Oversight of Singapore's Defence Budget

Dr Lim Wee Kiak asked the Minister for Defence in view of Transparency International's Government Defence Anti-Corruption Index which gives Singapore a poor rating, whether Singapore's defence budget oversight and procurement processes are sufficiently robust.

Madam, Singapore and its various Government Ministries and agencies have achieved a reputation for zero tolerance against corruption for many years. For MINDEF, we have strict procedures to ensure that our procurement systems adhere to the highest and most rigorous standards and I think defence experts acknowledge this. For example, credible defence journals, such as Jane's Defence Weekly and Jane's Defence Industry, have acknowledged our robust and comprehensive system for procurement. The Financial Times also noted the "stringency and transparency" of our processes while the Aviation Week publication lauded Singapore's Defence Ministry as a "reference customer" and a "model of cost-effectiveness" to suppliers and buyers of defence equipment.

Among global defence companies, it is common knowledge that MINDEF buys equipment at very competitive prices and has stringent standards of performance for its purchases.

So, the difference between MINDEF's hard-earned and well-known reputation of being stringent, transparent and cost-effective in our procurement practices, and that of Transparency International's defence corruption risk reports which place us in the same category as countries like Afghanistan and Iraq, point to a credibility gap of Transparency International's reports.

We examined Transparency International's assessment and found their assumptions to be flawed and processes weak. For example, Transparency International (TI) stated that while there is "no evidence of illicit economic activity", they further went on to add "we may assume some off-budget allocations, perhaps on a limited basis". I do not know what is the basis of that assumption, but it is a very, very serious allegation.

Further, the evaluator, a person called Mr David Fouquet, added that he has "on good personal authority" that there was a phantom employee on MINDEF's payroll, without giving any details. We would suggest to TI that their processes need to be strengthened by relying on more authoritative sources and substantiated facts. In fact, Transparency International's analysis seems to be

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based mainly on Internet sources. We have endeavoured to reach out to this organisation to give them more information but they have flatly declined our offers of more information to debunk their false assertions.

TI also asserts that "parliamentary and legislature process to scrutinise the defence budget is not robust due to a lack of opposition voices in the political system". This is a rehash of old debates that if Singapore does not conform closely to their model of parliamentary democracy, we must be corrupt. TI's reports do injustice to our Members of Parliament here and ignore the strong legislative oversight as well as strong executive controls in our system.

The Defence Budget is presented and passed by Parliament and approved by the President each year. The Parliament appoints a Select Committee, the Public Accounts Committee (PAC), to work closely with the Auditor-General's Office to conduct regular scrutiny of our expenditure and accounts. This is further complemented by strong executive oversight. We have a robust system of checks and balances, an independent Auditor-General who reports to the President and a clean Civil Service. Detailed information on our anti-corruption, budget, audit and procurement checks and balances are available on public sites.

In fact, more established publications, such as the Asian Intelligence Report by the Political & Economic Risk Consultancy Limited, consistently ranked Singapore as the least corrupt country in Asia since 2002. Other reputable publications, such as the Governance Matters report published by the World Bank Institute, has also consistently ranked Singapore in the top fifth percentile out of over 200 countries in the area of Control of Corruption. The findings from this Governance Matters report are drawn from over 20 different indicators, some of which include reputable sources, such as the Economist Intelligence Unit and the World Competitiveness Yearbook by the renowned Swiss-based International Institute for Management Development.

Indeed, TI's Headquarters' most recent Corruption Perception Index 2013 placed Singapore as the fifth least corrupt nation in the world. The fact that the same organisation, albeit through two different publications, gives us quite different assessment, again calls into question TI's credibility.

My Ministry reiterates that we are committed to upholding Singapore's reputation as a country that is clean, honest and trustworthy, and a Ministry which emphasises the highest levels of integrity and incorruptibility.

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Mdm Speaker, I would like to thank the Minister for his reply. I would like to ask the Minister two supplementary questions. First, within the TI's website, it was mentioned that based on their methodology, there are 77 questions and apart from the evaluators, they are also peer reviewed two times, and they invited the governments to review their draft reports. I would like to ask the Minister whether we were invited to view the draft report before they published this. Secondly, this is not the first time an organisation has accused the Singapore Government of having very poor transparency in terms of our defence procurements. What is MINDEF doing now to further improve that perception or to correct that perception?

Mdm Speaker, yes, TI does engage with us and there have been instances where we offer and we want to give them information. Sometimes, they have accepted but, as I have said, in this particular instance, they did not. Dr Lim Wee Kiak said this is not the first time that MINDEF or the SAF had been accused of not being completely open about our processes. I agree with him. For instance, one of the reasons for TI's ranking us in the category as it did was, I quote, "no information exists on asset disposal or any scrutiny that may be subjected". In other words, I must tell you what I am disposing, but in order for me to tell you what I am disposing, you will know what I have. Or that "the percentage of defence expenditure allocated to secret items is not known publicly". Well, that is the reason why I do not tell you.

So, I think there is a difference in form in terms of what they want. We are not about to compromise our security by revealing the exact dollars and cents for each thing that we purchase. I come to this House; we tell you what we are going to purchase as I did with the Aster 30 systems, upgrading our submarines, that we are looking seriously at certain aircraft platforms. But it has not been our habit to publicly announce the minutiae because we take that stance to make sure that it gives us a more robust security system in the SAF.