whose review was first mooted in 2013 and came about after furious debates in parliament over the running of TCs, after the Workers' Party took over running Aljunied GRC from the People's Action Party after the 2011 polls.
Five town councillors from the Aljunied-Hougang Town Council were subsequently alleged to have breached their fiduciary duties in two ongoing multi-million dollar lawsuits.
In March this year, former Ang Mo Kio Town Council general manager Wong Chee Meng pleaded guilty to accepting bribes to advance the business interests of two companies the town council did not work with.