>EDB may have to write off $17.3m given to UNSW

>So there it is. Confirmed. The UNSW fiasco is going to cost us $17m.

So much for the highly paid civil servants (and ministers) who bathed in glory when UNSW announced that it would open a full fledged university in Singapore, but remained deafeningly silent, when it announced its pullout.

If the Australians feel that UNSW should be accountable because it tarnished Australia’s image, why are our ministers nonchalantly saying that they are not in the area of business decisions, but are only sponsors? Didn’t the ministers justify the high pay rise with the fact that they are to be treated like CEOs?

Under such circumstances, CEOs would be fired. $17m is a large sum. Why are the top civil servants still keeping their jobs?

http://www.straitstimes.com/Free/Story/STIStory_145246.html

Aug 4, 2007

EDB may have to write off $17.3m given to UNSW

By Jane Ng & Sandra Davie

THE Economic Development Board (EDB) may have to write off the $17.3 million it awarded in grants to the University of New South Wales (UNSW) Asia, as the university may declare itself insolvent.

In a statement yesterday, the parent university in Sydney said UNSW Asia, the company behind the now-defunct Singapore campus, was faced with ‘significant claims’ from creditors.

It said if the claims were upheld, UNSW Asia will not have enough funds to pay up, and may have to consider declaring itself insolvent.

Although it did not name the creditor with the ‘significant claim’, sources close to the university confirmed that it was referring to the EDB, which has asked the university to repay $17.3 million it had given it in grants last year.

The EDB also gave the university another $15 million as part of the building loan for UNSW’s campus in Changi. But that amount is safe as it is backed by a bank guarantee.

Lawyers who specialise in company law told The Straits Times that it was unclear if creditors, including the EDB, could hold the parent university in Sydney liable for the monies owed.

In its statement yesterday, the university also revealed a payment plan for the 47 academic staff affected by the sudden closure of the campus in May.

In the plan, which was also outlined in an e-mail to academic staff, UNSW agreed to honour its initial offer to pay 20 weeks’ salary as compensation. This would be done in two separate payments.

The university will pay staff an initial $7,500. But they will receive the rest of the compensation from UNSW Sydney only after they sign a deed of release. This would mean they could not make any further claims against the university.

The university explained that it had to structure the payment in two parts because Singapore insolvency laws only allow UNSW Asia to pay a maximum of $7,500.

Under the Companies Act, when a company becomes insolvent, it has to pay its staff five months’ salary or $7,500, whichever is lesser.

Academics who received the e-mail as well as the deed of release yesterday afternoon were outraged by the latest announcement.

‘We’re very angry. We were previously told on July 26 that we would not have to sign a discharge form.

‘They’ve created a situation where we will be made to sign away our legal rights under duress,’ said one lecturer.

He also said there was no way he could survive on a $7,500 payout for the rest of the year. This was because he had financial commitments here, but had yet to secure a teaching appointment.

A group of 38 lecturers who have sought legal advice about how to obtain a fair compensation package said they have yet to decide on their next move.

One of them said: ‘The university says there is no legal obligation on its part to make the payment, but there is a moral obligation.’

UNSW announced in May that it would close the Asia campus because of lower-than- expected enrolments and the financial risks involved in continuing the venture.

Of the 143 undergraduate students enrolled at UNSW Asia, 115 of them are now studying at the Sydney campus on scholarships.

The 60 or so non-academic staff members were told that they would be given a month’s salary, plus an additional three months’ ex gratia.
In response to the university’s latest statement, the EDB would only say that ‘discussions are ongoing on the recovery of the loans and grants’.

>Cut the talk, just do the job.

>Looks like the UNSW saga is like a sore on the government’s thumb that simply would not heal. Many questions have been asked, few answered, and when they are answered, more questions arise from the very answers that were given.

Here is an article from http://www.channelnewsasia.com/.

http://www.channelnewsasia.com/stories/singaporelocalnews/view/288515/1/.html

UNSW given S$15m in loans and S$17.3m in grants: EDB
By Pearl Forss, Channel NewsAsia Posted: 16 July 2007 2051 hrs

SINGAPORE: After months of silence, the Economic Development
Board (EDB) revealed on Monday that it has given the University of New South Wales Asia (UNSW Asia) S$15 million in loans and S$17.3 million in grants.

Parliament was told on Monday that the loan was disbursed for the building of the UNSW Changi campus and it could be recovered as it was backed by a bank guarantee.

As for the S$17.3 million in grants, it was given to help UNSW with start-up costs and negotiations were now underway for its return.

However, it was unclear how successful these negotiations would be.

The first signal from a minister that we may have to write the bill off.

Lim Wee Kiak, MP, Sembawang GRC, said: “All business plans must have
contingency. Before the government gave out any funding, were these
contingency plans evaluated and why were they not implemented?”

Lim Hng Kiang, Trade and Industry Minister, said: “Investors know their
business better than the government. In this case, UNSW – as the investor and
the operator – is in the best position to assess the viability of its business
plan. (The) government’s role is to facilitate and support investors in their
decisions, not to second-guess or guide those decisions.”

But, but, but……we were told by the PAP that this is Singapore Inc! PAP, with their high salaries equivalent to CEOs around the world, will have to perform like CEOs!

Why was it when they explained to us peasants that they needed private sector CEO pay, they said that they were running Singapore Inc – but when a boo-boo like The Great UNSW Debacle happens, they are now just a government and let the real CEOs of private companies judge the feasibility of the plan?

Mr Lim said EDB had tried to persuade UNSW Asia to stay and meet a set of interim targets by giving it an additional two years to decide if they want to develop the Changi campus, by offering not to claim back grants and loans that were given out and by offering, through discussions, the possibility of a new support package.

But the UNSW did not take up these offers.

As a peasant, all I remember is that EDB tried to claim that UNSW blamed EDB. UNSW then claimed that it did not blame EDB, which EDB officials then remained silent, giving me, just one of the many simple peasants, the idea that EDB is trying to run away from the issue.

Mr Lim said as UNSW failed to meet pre-agreed milestones, the public funds used would be recovered.

But even if the funds could be recovered, Members of Parliament were still concerned that Singapore’s reputation as a global schoolhouse had been
affected.

Mr Lim assured the House that this was not the case.

He also said Singapore would seriously consider it if another foreign private comprehensive university, like UNSW, were to express their interest in setting up a campus here.

Peasant Solo Bear says, cut the talk, just do the job. We peasants paid you CEO pay, we expect CEO performance. Get those funds back.

>UNSW Debacle – The Blame Game Starts

>Schoolboy A: You bluff me ah! I tell everyone in school you are a liar ah!

Schoolboy B: What? You dare lie I lie ah? Wait I tell everyone you lie that I lie ah!

Schoolboy A: You lie! You lie! You lie!

Schoolboy B: No, you lie! You lie! You lie!

Schoolboy stuff. But it happens in real life. Not between schoolboys, but between matured intellectual parties.

The UNSW pullout has now reached a stage where the concerned parties are trying to find answers (and scapegoats). Granted that it was not sustainable because of low student intake. However, the way the pullout was done leaves much to be desired.

As a Singaporean, I am more concerned about our image as an education hub. I leave the Australians to ponder about their educational institute. What disappointed me was that there was not one official from MOE or EDB present when UNSW announced the pullout. This shows that the government institutions would like to distance itself from the issue.

Contrast the above with the time when it was announced UNSW would set up a full time campus here. Eager beaver officials from EDB and MOE were only too happy to bathe in the limelight. Looks like these officials have abandoned a sinking ship.

Now the blame game starts.

Article 1 below reports that EDB is incensed that UNSW has placed the blame on EDB.

Article 2 below reports that UNSW said it never blamed EDB and is disappointed that EDB released a statement without first consulting UNSW.

Schoolboy A: You did! You did! You did!

Schoolboy B: No I didn’t! I didn’t! I didn’t!

Yucks. I am disappointed that our highly paid civil servants are more keen to run away from blame, than to take responsibility that hundreds of UNSW students have been affected and that Singapore’s image as an educational hub is now tarnished.

Straits Times Article 1 – EDB refutes UNSW’s “claims”

July 6, 2007

ASIA CAMPUS PULLOUT: AUSSIE DON CLAIMS SINGAPORE SCUPPERED SALVAGE PLAN

EDB refutes UNSW chief’s version of story

There was no promise from him on even a smaller campus at Changi despite EDB offer to wait 2 years

By Sandra Davie, Education Correspondent

THE Economic Development Board (EDB) has refuted a claim by the chief of an Australian university that its Asian branch campus here failed because the board scuppered his proposed deal to save it.

The EDB wrote to Professor Fred Hilmer of the Sydney-based University of New South Wales (UNSW) to take issue with comments he made in The Australian newspaper published on Wednesday.

He told the paper he had proposed a salvage plan for UNSW Asia, which the EDB rejected at the 11th hour.

He was also quoted as having said: ‘It was for a smaller, slower start-up with less research, certainly in the early years.’

UNSW announced the closure of UNSW Asia on May 23, claiming that its student intake had fallen far too short of its target.

Prof Hilmer had flown to Singapore to announce the closure at a press conference, during which he said he was not prepared to pour millions of dollars into the campus while waiting for it to take off.

But in his latest comments in the Australian media, he ‘sought to lay the blame for the closure’ on the EDB, said the board in its letter, which was released to the Singapore media.

Giving its side of the story, the EDB revealed that Prof Hilmer had wanted to renegotiate the support package as soon as he took over as vice-chancellor in the middle of last year.

The board agreed by ‘significantly’ increasing its support package, although enrolment targets remained about the same – which was for the university to have 10,000 students in 2015 and 15,000 a few years later.

The EDB said that when Prof Hilmer signed the new agreement in December last year, he agreed to speed up the development of UNSW Asia’s campus in Changi and add more research and development activities.

But he was back at the bargaining table just three months later, after the intake met only half the target enrolment of 300.

This time around, he proposed scaling enrolment down to 2,000 students by 2016 – 8,000 fewer than the original target.

The EDB said he also offered no assurance that the Changi campus would be built, or even that it would be built on a smaller scale.

This was despite the board’s agreeing to wait another two years for UNSW to decide on the fate of its Changi campus, which was to have replaced its temporary Kay Siang Road one.

The board had also meanwhile agreed to continue with the same grants and loan package, with no further increases.

The EDB said that contrary to the impression that Prof Hilmer had given – that all that was involved was a slower rate of increase in enrolment – he was actually proposing a much smaller enrolment, even for the longer term.

The board told him that, because this was a matter of interest to the Singapore public, it would send a copy of its letter to the Singapore media.

Dr Lily Neo, who heads the Government Parliamentary Committee for Education, noted that Prof Hilmer’s revised enrolment figure showed a lack of commitment from UNSW.

To date, the EDB has declined to reveal how much it has given UNSW in grants and loans. But it has been reported that it gave UNSW some $17.3 million last year.

The university was also given a loan facility of $156.8 million to develop its Changi campus by the EDB and the Australia and New Zealand Bank. So far, $21 million had been drawn down.

Straits Times Article 2 – UNSW to EDB – What “claims” talking you?

July 7, 2007

ASIA CAMPUS PULLOUT
UNSW chief: We never blamed EDB

By Sandra Davie, Education Correspondent

UNIVERSITY of New South Wales (UNSW) chief Fred Hilmer has responded to the Economic Development Board’s (EDB) letter by saying that the university at no stage attempted to lay the blame for the closure of its Singapore campus on the board.

He said in his press statement yesterday: ‘We have from the outset stated that the university put forward a proposal for a revised plan for UNSW Asia which in the end was not acceptable to the EDB. This is an entirely accurate account of events.’

He also said that it was ‘regrettable’ that the EDB did not contact him personally before releasing the letter to the Singapore media.

The letter he was referring to was released to the media on Thursday.

In it, the EDB took issue with comments Professor Hilmer made in The Australian newspaper published on Wednesday.

In its letter, the EDB said that in the middle of last year, Prof Hilmer wanted to re-negotiate the level of support the EDB was willing to provide.

The board agreed by ‘significantly’ increasing its support package. But the enrolment targets – 10,000 students in 2015 and 15,000 a few years later – remained about the same. Three months later, after the university’s intake met only half the targeted enrolment of 300 for the semester, said the letter, Prof Hilmer contacted the EDB again.

This time around, Prof Hilmer proposed scaling enrolment down to 2,000 students. He also offered no assurance that the Changi campus would be built eventually.

Meanwhile, the EDB agreed to continue with the same grants and loan package, with no further increases.

It is this point in the EDB letter that needs to be put ‘into context’, said Professor Hilmer in his statement yesterday.

‘The proposal, put to us on the Saturday before the closure announcement, was at a level of support significantly below that agreed upon by a joint working party earlier that week,’ claimed Professor Hilmer.

He said this was recognised by EDB officials, which affirmed their understanding that, in the light of this revised offer, the EDB would fully understand if UNSW found it not possible to continue with the campus in Singapore.

When contacted yesterday, the EDB said it did not want to comment further on the matter.

>UNSW Test Case – Can Foreigners who claim Singapore is the “Perfect Workplace” live up to it?

>Refer to Straits Times article dated 8 Jun 2007 on page 4 (Home), “UNSW Asia lecturers still unhappy after meeting”.

I have met many people (foreigners included) who tell me that Singapore is a haven. Low income tax, good infrastructure, first class living etc. To me, that’s all talk. Especially if it is from foreigners who always have the option to return to their homeland and retire rich.

However, the recent University of New South Wales debacle can be used as a test case to see if foreigners can really live up to it – ie imake Singapore their long term workplace and home.

We now have about 40 foreign lecturers who are out of jobs, no thanks to UNSW’s sudden pullout. Some of these lecturers have sold their homes in Australia, with the intention to settle their families here. The situation today is that since UNSW has pulled out, they are effectively out of jobs.

The test is – if Singapore is truly the haven as many foreigners have always claimed, then these out of job lecturers, who have their families here in Singapore now, should have no problems making Singapore their “second home” – with or without being employed by UNSW. Yet, some of them are “devastated” because they have sold their homes in Australia, which means that it is now not too easy for them to “return home” – temporarily at least.

So can they pass the acid test? Here are pros these lecturers have (or so called “pros” if you believe that Singapore truly is a haven for those who seek work)

1. These lecturers are highly qualified – you need at least a PhD to be a lecturer.

2. They have the experience in a field where the Singapore government is keen on – education.

3. They have been briefed by UNSW on how to adapt to Singapore’s culture and hence are already mentally and emotionally prepared to blend into our local atmosphere.

4. Australia’s legal system and infrastructure are not too different from Singapore’s due to our historical ties with Britain.

So can these lecturers and their families adapt? Here are the real hard facts they are going to face if they make Singapore their home.

Residence – since they are not PRs (yet), they are not allowed to purchase HDB flats. That means they have to either buy a private property or rent out a place. With the rising costs of private properties, that could be a few thousands a month for a family of four or five.

The only way they could purchase an HDB flat is to be a PR, which should not be a problem since Singapore is looking for “talent” like them. However, since they would only have started to work as a PR recently, the amount in their CPF would still not be enough to purchase an HDB flat. That means they have to wait at least for a few years before they can even make the first down payment. In the meantime, they have to stick to purchasing a private property or rent a property.

Children’s Education – Of course if they can afford sending them to private schools would be ideal. But it must be remembered that if they work in Singapore, they would be offered Singapore employee’s benefits. So in all probability, they have to school their children in public schools due to lack of affordability.

The above itself has its own challenges. The biggest impact is the mandatory Mother Tongue. Being Australians, in all probability, their children are fluent in only one language – English. Unlike Indian and Chinese nationals where Mandarin, Tamil, Urdu, Hindi etc are natural choices, the Australian children will have some problems choosing their Mother Tongue.

Other challenges would of course be the “pressure cooker” school system which requires you to be efficient in CCA, sports and academic studies all in one go.

Most foreigners that I have come across who say that Singapore is a good place to work in have already secured their jobs with favourable terms. The real test case is when that foreigner makes a fresh application in the job market and compete with other Singapore residents.

Foreigners can always pack and leave if the heat gets too intense. Rising property costs and rent are now eating into their salaries. It has been reported in the Straits Times a few weeks back that some expatriates are considering leaving Singapore. Or at least, they are considering sending their families back home. That is an indication that Singapore is not the haven it is supposed to be as claimed.

The crux of the matter is not whether Singapore is a workplace haven. The crux of the matter is are you able to make a decent living in Singapore. If your salary is good, but your costs (especially living expenses like housing and rent) eats into that salary, that so called haven does not look so heavenly after all.

The UNSW debacle should be a good test case. Let’s see how many of these displaced lecturers will make Singapore their home. Let’s see if these foreigners came to Singapore because the working and living conditions in Singapore are good, or because they had a silver platter handed to them, in the form of attractive employment terms, in this case, courtesy of UNSW.

Now that the silver platter has been taken away, let’s see if they can adapt to the Singapore way of living, living the way Singaporeans live.

My contention is that for so long as you (not your family) come here to work, you will enjoy the benefits. The burden piles the moment you have a family here. That’s because you need to house them, feed them and school them. That’s what is killing most Singaporeans – not the conducive work environment, which gives many foreigners the fallacious idea that Singapore is the “perfect haven” for you to make your home.

Basically, if you work here, but your family is elsewhere, what “home” do you call that?

Much as we all sympathize these lecturers who have sold their homes and now lost their jobs, this debacle serves as a test case to see if the yet to be proven idea if Singapore is a haven is true or not. Can they and their families adapt to the “real life” in Singapore – ie living in Singapore, minus the silver platter from their employers?

Or will we see them make every effort to return to Australia with their families, in spite they have no homes there now, hence debunking the notion that Singapore is the perfect place to work and live in.