Parliamentary Replies

Date: 4 February 2009

Question No. 921 (by Dr Loo Choon Yong, Nominated MP):

To ask the Minister for Finance (a) whether he is kept informed of the real or potential contingent liabilities of all Government agencies, Government-linked companies and investment entities; and (b) whether his Ministry keeps a register of all such contingent liabilities.

Reply by Finance Minister Tharman Shanmugaratnam:

The Ministry of Finance (MOF) monitors the financial position, including any contingent liabilities, of all Ministries and Organs of State, Statutory Boards, as well as holding companies which are owned directly by the Government.

MOF compiles annual returns from all Ministries and Organs of State on any guarantees they have provided, promissory notes issued, outstanding contributions to international organisations, as well as statutory obligations under the Acts. Any guarantees provided by the Government must be approved by the President.

MOF also requires all Statutory Boards to submit their annual audited financial statements.

Any contingent liabilities of the Statutory Boards would either be provided for in these financial statements or disclosed within the notes to the financial statements. These financial statements are presented to Parliament.

As for the holding companies which are owned directly by the Government, they are managed independently by their respective boards. As with the private sector, these companies submit to its shareholder, MOF, regular reports on its financial position and performance, including contingent liabilities, if any. MOF does not micro-manage the liabilities or contingent liabilities of the companies.