Written by Ng E-Jay
19 Aug 2009
Finance Minister Tharman Shanmugaratnam was so evasive about questions posed in Parliament in Tuesday concerning Temasek’s short-lived CEO Charles “Chip” Goodyear that one cannot be blamed for thinking he could have been hiding some private secret that he does not want dragged into the light of day.
According to a Channel News Asia report, Mr Tharman was grilled for nearly 20 minutes by MPs who raised various questions pertaining to Temasek Holdings, including whether it should be headed by a foreigner, as well as the reasons for the sudden departure of Mr Goodyear after he had obtained the ringing endorsement of the Government only months ago.
Mr Tharman told Parliament that the Government will leave the decision to Temasek on when to appoint a new successor, but he added the next CEO should ideally be a Singaporean.
However, when he was asked for more details on why Mr Charles Goodyear left Temasek Holdings recently after having held the job for only 5 months, Mr Tharman flatly refused to divulge anything, saying it “serves no strategic purpose” for the public to know.
These were also his exact words: “People do want to know. There’s curiosity. It is a matter of public interest. But that is not sufficient reason to disclose information.”
You can’t get more evasive and squirmish than that.
Up till now, the Government will only say that Mr Goodyear left for “strategic reasons”, but will not elaborate on what they are.
The lack of transparency by the Government on this issue, and in particular by the Finance Minister, is startling.
Temasek Holdings is an entity vested with the responsibility of investing our nation’s surplus savings, along with GIC which has the similar responsibility of managing our country’s foreign reserves. These assets represent taxes paid by Singaporeans and public sector surpluses that have been accumulated over many years. They represent the blood, sweat, toil and tears of ordinary Singaporeans. We have a right to know how these reserves are managed and how exactly Temasek and GIC are run. We have a right to know why Temasek’s top management has gone through such unusual upheavals.
Is the Finance Minister trying to imply that revealing any more information about Goodyear’s abrupt departure will jeopardize sensitive information about Temasek?
If so, I am completely unconvinced. Goodyear’s appointment and subsequent departure is a human resource issue. How does it have anything to do with state secrets or privileged information possessed by Temasek Holdings?
Or perhaps the Finance Minister is unable to reveal more information about Mr Goodyear because the former CEO had attempted to set the house in order, and he had tried to do so in a way that the Government did not approve of.
Is this a personality issue and a turf-fight within Temasek? One may never know.
I also do not buy the oft-repeated argument that Temasek’s and GIC’s books cannot be fully open for inspection as it will comprise their investments if the public came to know all the details.
Temasek and GIC are not supposed to be hedge funds that engage in high risk, high frequency trading, if indeed what we are led to believe about them is true.
Temasek in particular often claims that its investments are for the very long term, and that they are prepared to ride the ups and downs of the market over multiple economic cycles. If so, shouldn’t they be immune to front-running by other fund managers and other aggressive trading strategies employed by riskier investment firms?
In replying to Mr Low Thia Khiang (MP for Hougang) who asked how will the government ensure that Mr Goodyear does not divulge any sensitive information about Temasek that he may have obtained during his short tenure as CEO, Mr Tharman replied: “The main thing that we’re very guarded about is the size of our reserves, not Temasek’s assets because that’s fully published. But the size of our GIC (Government of Singapore Investment Corporation) assets is not published. And that would not have been accessible to Mr Goodyear or to other senior management in Temasek.”
Which brings us to the next question: Why the great secrecy over the size of our reserves?
Assuming the current Government will likely continue to remain in power for quite some time, it is an extremely risky proposition for Singaporeans to be denied basic facts about our reserves and the way they are managed. No one might know if something has gone terribly wrong for a long time if the Government refuses to be transparent about it.
The lack of accountability has also reared its ugly head in recent months when it came to light that Temasek Holdings suffered a huge loss in its investments due to the bear market.
Had those investment losses been used for the public good, they could have provided transport subsidies for the poor and disabled, welfare services for the homeless, and allowed all Singaporeans to enjoy unemployment insurance for years.
Why are we allowing our national savings to be put to such risk? With all of our national institutions under the purview of the Executive, which has complete control over Parliament as well, there is no one to hold Temasek and GIC accountable for their actions.
In Parliament, Mr Tharman also added that there is no push factor for current CEO Ms Ho Ching to step down.
So I guess the lady CEO who presided over the staggering investment losses by Temasek over the past year will still be in the hot seat for some time to come.
That truly is cold comfort.