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D
XCS(75)1
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6 -
In the longer term, the immediate financial advantage from abandoning the project would quickly be lost, while the damage to the economy and the social disadvantages arising from a hardening of the arteries of communication, as described above, would become more serious as time went on. On the other hand, if the system is built and is eventually paid off, it will thereafter generate considerable surpluses to the ultimate benefit of the community. It must not be forgotten that, if built, the Mass Transit Railway would be the most heavily utilised underground railway for its size in the world and this is another measure of the need for the system.
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Finally, although it can be argued that, over the last twelve months, traffic congestion has eased, this has occurred in a recessionary situation which will be followed by a recovery of the economy's growth rate. In fact, in the late 60s and early 70s, the growth of ownership of private cars (13% to 15% per annum) considerably exceeded the forecast made in the mid-60s by the transport consultants (9% per annum), and this sort of growth rate is expected to resume when the economy recovers. Furthermore, the evidence over the past twelve months has shown that, even in recessionary conditions, the demand for public transport continues to increase. As explained in paragraph 12 above the growth in public transport demand alone is likely, before the mid-80s, to lead to unacceptable congestion in the main corridors to be served by the Railway.
Proposals for a Modified Initial System
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It would appear, therefore, that every effort should be made to build the Railway provided it can be done at a cost that can be afforded. To this end, work has undertaken by a planning team, under the direction of the Chairman designate of the future Mass Transit Railway Corpora- tion, to examine the various possibilities open to the Government and their proposals for a Modified Initial System is at Annex D. The team's proposals and the Provisional Authority's recommendations are dis- cussed in the following paragraphs.
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The Initial System (i. e. the first four stages of the Railway), being the core of the Preferred System (or the whole of the nine stages), was designed in such a way that the last five stages could be added to it when circumstances so permit. In present circumstances, the Initial System contains elements which affect its commercial viability; for example it includes certain civil engineering works and equipment which will not be fully utilised during the first few years of operation and sections of line which, by themselves, do not provide a reasonable return on investment.
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The Provisional Authority has reached the conclusion that a single contract with a price ceiling is now no longer feasible. Experience elsewhere has shown that international contractors are no longer willing to be bound by a price ceiling. In view of this a Modified Initial System which:
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