PUB acknowledges the lapses observed in the Auditor-General’s Office (AGO) report for FY2024/25. PUB takes AGO’s findings very seriously and has taken immediate steps to rectify the lapses and improve our processes. We will continue to review and strengthen our system of managing procurement and operations.
Possible irregularities in quotations for star rate items
2 Under a construction contract, AGO found possible irregularities in quotations obtained. These were for additional works due to changes in design or scope, also known as star rate items. Of the 25 star rate items checked, AGO raised concerns over the authenticity of quotations provided for 23 items, which amounted to a total value of $148,900.
3 PUB has reported the matter to the police to investigate if there were any fraudulent practices in the quotations provided to PUB. The police investigation is ongoing. Following this incident, we have completed a thorough review of similar contracts and found no similar irregularities. PUB has measures in place to manage star rate items, including procedures on how star rates should be evaluated and supervisory checks to approve the rates. However, we recognise that it may not be straightforward to identify irregularities immediately, especially for more complex cases or instances where signs are not obvious. Moving forward, we will enhance the training of our officers to ensure that they are familiar with and adhere to the proper procurement processes, and to raise their awareness in identifying possible irregularities in quotations for star rate items.
Oversight of maintenance contracts for water quality analysers
4 AGO’s audit also uncovered issues regarding maintenance services contracts covering PUB’s water quality analysers at three private sector operated desalination plants. At two of these plants, PUB’s analysers experienced technical issues that resulted in malfunctioning of SMS alert systems, as well as gaps in data transfer from the analysers over a 12-month period. However, PUB’s maintenance contracts did not cover maintenance of the alert systems and data transfer to PUB, and we acknowledge that the scope of the contracts should have been more comprehensive. PUB became aware of the issues in mid-2023 and took action, such as engaging the original equipment manufacturer’s authorised agent, to resolve these issues and to develop longer term solutions. The PUB analysers at the two plants were eventually restored in late 2024. Since January 2025, PUB has linked all the analysers to our internal system directly, enabling the automation of alerts and data transfer.
5 We would like to assure the public that the water quality at the desalination plants was not compromised at any point in time. PUB maintains a comprehensive and robust water quality monitoring system at all our plants and across our water distribution network. The private sector operators are required to install water quality analysers for round-the-clock monitoring. Data from their water quality analysers is transferred directly to PUB, which would be cross-checked with results from PUB’s daily water sampling tests. Over and above these measures, PUB’s water quality analysers were installed as additional precautionary checks to provide further safeguards on water quality.
Lapses in management of biocide and chemical supply contracts
6 AGO also observed lapses in our contract management for the supply of biocide, which is primarily used to control the midge population in our reservoirs and waterways. Our standard operating procedure (SOP) requires purchase orders to be raised when biocide stock reaches a specific trigger level. PUB has an inventory system to manage all our stocks. However, there were lapses during the process of monitoring and verifying the stock levels of biocide which resulted in delayed purchase orders and PUB incurring an additional cost of approximately $300,000 to expedite the replenishment of stocks. To prevent recurrence, we have automated the monitoring of biocide stocks which sends out alerts when stocks fall below the trigger level.
7 For the same biocide contract and another two contracts for the supply of chemicals for water disinfection, payments were disbursed to the contractors without verifying that Certificates of Analysis (COAs) provided comply with PUB’s specified requirements. PUB has conducted thorough checks on the biocide and chemical contracts and confirmed that the quality of the stocks that we had received earlier met PUB’s requirements. PUB has processes to ensure the quality of the biocide and chemicals used in our operations, which include testing by accredited laboratories. We have since tightened our SOPs on conducting checks on COAs. We will also explore digitalising the checks on COAs going forward. Disciplinary actions have been taken against PUB officers accountable for these lapses.
Possible irregularities in records furnished for audit
8 AGO’s audit also found possible irregularities between the softcopy and hardcopy COAs of the biocide stocks that were submitted to PUB by the contractor. The officer had asked the contractor to update the previously sent COAs, to give the false impression that the full information had been provided on the active ingredient level in the biocide, and that the contractual requirements had been met. PUB does not condone the alteration of documents furnished for audit and expects our officers to conduct themselves with integrity and professionalism. We have carried out and completed our internal investigation and taken disciplinary action against the officer involved. PUB will use this incident to remind officers and highlight our stance against any alteration of documents.
Continuing efforts to improve processes and procedures
9 PUB maintains high standards in our operations, supported by a robust system of checks at every critical juncture. Our procurement system is in line with Government procurement procedures, with proper segregation of duties and checks built into the entire procurement process. We will continue to review and strengthen our management of processes and procedures, and exercise greater oversight over our consultants and contractors. Comprehensive training sessions and workshops are conducted to communicate established SOPs to our officers, ensuring that they are competent in fulfilling procurement requirements to prevent recurrence of the lapses highlighted.
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Afternote: Minister for Sustainability and the Environment Grace Fu delivered an oral reply in Parliament on 22 September 2025, in response to questions regarding the Auditor-General's Office (AGO) audit findings on PUB. To view the reply, click here.
