Following is a question by the Hon Albert Chan and a written reply by the Secretary for the Environment, Transport and Works, Dr Sarah Liao, at the Legislative Council meeting today (April 28):
Question:
In connection with the projects under the Airport Core Programme, will the Government inform this Council:
(a) of the respective total expenditures of various projects as at the end of last month and the differences between the figures and the estimated expenditures originally approved; where there is over-spending, of the organisation(s) to shoulder the extra expenditures;
(b) whether it is aware of the number and amounts of claims ultimately received by the Airport Authority in respect of the relevant construction contracts, together with a breakdown by cases settled and not yet settled; where there is over-spending, of the reasons for that; and
(c) whether it has formulated measures to minimise over-spending and claims in respect of large-scale infrastructure projects in future; if it has, of the details of the measures; if not, the reasons for that?
Reply:
Madam President,
(a) In respect of the Airport Core Programme (ACP) projects, the total expenditure for all government projects under the ACP on a net basis (i.e. after adjustment for reimbursable Airport Railway works and reimbursable Airport works) as at March 31, 2004 was $48,026 million, which is $1,582 million less than the published estimated expenditure of $49,608 million. All funding and expenditure are in money-of-the-day price. There is no over-spending in respect of the government ACP projects.
As at March 31, 2004, the Airport Authority (AA) had expended $49,325 million on the New Airport projects. This is $462 million less than the published estimated expenditure of $49,787 million. There is no over-spending in respect of the New Airport projects.
As at March 31, 2004, the Mass Transit Railway Corporation (MTRC) (now MTR Corporation Limited) had expended $33,477 million on the Airport Railway project. This is $523 million less than the published estimated expenditure of $34,000 million. There is no over-spending in respect of the Airport Railway project.
(b) The AA has received a total of 12,120 claims notifications in respect of construction contracts of the projects led by the AA. All had been resolved, at a cost of $5,622 million. This amount forms part of the above-mentioned total expenditure of $49,325 million for New Airport projects.
(c) To minimise over-spending and claims in public works projects, risk analyses are carried out at the planning stage when preparing project estimates. Comprehensive site investigations are conducted at the design stage to assess the underground conditions as accurately as possible. Where necessary, advanced contracts could be considered to provide detailed information before commencement of some large scale or complex projects to ensure that workable solutions are available. Guidelines are also being prepared for the preparation of comprehensive risk management plans throughout the entire project delivery process. In recent years, we have further introduced new measures to avoid contractual claims. Partnering approach has been used to promote a dispute avoidance culture in the construction contracts. Dispute avoidance techniques are also used in managing construction contracts.
Ends/Wednesday, April 28, 2004
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