In a Facebook post, Law and Home Affairs Minister K Shanmugam said he noted from the wider discussions on the Income-Allianz deal that there are several different misperceptions on this matter.
He mentioned two of them in his post. These are:
(1) That the Government was intent on proceeding with the deal, until there was public feedback – and then changed its views.
(2) That the Government is not coordinated, because MCCY did not know what MAS knew, about the details of the deal.
Mr Shanmugam said that Parliamentary Statements actually set out the facts, and going through them would clear the misconceptions.
Misconception that the Government was intent on proceeding with the deal until there was public feedback
Mr Shanmugam explains that those who have expressed this view assumed that MCCY knew about the deal, from the beginning – and had in some way blessed it, only to reverse its decision later.
The reality is that MCCY and most of the Government did not know about the deal, until it was publicly announced, in mid-July.
Another basic fact to note, Mr Shanmugam said, is that Parliament first discussed this matter in August.
At the time, it was made clear, that the deal was still under consideration and subject to regulatory approval. That was repeated at the subsequent October sitting – that the deal has not been approved.
Agencies took a positive view initially, before the full facts were known to all the relevant agencies.
When the facts were clear and had been shared, as part of the decision-making process, the decision was that the deal cannot go through, Mr Shanmugam said.
The assumption and comments that the Government as a whole must have known and blessed the deal, before reversing its decision are all conjectures, based on a misunderstanding of what the law is and how a proper system functions, with confidentiality. They also ignore the facts that have been set out in Parliament.
The Government is not coordinated, because MCCY did not know what MAS knew, about the details of the deal?
On this second point, about coordination, Mr Shanmugam explained that the terms of the deal were disclosed to MAS – because MAS is the regulatory authority, and the deal was subject to MAS approval.
But MAS cannot go around disclosing the terms willy nilly to other parts of the Government because the terms are confidential and market sensitive, he said.
The regulatory bodies (like MAS) which receive information of such deals are required to maintain the strictest confidentiality.
Most of the time, the information is dealt with at the operational level. But there can be situations (not the norm) where, based on a technical assessment, the information needs to be (and is) surfaced to a higher level, or disclosed to other agencies.
And that is what happened in this case, Mr Shanmugam said.
Up to the August Parliament sitting, the MAS team reviewing the deal was not aware of MCCY’s considerations in giving Income the exemption under section 88 of the Co-operative Societies Act. The details of the exemption were not made public.
In the course of assessing the deal, the MAS team realised that the capital reduction plan might be relevant to MCCY – and they informed the MAS Board, and also shared the details with MCCY.
Once MCCY came to know about the details of the deal, (this was after the August Parliamentary sitting), it conveyed its views, Mr Shanmugam said.
Essentially, the point made by those who say that the Government was not coordinated is: why didn’t the Government, as a whole, know everything about the deal, when the deal was announced in July?
Is that practical? What is MAS expected to do, Mr Shanmugam asked? Is the MAS to broadcast to all Government agencies every deal, and only approve when all of them have given their agreement?
That is an extreme and untenable position, he said.
It would result in breaches of MAS’s duty of confidentiality, undermine trust in Government, and damage Singapore’s reputation, as an international commercial hub – a point which some MPs raised, in Parliament, he added.
In this case, the deal has been stopped, with full regard for the law and due process, Mr Shanmugam emphasized.
In August, the Government gave its interim views in Parliament – and continued to study the matter thereafter.
MAS and MCCY worked together closely. With the full facts, the Government moved decisively to amend the Insurance Act, on an urgent basis, to stop the deal.
That is how this Government functions: Working within a framework of laws. Co-ordinating closely across agencies. Making decisions based on the full facts. And when Singapore and Singaporeans’ interests are at stake, we take a clear position, even if hard decisions have to be made. We do not flinch. We do not abstain. We act in the interest of, and are fully accountable to, Singaporeans. This shows a System in good working order, said Mr Shanmugam.
