We thank him for allowing us to republish this on our blog. We applaud Bernard's stance as a proactive, concerned undergrad, in voicing out on such an issue.
However, it was with deepest regrets that instead of standing united with Bernard, some NUS undergrads chose to question his purpose and motive of campaigning for such an issue, and linking it to his political inclination. We feel that that is indeed an under the belt blow. What goes below is the note written by Bernard.
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I posted this note on the afternoon of 31 January 2011 on the Facebook Page of NUSSU and when I checked it again at 1918hrs, it has been taken down/ deleted by NUSSU.
I understand that NUSSU and the 14 constituent clubs are currently in talks with the NUS administration to allow the administration to use monies accumulated in the reserves of each constituent clubs for purposes of investment in existing investment plan(s) that NUS currently holds. Which particular investment plan, NUSSU has no idea. The negotiations has been ongoing for at least 6 months now. The monies in the reserves are built up over the years from the annual subscription fees that students pay to NUSSU for "Student Activity and Services". Each student has to pay $24 every academic year. According to the NUS State of the University Report in 2010, there are currently 25,168 undergraduates enrolled in NUS. This means that every year, NUSSU collects $604,032 from its students. Each constituent club would then be allocated a sum of money for its activities and services throughout the academic year. Any funds that are left over would be channeled to the reserves for use under "exceptional circumstances" such as the purchase of fixed assets or any shortfall in funds in the planning for student activities. Till date, I understand this reserves amounted to a figure worth hundreds of thousands of dollars.
It is clear to me that NUSSU and the 14 constituent clubs are guardians of the monies on behalf of the students. The monies in the reserves have been painstakingly built up over the years by different batches that have studied in NUS. With this in mind, these monies do not belong to NUSSU per se and thus NUSSU has to be accountable and transparent to the student population in instances where these monies from the reserves is being utilised. Sadly, this is not the case. The question is why?
I have a couple of questions that I would like to ask NUSSU
1) Why is NUSSU so secretive in its communication with the student population and
2) What's the point of quietly going about this negotiation with the NUS administration without mentioning a word to the student population?
3) Are NUS undergraduates not qualified to know what exactly is happening? Are we not stakeholders of these monies?
4) How can the students trust NUSSU to carry on with the negotiations when it has been unaccountable and nontransparent in its conduct as seen in the recent issue over the tuition fee hike?
5) How much monies are there in the reserves?
6) How is these monies going to be invested and what are the returns like?
7) How would the students benefit from the investment?
8) In the event of a failed investment, are there any safeguards that NUS can promise to the student population?
9) Has the negotiation been conducted on a equal basis? Has the administration been exceedingly forcefully in trying to obtain an agreement from NUSSU and the 14 constituent clubs?
10) Can undergraduates in NUS trust NUSSU?
I would like NUSSU to stop the negotiation with immediate effect and commence with the consultation process with the student population in each faculty, with the objectives of (1) explaining to them what this entire project is all about; (2) seeking the acquiescence of the students to represent them in any future negotiations with the administration. In the event that no consensus/ decision can be obtained, this issue should be put forth in a form of a student referendum to chart the way forward (i.e. to accept OR reject the use of the monies for investment)
Such behaviour of the union is deeply deeply regrettable. In the first place, no undergraduate has agreed to allow the use of the reserves for purposes of investment. NUSSU was created to serve the students, its biggest stakeholder and not to impose its collective will upon them.
Where's the accountability, transparency and representation?
and exactly, where!!
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Such a note did jolt NUSSU out of their seats. a few days later, came their reply:
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Dear Students,
NUSSU is glad to have received feedback and opinions from students regarding how the Union handles issues like subscription fees, investment of reserves, etc.
The Union receives a subscription fee of $24 from each NUS undergraduate on an annual basis, and this fee is divided equally into 3 portions, These fees collected are used to cover the clubs’ respective operations and initiatives. The breakdown can be found in our latest *Annual General Meeting Report 2010.
The Office of Financial Services (OFS) approached NUSSU about 6 months ago with a proposal to move NUSSU’s reserves from a current fixed deposit scheme to the University’s investment portfolio. From our understanding, the University’s investment portfolio consists of both short term and long term portfolios and these investments would be handled by the NUS Investment Office (IVO). The relevant information on this investment proposal can be found in an excerpt from the *Terms and Conditions .
Currently, NUSSU is still engaged in talks with IVO and OFS and we have currently an understanding that between all parties that the investment will not proceed NUSSU agrees to the proposed scheme, after ascertaining that the students’ interests will not be compromised. NUSSU fully intends to continue engaging IVO and OFS in further discussions and negotiations before making any commitment of our reserves. NUSSU Exco and Constituent Clubs will also, with consultation and information in mind, announce their intentions with regard to the proposed investment plan prior to making any decision. NUSSU has yet to promise anything as of now with regard to this investment of reserves.
NUSSU invites all interested students to a forum on the 16th February 2011, 7pm, at the Yusof Ishak House (YIH) Students’ Lounge. The NUSSU Forum will be announced to all students along with the agenda via the NUSmail.
*The Annual General Meeting Report and the Investment Terms and Conditions can be found at the NUSSU Website via the following link:
http://community.nus.edu.sg/nussu/
Thank you.
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In short, we understand that the NUSSU is quite rich in reserves ($600,000 collected every year) . And the Office of Financial Services (OFA) is eyeballing the reserves and approached NUSSU in transferring NUSSU reserves to the OFA instead.
Of course, when we say, 'approach' there are various ways of approaching, consider such examples:
"Hey sexy, Could i buy a drink for you? what would it be, a long island ice tea?"
OR
"This is a hold up. Give me all your money, OR ELSE."
Whether NUSSU were fully agreeing to the notion, to transfer their reserves to OFA, or they were they being probed and pushed to do so, we do not know. Neither did NUSSU explain.
So the issue lies in, currently NUSSU reserves are placed in current fixed deposits schemes which are low risk, safe and guaranteed by MAS. Which suits NUSSU investment horizon. NUSSU is a Student Union, where union fees collected are mainly for the operation expenses for student activities. Where by excess would be better kept for rainy days. Cash has to be liquid (can be withdrawn anytime) and the principal amount MUST not be undercut by volatility in the investments.
(Let me explain, for non finance-savvy students. lets consider an example of an small minimart. A minimart needs cash for buying stocks (like milk, cup noodles etc) Of course when the owner has some earnings from the day, he deposits the money into savings/fixed deposits in banks, so when money is needed he can use it as and when he wants. Of course, asking the owner to invest the excess cash into riskier stocks and options may not be good, because the risks and volatility of such investments may cause him to lose part or whole of the money.)
However if such reserves were transfered to NUS investment porfolio, would such an investment portfolio suit the needs of NUSSU? The university investment's portfolio would diversify their investments into stocks, bonds, money markets, etc. But on NUSSU's side, do they need to see their reserves being invested into such risker investment sources? What about the market risk of such investments? Will NUSSU bare the loss of their reserves if NUS investment portfolio fails? Does NUSSU even need to assume such a risk for their reserves?
What do you think? let us know through a comment below!
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