TNAG-2412-FCO40-3507-Hong-Kong-Port-and-Airport-Development-Strategy-(PADS)-pres-1992 — Page 42

I

OVERALL COSTS (Paper handed 1992. Handed to ACC on 2 April)

Main features

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over to Chinese on 27 March

The total cost of the ACP has gone up since July 1991 from $98.6 BN to $112.2 BN (1991). The net increase in real terms in the cost of the ACP is $13.6 BN or 13.8%

The cost to the Government (direct works contract costs and equity investments) has not gone up : it remains at $59.3 BN (1991) made up of $45.6 BN in public works costs plus $16.6 BN (1991) in paid up equity, minus $2.9 BN (1991) in

reimbursements from the MTRC.

The present and future Governments will need to

accept some commercial investment risk in the form of a commitment to callable equity for the MTRC and the AA.

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We

overall

now estimate we shall need an additional

ACP contingency allowance of $2.5 BN (1991) to cover contract delay and interface problems for the Government projects in the ACP.

Points to make

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We

have

now reached a more advanced planning stage. We have more confidence in these figures than last year's ones. We believe future increases in the cost of Government works can be kept within an overall contingency allowance of $2.5 BN (i.e. to within $2.5 BN of the $45.6 BN to be spent by Government on public works.)

We have set up a system. The degree

greater than for projectsin the past.

rigorous cost control of discipline is much normal public works

It would be unrealistic these costs were final.

to suggest that