TNAG-1415-FCO40-1896-Public-finance-in-Hong-Kong-1985 — Page 196

contract was awarded to a local contractor. The overseas contractor carried out the design work in his office in the United Kingdom and normally liaised with the Civil Engineering Office in Hong Kong through the consultants' office in the United Kingdom. The nature of these arrangements required good co-ordination through all stages of the project, in particular during the construction stage as the erection of the plant could not commence until the civil works directly associated with the plant were completed. Unfortunately the co-ordination was less than satisfactory. There was a total delay of 37 months in the completion of the project and a substantial part of the claims totalling $7.1 million resulted primarily from the less than satisfactory co-ordination.

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Following the audit review I made a number of recommendations to the Director of Electrical and Mechanical Services and the Director of Engineering Development, highlighting in particular the problems of co-ordination in the Kwai Chung incinerator project. I suggested that the project management for similar projects undertaken in future should be reviewed and that the responsibility for project management and co-ordination of the various activities should be clearly defined and agreed at the outset, and in so far as practicable be vested with one single office. I expressed the view that the appointment of a 'lead' office as the project manager to oversee the whole project should provide much better co-ordination and avoid unnecessary delays and resultant claims. I quoted as an example the practice adopted by the Water Supplies Department which is a multi-disciplined department where a Chief Engineer normally assumes the role of project manager (and Engineer under the terms of each contract) for a project such as a treatment works project which involves both civil and plant contracts. I pointed out that the Kwai Chung incinerator project was the type of case the Technical Audit Unit of the Public Works Department was referring to when it made a recommendation as far back as 1968 concerning the building up of a special 'Team' or 'Section' for projects involving multi-engineering or multi-works disciplines. I also pointed out that this was another example which justified the concern expressed by the Public Accounts Committee in their general conclusions and recommendations at paragraph 7.1 of their Seventh Report, over the problems of co-ordination which could arise where several departments or agencies were involved in a single project or programme area. The Committee stressed the need in such cases for a 'lead' department to be designated, and for financial responsibility to be aligned with administrative and executive responsibility as it seemed to the Committee that this was the only way to ensure both effective management and proper accountability.