Two town councils invested in Lehman and Morgan Stanley.

[mattlock]

Who said town council cannot invest?

Who gave you the idea that town councils are so poor they have no extra cash? And if they have extra cash, they have to park somewhere, right? It's just in this case they chose a Minibond over a FD.

I wonder what will happen to the finance managers of these town councils though.

But is it morally acceptable to be taking the money that people HAVE to pay and using it to invest?
In such cases I thought the organisation should be focusing on putting the money in the safest place possible, and leaving the investing to the organisations that are specifically put together for investing purposes.

 

[coffee3in1]

But is it morally acceptable to be taking the money that people HAVE to pay and using it to invest?
In such cases I thought the organisation should be focusing on putting the money in the safest place possible, and leaving the investing to the organisations that are specifically put together for investing purposes.

Well said. I think there should be greater transparency into the funds held by public boards. What's the point of hoarding up precious resources and inflating the cost of living, only to have these resources blown.

 

[mattlock]

http://business.asiaone.com/Business/News/My+Money/Story/A1Story20081107-98963.html


If Town Councils want to invest money, then they have to be transparent about it because they can't use the reasoning the GIC gives that it needs the secrecy.

 

[blazer_workz]

But is it morally acceptable to be taking the money that people HAVE to pay and using it to invest?
In such cases I thought the organisation should be focusing on putting the money in the safest place possible, and leaving the investing to the organisations that are specifically put together for investing purposes.

Yes! very well said!
Before all these news, how many residents actually knows about this kind of investments made by the town council?
And what about the profits from investments? Is it being passed to the residents?

 

[Gunbucker]

Yes! very well said!
Before all these news, how many residents actually knows about this kind of investments made by the town council?
And what about the profits from investments? Is it being passed to the residents?

Guys, read the response from the town council. The Dr guy is already covering his backside by saying "we're operating based on the guidelines set" or something along those lines.

My guess is that this issue will be quickly swept aside from public view. The gahmen will then later take those responsible to the back of the house and give some serious a** whooping. That's pretty much the modus operandi I've seen so far.

 

[coffee3in1]

...
And what about the profits from investments? Is it being passed to the residents?

:think: i thot profits will be used to justify the high end luxury items like Bose sound systems and oak furniture in the chairman's office?

On a more serious note, I'm disgusted by those who use public money to try to prove their worth. If all goes well, they may get a promotion or pat on the back. Wanna be hero, then do it with their own dough!

 

[Henessy]

OMG. We are going to pay a lot more $$$ to town council as maintenance to cover the $12 million loss.

 

[Sion]

OMG. We are going to pay a lot more $$$ to town council as maintenance to cover the $12 million loss.

That may not be the case if council buys lottery and strikes $12 millions everything will be normal liao.

 

[Henessy]

That may not be the case if council buys lottery and strikes $12 millions everything will be normal liao.

Unless they have some internal lobang with singapore pools, I doubt it is that easy. Unless those who strike lottery are their khakis.

 

[waileong]

But is it morally acceptable to be taking the money that people HAVE to pay and using it to invest?
In such cases I thought the organisation should be focusing on putting the money in the safest place possible, and leaving the investing to the organisations that are specifically put together for investing purposes.

Morality has nothing to do with it. They don't have any moral obligations to you. There's only a legal obligation for them to maintain a state of cleanliness in your estate, and to perform the other functions expected (eg building improvements, etc) in return for the money you pay.

You have to understand, a town council is not a bank, the money you give to them is no longer your money, it's their money. unlike a bank deposit that still belongs to you after you give it to the bank. Because you pay them money for rendering a service. So as long as they render their service, they can do whatever they like with whatever leftover money after they pay their contractors.

 

[Gunbucker]

Morality has nothing to do with it. They don't have any moral obligations to you. There's only a legal obligation for them to maintain a state of cleanliness in your estate, and to perform the other functions expected (eg building improvements, etc) in return for the money you pay.

You have to understand, a town council is not a bank, the money you give to them is no longer your money, it's their money. unlike a bank deposit that still belongs to you after you give it to the bank. Because you pay them money for rendering a service. So as long as they render their service, they can do whatever they like with whatever leftover money after they pay their contractors.

Good point. In short, as long as their SLA (Service Level Agreement) to you as specified by the gahmen, they're fine.

The only time this little "folly" of theirs will come and haunt them, is when their services rendered become shoddy and fall short of standards (e.g., shoddy paint work etc), or when they start asking more money from residents.

All this said, there is still a matter of good governance. Given the volatility and complexity of the financial tools they invested in, are the guidelines set for town councils enough? Probably needs a re-look.

 

[Jango]

Town Councils falls under the broad category of Civil Service. Town Councils are not profit oriented organisations. Why are they collecting so much surplus from residents that the reserve is now in the BILLIONS? With such high surpluses why are residents still made to pay for HDB upgrading? Why are some HDB estates in such shieety state?

Those who live in condominiums will know what Sinking Funds are. They are made up of whatever maintenance fund is remaining. And depending on the size of the sinking fund, maintenance fees are adjusted accordingly. While these funds are managed by the committee council, the funds really belong to the residents. At AGMs, residents have every right to scrutinise the financial reports and question the committee council over every single cent spent. If a decision needs to be made on a substantial expenditure, a voting by the residents is carried out. The committee council has to observe majority ruling.

HDB conservancy fees works the same way doesn't it? It is used for the general upkeep of the HBDs and its surroundings. So similarly these reserves held by Town Councils really belongs to the residents, not the chairman or those so call advisors. These monies are not profit made by TCs because back to my first point, TCs are not suppose to be profit making.

Morality has nothing to do with it. They don't have any moral obligations to you. There's only a legal obligation for them to maintain a state of cleanliness in your estate, and to perform the other functions expected (eg building improvements, etc) in return for the money you pay.

You have to understand, a town council is not a bank, the money you give to them is no longer your money, it's their money. unlike a bank deposit that still belongs to you after you give it to the bank. Because you pay them money for rendering a service. So as long as they render their service, they can do whatever they like with whatever leftover money after they pay their contractors.

 

[night86mare]

And depending on the size of the sinking fund, maintenance fees are adjusted accordingly. While these funds are managed by the committee council, the funds really belong to the residents. At AGMs, residents have every right to scrutinise the financial reports and question the committee council over every single cent spent. If a decision needs to be made on a substantial expenditure, a voting by the residents is carried out. The committee council has to observe majority ruling.

are you sure the part in red is true? it was my understanding that maintenance fees (the monthly fee that you pay) are disconnected from the "sinking fund" - the sinking fund has more to do with repairs, upgrades that are "extra" from the usual.

just making some clarification..

 

[Jango]

Yep, personally experienced it. The condo committee felt they have achieved a comfortable level of sinking fund and adjusted the maintenance fee downwards. The monthly maintenance fee is not spent 100%. A percentage of it goes into the sinking fund as reserves. Otherwise where do they get money to fund major refresh/repair expenses? When the condo management asks for more $ from the residents to fund major projects, you know that the sinking fund is insufficient.

are you sure the part in red is true? it was my understanding that maintenance fees (the monthly fee that you pay) are disconnected from the "sinking fund" - the sinking fund has more to do with repairs, upgrades that are "extra" from the usual.

just making some clarification..

 

[velasco]

And I live in Pasir Ris. Will I become poorer?

Will they take away our White Sands or enbloc us all?

 

[waileong]

On the contrary. Town councils employ whoever they like, the people are not public servants or civil servants. Thus the Hougang town council appoints a number of WP members, for instance. I don't think these applied for their jobs through the Civil Service website.

A Town Council and a MCST are very different. You don't get to elect the committee members in a town council. Your MP heads the town council, and he choose whoever he likes for the town council, he doesn't have to get your approval for every major spending decision, although it's true that he could lose his job if he keeps screwing up.

Whether the town council is profit making or not is immaterial. What is important is that the money does not belong to you after you have handed it over to the town council. If you feel that the town council has done a bad job or keeps raising fees unnecessarily, you can vote your MP out. But you cannot go to the town council and ask for your money back. And there's no law that says the town council has to return excess funds back to residents at the end of a fiscal year if it finds itself in surplus.

Town Councils falls under the broad category of Civil Service. Town Councils are not profit oriented organisations. Why are they collecting so much surplus from residents that the reserve is now in the BILLIONS? With such high surpluses why are residents still made to pay for HDB upgrading? Why are some HDB estates in such shieety state?

Those who live in condominiums will know what Sinking Funds are. They are made up of whatever maintenance fund is remaining. And depending on the size of the sinking fund, maintenance fees are adjusted accordingly. While these funds are managed by the committee council, the funds really belong to the residents. At AGMs, residents have every right to scrutinise the financial reports and question the committee council over every single cent spent. If a decision needs to be made on a substantial expenditure, a voting by the residents is carried out. The committee council has to observe majority ruling.

HDB conservancy fees works the same way doesn't it? It is used for the general upkeep of the HBDs and its surroundings. So similarly these reserves held by Town Councils really belongs to the residents, not the chairman or those so call advisors. These monies are not profit made by TCs because back to my first point, TCs are not suppose to be profit making.

 

[night86mare]

Yep, personally experienced it. The condo committee felt they have achieved a comfortable level of sinking fund and adjusted the maintenance fee downwards. The monthly maintenance fee is not spent 100%. A percentage of it goes into the sinking fund as reserves. Otherwise where do they get money to fund major refresh/repair expenses? When the condo management asks for more $ from the residents to fund major projects, you know that the sinking fund is insufficient.

so what happens when the sinking fund runs out

will the condo management up the maintenance fee?

 

[Jango]

So far have not heard of such things. Thats what the condo management is paid to do, manage!

To you question, right at the start the management will set the maintenance fee at a level which they think will provide a sustainable level of sinking fund.

so what happens when the sinking fund runs out

will the condo management up the maintenance fee?

 

[Jango]

Anyone has any photos of the protests at Hong Lim Park? Maybe we could see some faces from TCs if we look close enough. :bsmilie:

 

[mattlock]

On the contrary. Town councils employ whoever they like, the people are not public servants or civil servants. Thus the Hougang town council appoints a number of WP members, for instance. I don't think these applied for their jobs through the Civil Service website.

A Town Council and a MCST are very different. You don't get to elect the committee members in a town council. Your MP heads the town council, and he choose whoever he likes for the town council, he doesn't have to get your approval for every major spending decision, although it's true that he could lose his job if he keeps screwing up.

Whether the town council is profit making or not is immaterial. What is important is that the money does not belong to you after you have handed it over to the town council. If you feel that the town council has done a bad job or keeps raising fees unnecessarily, you can vote your MP out. But you cannot go to the town council and ask for your money back. And there's no law that says the town council has to return excess funds back to residents at the end of a fiscal year if it finds itself in surplus.

Hi Waileong
you are so coldly cynical it's scary...