Angry builders set to continue airport boycott

PUBLISHED : Thursday, 14 April, 1994, 12:00am
UPDATED : Thursday, 14 April, 1994, 12:00am

ANGRY builders are set to continue their boycott of further airport construction work despite the latest attempt by the Provisional Airport Authority (PAA) to settle its contract conditions row with the Hong Kong Construction Association (HKCA).

Contractors believe the PAA's concessions are significant but still do not resolve deep concerns that firms face unacceptable and costly risks on key contract clauses.

Hopes of a settlement rose after the PAA sent a letter earlier this week to more than 25 firms that are due to submit tenders on Friday for four contracts covering passenger terminal foundations, temporary utilities, water pipelines and site accommodation.

But they were dashed again after the companies last night all pledged to stand together and wait for the HKCA to negotiate a proper agreement with the PAA.

Sources believe the letter was a last-ditch attempt by the PAA to get an agreement with contractors before construction bids are submitted tomorrow.

If the boycott holds and no tenders are lodged the PAA will come under tremendous pressure from Government and legislators to make a deal with the HKCA, politicians believe.

PAA sources denied, though, that it had climbed down.

''We have judged the ways we can be flexible and what we have suggested offers a sensible way forward,'' commented a PAA source.

The letter, which was also sent to the HKCA, explained that the authority was prepared to take a more flexible attitude to its conditions and their effect on contractors.

Specifically, the PAA explained it would limit the extra cost to builders for any additional work because of design changes or ground settlement. It said it would cap the amount of general damages it could levy against contractors.

The letter also said the PAA would clarify the duties and powers of its project managers who would co-ordinate construction.

These managers were usually fully independent engineers who were committed to act in a fair and impartial way. But the project managers, as employees of the PAA, were not obliged to work fairly.

Industry insiders said the PAA's letter was a step in the right direction because ''it indicates the authority is prepared to move on a number of key issues''.

''But the letter is only a set of promises which can easily be bent or broken once contracts are awarded. What contractors want are firm guarantees, which can only come from a properly negotiated agreement between the HKCA and PAA,'' added one source.

The PAA maintains that following the clarification the letter gives its contract conditions are now more akin to similar clauses on Mass Transit Railway and government airport core programme contracts.

It believes if builders are still concerned about certain clauses then they should qualify them with a higher price.

Contractors, though, dispute this.

''The PAA may be right and in principle its conditions could be acceptable, but contractors want to know specifically. Otherwise, they will be exposed to exactly the same risks as they are now,'' commented one contractor.