Actions to Correct Lapses in Administration of Enterprise Development Grant
Ministry of Trade and IndustrySpeakers
Summary
This question concerns the administration of the Enterprise Development Grant (EDG) and measures taken to ensure compliance with the 30% local shareholding criterion. Mr Pritam Singh inquired about the total number of grant recipients and whether Enterprise Singapore (ESG) claws back funds when shareholding requirements are breached. Minister of State Low Yen Ling stated that ESG has supported nearly 5,000 projects and will withhold or recover grants if recipients violate their shareholding conditions. She explained that ESG has added a second round of eligibility checks before disbursement and is exploring data analytics to improve the robustness of governance processes. Finally, the Minister of State confirmed that no funds were disbursed in the case highlighted by the Auditor-General's Report, and the involved company now faces stricter scrutiny.
Transcript
23 Mr Pritam Singh asked the Minister for Trade and Industry in view of the Auditor-General's Report for FY 2019/2020 (a) how many companies have received the Enterprise Development Grant (EDG) so far; (b) what action will Enterprise Singapore (ESG) undertake to ensure strict compliance to the minimum 30% local shareholding criterion for all future cases; and (c) whether ESG claws back grant monies from recipient companies as a matter of practice when there a substantial change in local shareholding before an EDG-funded project is completed.
The Minister of State for Trade and Industry (Ms Low Yen Ling) (for the Minister for Trade and Industry): Mr Speaker, Sir, the Enterprise Development Grant (EDG) is part of Enterprise Singapore’s (ESG) toolkit to help businesses grow their core capabilities, innovate and internationalise. As of September 2020, ESG has supported almost 5,000 EDG projects. In administering the grants, ESG strives to strike a balance between ensuring the robustness of the governance process and the ease with which local enterprises can apply for support.
Checks are performed during the grant approval process to ensure the EDG applicants meet the minimum 30% local shareholding criterion. Thereafter, the grant conditions require all EDG recipients to inform ESG of any changes in the application information during the course of the project. If recipients are found to be in breach of the grant conditions, including the 30% local shareholding criterion, ESG will withhold or, if disbursement had been made, ESG will claw back the grant. ESG will also subject these companies to enhanced scrutiny for future applications.
For the case raised in the AGO Report, no disbursement had been made to the company. The company has also been placed on ESG’s watchlist for stricter scrutiny for future grant applications.
ESG agrees with AGO’s recommendation and has commenced a second round of checks on shareholding eligibility before grant disbursement. ESG is also studying the feasibility of improving such checks using tools, such as data analytics.