Building materials given a bad rap in rail project inflation

PUBLISHED : Tuesday, 11 January, 2011, 12:00am
UPDATED : Tuesday, 11 January, 2011, 12:00am

The estimated cost of the fourth cross-harbour railway, connecting the northeastern New Territories and East Kowloon to Hong Kong Island, is up 60 per cent from a 2007 estimate ... Officials have attributed the increased cost to a surge in the price of construction materials.

SCMP, January 8

Yeah, blame it on the costs of materials. That way no one is really to blame. It just happened to happen and there is nothing anyone can do about it. We'll just have to pay up. Sorry, but that's the way the cookie crumbles.

Before invoking this excuse, however, you would have thought that these 'officials' might check to see whether it is actually true that the costs of construction materials have gone up quite so much since 2007. They could easily have found out from a number of detailed data series published by the Census and Statistics Department.

But did they look?

No, of course they didn't or, if they did look, they ignored what they saw in favour of a number given them by the construction trade. The real figure is about 22 per cent since mid-2007, not 60 per cent, and this is in construction materials costs alone. Construction wages have been flat since that time.

The chart tells you the story. It represents an aggregate price index of 19 construction materials used in the public sector. Materials prices went way up in 2008 with global financial troubles but then came down again with recovery and are still below the 2008 peaks. Someone needs to tell certain officials that 2011 is not 2008.

I think I know what happened here. The consultants, civil engineers and construction companies that will be employed in this new Sha Tin to Central Link saw how quickly the government said yes last year to HK$67 billion for a high-speed railway to the border, up from HK$15 billion initially.

They saw it and they said, 'Well, why not us, too?'

I fully understand the reasoning. When easy money is being scattered around, why make life difficult for yourself? Pick a nice round number, a big one, 60 per cent will do, blame it on concrete and steel prices and then wait to see if 'officials' will fall for it.

If government did not conduct any prior studies on that high-speed railway (and it didn't), why should it now ask embarrassing questions about costs on the Sha Tin to Central Link? Good reasoning, as I say, and likely to be successful too.

Legislator Regina Ip Lau Suk-yee yesterday inaugurated the New People's Party, pledging to chart a new path for 'a quality democratic system' and economic growth.

SCMP, January 10

I know why the cornerstone of China's constitution states that the communist party is boss and anyone who tries to challenge it is in deep trouble.

It has to be that way because this is a part of the world where if you put any three people in a room you will get seven different political parties. Just shuffle the deck and the same old talking heads that you thought had long talked themselves out suddenly become New People and form another party.

But if the party has a manifesto it has also done a wonderful job of keeping it secret. I can't even find a website. All I see is a Wikipedia entry that says: 'New People's Party is a political party in Hong Kong. It was established on 9 January 2011. It is led by Regina Ip'.

Well, God save the Queen.

For further enlightenment we have vice-chairman Michael Tien Puk-sun saying that many Hong Kong people 'cannot find a party to truly represent them', this from a man whose most notable coup in public service was to set off a management rebellion against himself when he was chairman of the Kowloon-Canton Railway. So you're now the people's choice, are you, Michael? How interesting.

What this pseudo party needs to understand about real political parties is that policy comes before party.

It won't do to say that you will be flexible and make it up on the run by listening to the public. You will just get as many different opinions as you have members of public. You must have a coherent platform to offer the public.

This is, of course, if you have any platform other than to do what Beijing wants you to do while denying all the time that you are Beijing's lapdog.

Yes, on second thoughts, Regina, you might as well skip that platform. God save the Queen will do.