Singapore Ministers Face Questions Over Rentals

No impropriety found, but public is angered

Singapore’s austere, puritan government has run into a vexing political problem that has caught the public zeitgeist and won’t seem to die down. In May, it became known that Law and Home Affairs Minister K Shanmugam and Foreign Affairs Minister Vivian Balakrishnan are living in magnificent colonial-era bungalows on exclusive Ridout Road which are owned by the government and whose grounds were renovated at state expense.

The Singapore Land Authority (SLA), which rents out the properties, comes under the Law Ministry headed by Shanmugam although he maintained that he had rented the property through an agent in a hands-off transaction.

In a six-hour parliamentary session on July 3, both the government and the opposition ran rings around each other to point out that nobody had done anything wrong. Prime Minister Lee Hsien Loong said that an independent review of the rentals had been conducted after both ministers called for it and found nothing wrong. 

Balakrishnan and Shamugam on the pan

"Outrageous allegations were being made that ministers had enjoyed improper benefits and inside tracks, and were getting a sweet deal, and all sorts of very grave innuendos were being stated,” Lee was quoted on the floor of parliament Monday. “Now that the report has come out and all those grave suspicions have been dispelled, you focus on this question and you ask, should he have asked the deputy secretary? My view is, he could have done it a different way. He could have done it this way. He has given the House the reasons why he did it this way. I think those are cogent reasons, which I accept."

Indeed, although the legal t’s and procedural i’s appear to have been crossed and dotted, that hasn’t assuaged public irritation. The optics are awkward, in a city-state so crowded that everybody except the massively rich lives in a high-rise flat and where even the economic government-supplied flats, called Housing Development Board (HDB) flats, are getting expensive for many Singaporeans. According to reports, the property rented by Balakrishnan covers 136,101 sq ft – about the size of two standard-sized football fields. Shanmugam’s bungalow includes land from an adjacent property and totals 249,335 sq ft.

There are only about 500 such houses, known as “black-and-whites” for their characteristic combination of dark timber beams and whitewashed walls, in a city of 5.4 million people that is so crowded that the government has hauled in 130 sq km of sand from neighboring Malaysia, Indonesia, and Cambodia to bring its size to 744 sq km. The Lion City remains the world’s 20^th smallest country, ranking between Micronesia and Tonga.

Some 262 of these houses, once the homes of colonial panjandrums, judges, tycoons and timber and tin towkays, are now owned by the government. Competition to rent them is enormous, raising questions as to how two civil servants – albeit some of the best-paid civil servants on the planet – got into them.

Opposition leader Pritam Singh of the Workers’ Party, which was recently battered around the floor of parliament when one of its members was caught lying, quickly acknowledged there was no corruption or wrongdoing in the matter, as did other MPs in the opposition. Years of being browbeaten in parliament by leaders of the governing People’s Action Party (PAP) have made opposition members circumspect at best and timid usually. There were moves in the ruling PAP to force Pritam and other members of the Workers Party out of parliament over his party member’s misdeeds, making him even more cautious. Shanmugam was a particularly merciless interlocutor during the affair. 

Senior Minister Teo Chee Hean, who headed the independent review, repeatedly told the House there was no potential conflict of interest over the homes, given that Shanmugam had recused himself from any decision-making on his rental.

Shanmugam, who as a minister makes more than S$1 million (US$741,000) per year, put up a fierce defense, claiming he was actually losing out financially by renting the bungalow at S$26,500 per month, and having to make up the rent sum from renting out his own fully-owned Good Class Bungalow, bought when he was in private practice as a Senior Counsel at the law firm of Allen & Gledhill, earning more than what he does as a government minister now, plus, he said, tapping into his savings. 

“Based on my current income, I would not have offered to rent 26 Ridout Road. That is based on my personal approach to finances.” Rather, he said he had done it for family reasons. Shanmugam's annual rental cost for 26 Ridout Road works out to be just over S$310,000, perhaps third or less than his annual salary as a government minister.

'Total transparency'

Shanmugam said he made his choice so there was "total transparency" and that he and Senior Minister Teo Chee Hean, who conducted the review into the affair, also emphasized that the list of state properties available for rent is not privileged information or secret. Such lists, they said, are made available to "credible, prospective tenants" such as embassies, companies and businessmen.

"I could have approached SLA directly," Shanmugam said, according to local media. "But I asked the deputy secretary, a senior administrative service officer, so that (the Ministry of Law) knew and there was total transparency."

Teo said according to local media that it is in SLA's and the appointed managing agents' interests for state properties available for lease to be made known -- whether through the publicly accessible State Property Information Online (SPIO) portal, or other means such as a network of property agents. "(They) want to rent out these properties, so they want people to know about them," he said.

Teo cited an example of how in June 2019, the agency provided a list of more than 10 state properties up for lease in the form of a 22-page slide deck to a company looking to rent several properties for employees for its operations.

"This is not unusual, and it is not privileged information," Teo said, noting that the company did not need to pay SLA to get the list, contrary to Mr. Singh's assertion that individuals would have to go to considerable expense to access it.

Progress Singapore Party (PSP) Non-Constituency MP Leong Mun Wai also raised questions over whether the agency had offered other tenants of black-and-whites the same treatment as the two ministers, by paying hundreds of thousands of dollars for preparatory work and allowing them to construct swimming pools and cut down trees, for instance.

He also asked Lee if he would commit to applying the ministerial code of conduct more stringently. Lee said Leong was trying to play up the fact that some ministers live in properties like good class bungalows (GCBs).

"What he really means is, should I or should I not allow ministers to rent GCBs, or to rent 'black-and-whites'? My answer is, I do not object," he said. "(Ministers) live within their salary. They live within their means... They comply with the laws, they do things properly. And most importantly, they continue to do their duties as a minister and to serve their constituents and to serve Singaporeans and to make a contribution to my team," he added.

Second Minister for Law Edwin Tong said there are reported examples of SLA spending more than S$500,000 on maintaining and refurbishing other black-and-white properties.

Although Prime Minister Lee declared Shanmugam and Balakrishnan committed no wrong regarding their abodes, many Singaporeans have expressed unhappiness with this saga on social media and online chat groups.