TNAG-0424-FCO40-470-Construction-of-an-underground-railway-system-in-Hong-Kong-1973 — Page 118

CONFIDENTIAL

Annex A

PROPOSED RESPONSE BY THE M & E SUPPLIER TO MR.

HADDON-CAVE'S LETTER OF 1ST AUGUST 1973

The Chairman has said that the response to the requirements

listed under paragraph 4(a) to (e) on page 2 of your letter

of 1st August will differ in some important respects as between

Civil Construction work and M & E manufacture installation and

commissioning. My purpose is to give you as clear and as short

a response as possible from the M & E side of the British Group

to the requirements referred to above,

Ceiling Price

In our proposals of May 1973 and in discussions with you in June

we stated that we would quote you firm prices for the supply

installation and commissioning of the total M & E supply subject

to availability of specification, your acceptance of an agreed

international escalation formula and acceptable Contract

Conditions. This offer still stands, However the acceptance

by us of a predetermined ceiling price before the M & E design

is completed or in some cases even started, ie, Ventilation, as

a criterion against which we could qualify for the contract or

be disqualified if we don't meet it, is only possible if the

en suclerable CONSIDERABLYSteering Group accept it flexibility in design whereby

quality and quantity of supply can be adjusted to meet such a

predetermined firm price figure, While we do not know the

proportion of the HK$5,000M attributable to M & E we would

question the relevance at this stage of any precise ceiling

figure calculated from an assessment of the Consultants prices

before the completion of the detailed design of the M & E

system,

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