1
"
e
3.
4.
f.
g.
certain works should be undertaken forthwith, viz ventilation research and soil investigations (two contracts for the latter would be let very shortly) and land and easements should be acquired
a Mass Transit Corporation to contract for and operate
the MTS should be established. It was anticipated this would embody 4 divisions: Finance, Engineering, Administrative and Operations; and would be managed by a Chairman and a board of members
draft legislation should be prepared, viz an ordinance
to establish the MгC and an ordinance to give HK Government compulsory purchase rights in respect of land required for the MTS and in respect of easements.
The MTS Steering Group are to report back on their consultations with the consortia no later than May. The purpose of the consultations with the consortia is to establish whether a single contract approach would be cheap enough. Government have worked out cash flow tables and concern is to ascertain whether consortium price would fall within parameters determined by these tables. Whether
it does or no will largely determine whether or no a consortium approach is adopted.
Government are not seeking to establish whether a consortium approach would be cheapest; they recognise that it would never be possible to demonstrate clearly whether consortium approach was cheaper than a fragmented competitive tender approach but consider on price grounds there is no intellectual argument against the fragmented approach. They recognise also that the consortium approach has considerable advantages for HK Government as regards simplicity and that the fragmented approach would pose a considerable administrative burden on Government
PRICE
5.
6.
7.
Mr Hadden Cave stressed that Government were not asking for a firm price at this date, but were asking where a consortium price might fall and whether it fitted with their own projections. He anticipated that possibly 2 of the Consortia would suggest prices within Government parameters and 2 would fall by the way; he appreciated that a price would be given only with reservations as to assumptions made and these assumptions should be stated.
He
Mr Hadden-Cave said that he believed Government first round discussions with the Javanese (due 26 March) would be mere formality. expected the Japanese to submit pricing in the second round of discussions (scheduled 23 April).
Mr Kindersley expressed the hope that the consortium could persuade Government of the advantages of a consortium approach irrespective of pricing to which Mr Hadden-Cave replied that Government had
a fair idea of these anyway. Mr Kindersley said that the consortium had made some study of the figures in Freeman Fox 1972 report and so far as the civil engineering side was concerned though there were deviations as between sections the overall civil cost seemed of the right order.
2.
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