LCQ1 : PPP approach in the reprovisioning and operation of STWTW
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	Following is a question by Dr the Hon Ho Chung-tai and an oral reply by the Secretary for the Environment, Transport and Works, Dr Sarah Liao, in the Legislative Council meeting today (October 13) :-


Question :

	It is learnt that the Government has planned to adopt the Public Private Partnership approach in the in-situ reprovisioning and operation of the Sha Tin Water Treatment Works, and that a relevant staff union has requested to meet the Bureau Secretary concerned to discuss the issue when petitioning against the plan in April this year.  However, so far the Bureau Secretary has not yet received the staff union.  In this connection, will the Government inform this Council :

(a) of the reasons why the Bureau Secretary has not yet received the staff union;

(b) as the consultancy study on the feasibility of the plan was already completed in May this year, when the authorities expect to decide whether or not to implement the plan; and

(c) whether it will set a timetable for the work of the plan such as public consultation, advance works, preparation of contract documents and award of contracts, etc; if it will, of the details?


Reply :

Madam President,

	Before responding to the question raised by Dr Ho, I would like to briefly introduce the background and progress of considerations given by the Government on in-situ reprovisioning and operation of the Sha Tin Water Treatment Works (STWTW) using the Public Private Partnership (PPP) approach.

	The Government is committed to enhancing productivity in the public sector and has been looking for partnership models to synergize resources and expertise of the public and private sectors in delivering large scale public works projects while upholding the principle of "fairness, justice and openness".  Through refuse transfer stations and landfill projects, we have already gained some successful experience on this subject.  The Chief Executive has pledged in his 2004 Policy Agenda to the wider use of PPP, and the Financial Secretary has mentioned in his Budget Speech in March this year that the Government has further expanded the scope of PPP pilot projects to include in-situ reprovisioning of STWTW.

	To evaluate prudently the practical feasibility of this proposal, we commissioned in late 2003 a consultancy study on options for in-situ reprovisioning and operation of STWTW using PPP.  During the course of this study, we have expanded its scope to cover facilities and services directly linked with STWTW in light of market response.  The findings of this study are positive.

	We take a serious view on the feedback from Honourable Members and have presented the consultancy study reports at a special meeting of the Panel on Planning, Lands and Works of the previous Legislative Council held on May 18, 2004.  We have also published the study reports and uploaded all relevant documents onto the webpage of the Environment, Transport and Works Bureau to collect feedback from staff and the general public.

	The Bureau is fully aware of the requests and anxiety expressed by staff after the Director of Water Supplies announced at an extended meeting of the Staff Consultative Committee held in August 2003 that the Government would consider in-situ reprovisioning and operation of STWTW using PPP.  Since then,  the departmental management has maintained close communication with staff and a bureau representative has met twice with union representatives in late April and early May to explain in detail the objectives and progress of the feasibility study.

	Meanwhile, the Director of Water Supplies has set up a Special Consultative Committee in May which has held three formal meetings thus far.  This committee comprises over 20 representatives from seven staff unions as well as the Alliance of Staff Unions of the Water Supplies Department.  The Deputy Secretary of the Bureau also attended its last meeting to have in-depth discussion and exchange with staff on matters of concern.  Moreover, the Director has paid nine visits to various headquarters and regional offices within two weeks in June to have direct dialogue with staff of different grades and ranks.

	My responses to the three queries raised by Dr Ho are as follows :

(i) Staff unions of the Water Supplies Department have conveyed to me in various ways their requests for a meeting.  But I would like to stress that there are established procedures in the civil service so we must allow for discussion on substance and details at this stage.  I respect these procedures and understand that the departmental management and the bureau are actively and effectively performing their tasks.  For example, the departmental management convened a special meeting last Thursday to discuss different PPP options with union representatives, while the Deputy Director of Water Supplies and staff representatives will visit water supply facilities operated by private proprietors in Macau and Zhongshan today for experience sharing.  At the same time, some staff and general public have conveyed their views to me through different channels.  It is incumbent upon me to take into account the long-term interest of Hong Kong and to balance reasonable staff expectations in analysing and examining this very importance issue.  I will certainly be prepared to meet with staff at an appropriate juncture.

(ii)&(iii) While the feasibility study reports on in-situ reprovisioning and operation of STWTW using PPP have been completed and the findings and recommendations uploaded onto the Internet for public comments, we are actively exploring a feasible way forward in consultation with staff and will consult this Council before making a decision.  Implementation details such as arrangement for tender invitation, tender assessment procedures and time frame for other preparatory work will be finalised after a final option has been adopted. 

Ends/Wednesday, October 13, 2004
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