XN000022-1992-05-14 — Page 3

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THURSDAY, MAY 14, 1992

IMPLICIT IN SOME OF WHAT HAS BEEN SAID IN THE DEBATE IS THE IDEA THAT ALL THIS COULD BE DONE AT LESS EXPENSE IF WE PROCEEDED MORE SLOWLY. CALCULATING ECONOMIC DISBENEFITS IS A SCIENCE THAT CAUSES A LOT OF CONTROVERSY AND I SHALL NOT TRY IT HERE: I WOULD RATHER APPEAL TO MEMBERS' COMMON SENSE. WHAT WOULD BE MADE CHEAPER BY SPENDING MORE TIME? BY EXTENDING THE PROJECT CASHFLOWS, WE WOULD JUST INCREASE THE OUT-TURN COSTS. BY EXTENDING THE REPAYMENT PERIOD FOR BORROWING BY THE MTRC AND THE AIRPORT AUTHORITY AND PUTTING OFF THE TIME WHEN OUR INVESTMENTS START TO GENERATE REVENUES, WE SHALL INCUR MORE INTEREST COSTS AND DELAY PAYMENT OF DIVIDENDS BACK TO THE PUBLIC. I AM AFRAID THAT IT JUST DOES NOT MAKE SENSE.

ON THE AWARD OF INDIVIDUAL CONTRACTS, WE WILL CONTINUE TO MAINTAIN A LEVEL PLAYING FIELD. AS THE SECRETARY FOR THE TREASURY SAID LAST WEEK : "THERE IS NEVER ANY FAVOURITISM TOWARDS ANY COMPANY OR ANY COUNTRY. HONG KONG THRIVES AS AN OPEN MARKET WITH FREE COMPETITION, AND THIS PRINCIPLE OF OPEN UNBIASED COMPETITION IS STRICTLY APPLIED BY THE GOVERNMENT WHEN EVALUATING ALL TENDERS". REPEATED ALLEGATIONS AND INNUENDOES TO THE CONTRARY ARE TOTALLY UNFOUNDED. REGRETTABLY THEIR REITERATION WITHIN THIS CHAMBER LENDS THEM A VENEER OF CREDIBILITY THAT THEY IN NO WAY MERIT.

THE TSING MA BRIDGE CONTRACT IS THE LARGEST ACP CONTRACT SO FAR, AND SHOULD BE REGARDED AS A POSITIVE AND ENCOURAGING START TOWARDS ENSURING THAT THE ACP GOES AHEAD AT FULL SPEED, ON TIME, AND WITHIN BUDGET. THE ANGLO-JAPANESE CONSORTIUM'S CONTRACT PRICE OF $7.144BN IN MONEY OF THE DAY IS WITHIN THE ORIGINAL BUDGET. LIKE MOST OTHER MAJOR CONSTRUCTION CONTRACTS ON THE ACP, IT IS ON A LUMP SUM, FIXED PRICE BASIS WHICH GIVES US THE BEST PROTECTION FROM UNFORESEEN PRICE INCREASES DURING CONSTRUCTION.

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IMPRESSIVE PROGRESS IS EVIDENT ELSEWHERE. TENDERS ARE BEING INVITED BY THE GOVERNMENT FOR OTHER ROAD AND BRIDGE CONTRACTS, AND FOR THE WESTERN HARBOUR CROSSING FRANCHISE.

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WEST KOWLOON RECLAMATION IS WELL UNDER WAY, AND

NEW LAND CAN BE SEEN EMERGING FROM THE SEA. TENDERERS HAVE BEEN PRE-QUALIFIED FOR THE FIRST PHASE OF THE CENTRAL AND WANCHAI RECLAMATION. THE TUNG CHUNG NEW TOWN SITE PREPARATION CONTRACT HAS BEEN LET. AND, OF COURSE, ON FRIDAY WE SHALL BE SEEKING FUNDS FROM FINANCE COMMITTEE TO ENABLE WORK TO START ON THE TSING MA BRIDGE BY THE END OF THIS MONTH.

THE PAA HAS ALMOST COMPLETED ITS ADVANCE WORKS FOR SITE FORMATION. TENDERS HAVE BEEN SUBMITTED FOR THE MAIN SITE PREPARATION CONTRACT TO CONSTRUCT THE AIRPORT PLATFORM. THESE BIDS WERE TOO HIGH. SO THE PAA WILL GO BACK TO THEM WITH NEW IDEAS DESIGNED TO BRING DOWN THEIR PRICES A CONCRETE EXAMPLE OF HOW DETERMINED WE ALL ARE TO

CONTAIN COSTS.

THE PAA HAS ALSO DONE A CONSIDERABLE AMOUNT OF OTHER VITAL WORK, BUILDING UP A CAPABLE TEAM FROM VIRTUALLY NOTHING, PRODUCING ITS MASTER PLAN AND FINANCIAL PLAN, AND GETTING WORK STARTED ON THE SITE.

/LET ME