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Oral reply to PQ on AGO's report on JTC

Oral reply to PQ on AGO's report on JTC

Questions

Mr Chua Kheng Wee Louis: To ask the Minister for Trade and Industry with regard to the Report of the Auditor-General, wherein it stated that test checks found that JTC premises may have been sublet to about 26,000 business entities without JTC's approval (a) whether JTC has completed investigations into all identified business entities and confirmed cases; and (b) what are the penalties imposed on affected tenants, lessees and sub-lessees.

Oral Answer (to be attributed to Minister in the Prime Minister’s Office, and Second Minister for Manpower and Trade & Industry, Dr Tan See Leng)

1. The Auditor-General’s Office (AGO) had, in its 2020 Report, identified 26,000 instances of potential unauthorised subletting because 26,000 business entities had indicated JTC premises as their registered addresses even though they were not JTC’s lessees, tenants or authorised sublessees. 

2. JTC is investigating the entities highlighted by AGO. So far, JTC has found that: 
a. 1,900 are deregistered entities, and 
b. 700 are on divested properties where JTC’s subletting policy does not apply.
c. Another 12,400 are related entities of JTC lessees and tenants. For these cases, even if there was subletting of space, there would not have been any potential loss of revenue as subletting fees would not have applied. 

Together, these 15,000 entities account for around 60% of the entities that AGO has highlighted. 

3. JTC has prioritised investigations for the remaining 40% of the entities — about 11,000 of them.  Based on preliminary investigations, JTC has found that a significant number of them are using JTC premises as their registered address even though they are not physically operating out of the premises. These cases also do not involve any unauthorised subletting of space. 

4. To date, JTC has confirmed around 400 cases of unauthorised subletting. JTC will complete its investigations by the first half of 2021. 

5. JTC is strengthening its processes and inspection regime, and will make use of data analytics to better detect and reduce future incidences of unauthorised subletting. It will take enforcement action against lessees or tenants for confirmed cases of unauthorised subletting. Depending on the severity and circumstances of the breach, enforcement actions range from financial measures to recover the sublet fees owed to JTC, to legal action to repossess the site from recalcitrant occupants. 

 

 
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