XN000022-1996-05-08 — Page 43

-

- 22 ·

-

(a)

the detailed reasons for exceeding the construction cost of the project by more than 13%;

(b)

the additional expenditure items, and the amounts involved, arising from the inadequacies in the initial planning of the project; and

(c)

the reasons for inadequacies occurring in the initial planning of the project?

Answer:

Mr President,

The Building Committee of the Housing Authority has recently approved a revised estimate of cost of the public housing project in Tin Shui Wai Area 30, Phases 1 and 2, from $1,138 million to $1,299 million, representing an increase of $161 million or 14%. A list of expenditure items, together with revised estimates and reasons, is at Annex (note).

Actual expenditure will depend on the outcome of piling tenders and building tenders to be invited in mid-1996 and early 1997 respectively. The bulk of expenditure will not be incurred until actual construction work begins on the site in October 1996. Hence, there is no question of overspending at present.

For any major project, a rough estimate of cost is made at the preliminary design stage, and the estimate is normally based on broadbrush assumptions since detailed requirements are not yet known. Thus, changes and refinements will be necessary when the project moves to the detailed design stage. The project in Tin Shui Wai is no exception. It is not appropriate, therefore, to suggest that the increase in the revised estimate is attributable to inadequacies in the initial planning stage of the project.

End