The real question is why PUB needs to make these ‘investments’ in the first question

I note that Second Finance Minister Lawrence Wong has chided the Workers’ Party (WP) for misunderstanding “basic accounting fundamentals” by querying why there is a need for the Public Utilities Board (PUB) to increase the price of water. According to reports, he said:

“PUB invests most of its capital reserve in property, plant and equipment (PPE) — such as the upgrading of waterworks, expanding water reclamation plants and investments in water treatment, said Mr Wong. The increase in capital reserve must be seen in conjunction with the agency’s growing asset base, said the minister, pointing to how its PPE account had grown from S$3.9 billion to S$7.1 billion over the same time period.”

This is in response to MP for Holland-Bukit Timah GRC, Liang Eng Hwa’s question to the Minister of Finance, asking if he will clarify the $5.3 billion of “Capital Reserves” in PUB’s accounts and whether this represents surplus funds that are at the disposal of the Government or PUB.

What Mr Wong doesn’t appear to have addressed on behalf of the Finance Minister, is why there was a need to increase its PPE by so much in the first place? Is the PUB investing correctly and efficiently? What are the investments they have made and why? Are Singaporeans benefiting from the PPE increase?

Secondly, had the WP not raised the question, would this issue of PPE increase even be explained to the public? Mr Pritnam has noted that he had earlier raised the topic of PUB’s capital reserve in his speech at the President’s Address in May, but his point was not discussed at the debate back then.

“the question of the quantum of the surpluses and the prospect of alternate revenue streams and future surpluses of many Government-Linked Companies and statutory boards to better cushion price hikes on Singaporeans needs to be looked at very closely and debated before prices go up. For example on the 30% water hike, how do future capital investments in water supply and transmission cohere with the large capital reserves of the national water agency which have increased consistently from around $3b in 2007 to more than $5b in 2016?” - Pritam Singh in his May speech

The opposition parties have a duty to question policies and shine spotlights on areas where explanations are needed. In turn, it is the duty of the government to account and be transparent. It seems odd that Lawrence Wong is chiding the WP for doing their job. The point Wong has failed to address is why the PPE needs to be increased in the first place. Instead, he has chosen to evade the real question by trying to make the WP look stupid. The issue here is not accounting fundamentals. Rather it is why such investments have to be made and whether too much has been spent on PPE.

Wong has lamented that the capital reserves are insufficient to cover PUB’s investments. Why then is the PUB making investments that it cannot afford?

Financial commenter, Chris Kuan has written that while WP got it wrong but he would have asked for the projected expenditure to see if PUB’s Capital Reserve is overfunded.

Again, there are many unanswered questions. Perhaps the PAP ministers are so used to doing things without the need for explanation or justification that they appear defensive in the face of any question. I think it is pretty obvious that the heart of the matter is why the 30% hike in water was necessary. It is disappointing that Wong has chosen to chide the WP for misunderstanding accounting fundamentals instead of dealing with the real question.

Is it a case that Wong just doesn’t understand the questions of the public or is he trying to deflect from answering the question?

 

by Ghui

 

 

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12 Responses to “The real question is why PUB needs to make these ‘investments’ in the first question”

  • rukidding:

    A case of “I ask you to sit”….you “better sit”

    A case of “I ask you to keep quiet”…you “better keep quiet” !

    Afterall,….you,people are already “labelled” dafts by them .

    Thats why their “arrogance” shows !

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  • I Know:

    The answer is very obvious: To support a population of 6.9 million. But zero cost to PUB/govt coz price hike(s) will make sure all costs will be fully recovered.

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  • old man:

    Why must this idiot chided WP whenever they asked a question? Why sort of Minister that talks with such draconian style instead of answering it. Wait till you become an opposition to face the same situation but I don’t think WP members would behave like them if voted into the house. I need to know too why the 30% increase in water cost etc….everything seems to be increasing.

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  • oute:

    Every MP are to ask questions of why and how the monies are being spend..

    If not, if they vote for the budget, they are also responsible if there is any discrepancy..

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  • N.Jungne:

    If SInkapoo did not up water tax by 30%, you think Tun M will skin the cat?

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  • Amazing!!:

    The PAP govt appears determined to make itself look
    stupid and raise suspicions that it is dishonest,
    going by what it does and its “explanations” for its
    deeds. Intriguingly, it Refuses to account for what
    it does! Is it trying to get voted out in the next
    election? Surely it can’t be as inept as it portrays
    itself to be? Its leaders all talk like blur kings!!
    Are they really as dumb and uninformed as their
    pronouncements/claims indicate? Can they really be
    so unaware of the awful image they give themselves?
    This is truly painful, esp for its supporters, who
    look like fools for backing them!!

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  • Never Trust A Thief:

    old man:
    Why must this idiot chided WP whenever they asked a question? Why sort of Minister that talks with such draconian style instead of answering it. Wait till you become an opposition to face the same situation but I don’t think WP members would behave like them if voted into the house. I need to know too why the 30% increase in water cost etc….everything seems to be increasing.

    A big fuss is made to deter future questions.
    When such things happened, it means that there is more than meets the eye, obviously there is something to hide.

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  • UniQ:

    Whatever that FUG face say ???

    Whoever is going to vote him in during the next GE, RC or not MUST BE SLEEPING WITH THE DEVIL HIMSELF OR MAYBE COPULATE TOO TO COME OUT THIS MOTHER OF ALL EVIL CHILD.

    LOLOLOLOLOLOLOL……

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  • oxygen:

    LAWRENCE WONG IS AN ECONOMIST, not an accountant, he should have illuminated- with reference to capital efficiency of invested capital investment instead of waving flag around with fundamental accounting application.

    Is the technology used currently outdated and overly expensive to operate, thus higher costs and more expensively priced to consumers?

    DID HE ANSWER THIS PROBE FROM WP?

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  • HarderTruths:

    Pappies – enough talk. Give us the numbers so we can hold you accountable – we are not stupid.

    That is your real fear – that the real numbers will show you have been doing a Najib all along….

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  • PAP Tekan by Mahatir:

    forget it the 70% will forever be dafts…

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  • Michael:

    Lawrence just another cronies serving the pap interest look at his arrogant

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