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LCQ11 : Increases in APE for certain building projects explained

Following is a question by the Hon CHAN Kwok-keung and a written reply by the Acting Secretary for Works, Mr Keith Kwok Ka-keung, at the Legislative Council meeting today (May 22) :

Question :

With regard to the public projects in which the design and supervision work is contracted out by the Architectural Services Department ("ASD") to private architects and the construction work undertaken by private contractors, will the Government inform this Council whether, over the past three years:

(a) there was incidence of the costs of the projects undertaken by such private contractors exceeding the estimated costs; if so, of the excess amount in each project and its proportion to the estimated cost of the project;

(b) there were cases in which the contracted out projects were completed only after the injection of Government funds as a result of shortage of funds on the part of such private contractors; if so, of the descriptions and costs of the projects concerned, and the amount of funds injected by the Government;

(c) ASD has instituted civil proceedings against such private contractors, terminated their employment contracts or blacklisted them due to cost overrun, and the Government having to inject additional funds, or unsatisfactory work progress; if so, of the names of such private contractors and the projects undertaken by them; and

(d) upon taking over completed projects from such private contractors, ASD had to deploy staff to follow up or rectify problems in the completed projects; if so, of the number of such staff and their posts?

Reply :

Madam President,

(a) Over the past three years, Government has increased the Approved Project Estimate (APE) for the following three projects which were contracted out to private architects -


Project Original Excess of increase Reasons

Title APE amount to the APE for


Government $376.9M $14.9M 4% To provide

Quarters additional

at Fanling flats and



which were


under the new


of the






of the


Extension to $72.0M $6.6M 9% To construct

Hong Kong two lay-bys

Chinese for schoolbuses

Women's Club and carry out

Hioe Tjo associated

Yoeng Primary geotechnical

School, Shau works in

Kei Wan order to




new safety


Hong Ning $11.42M $9.5M 83% This was a

Road Park project

(Phase 2) carried out

by the former




The payment

was required

to settle




(b) As explained above, the increases in the APE for these projects were not due to shortage of funds of the contractors involved.

(c) Since the increases of APE for the above three projects were not due to contractors' poor performance, there were no grounds for Government to seek remedies from the contractors.

(d) Architectural Services Department did not need to deploy additional staff resources in attending to problems in the above projects after taking over them from the contractors on completion.

End/Wednesday, May 22, 2002