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Wednesday, June 7, 1972
"If it is favourable, every effort will be made to start construction
early in 1974. If it is not favourable, either because the finance is not
available in sufficient quantities and on appropriate terms or because the
cost turns out to be inordinately high or both, all work on the project will
cease and it will not be proceeded with further".
The Financial Secretary said the Government in taking a firm decision,
in principle, to proceed with the mass transit railway was conscious of the
size of the task, in physical as well as financial terms, it had set itself.
The complete system would take many years to build, though the first
stage would be operational within 3 years from the time construction begins
and the second stage 15 months later.
System
On the basis of mid-1970 prices, the system was estimated to cost
$6,000 million, including accumulated interest over the construction period,
or just over $5,000 million after ploughing back the revenue earned after
the opening of the early stages.
Mr. Haddon-Cave pointed out, however, that construction costs were
rising and could be expected to rise further. He said: "It is bound to be
higher and, indeed, according to our calculations, the net capital requirement
could be considerably higher than this depending on the assumptions made as
regards cost escalation and hence of average costs over the whole construction
period,"
The Financial Secretary said the Government believed that a substantial
sun of public money could be committed to assist in financing the project,
that the system could be constru, sed without undue disruption, and that the
system was economically viable,
/He said