Billions could be shaved off Hong Kong’s huge major projects bill
Set up earlier this year, the Project Cost Management Office has identified savings in the city’s infrastructure and public works projects
A newly set up government task force has identified cost-cutting measures that could save billions of dollars on major public works projects, according to Hong Kong’s development chief.
Secretary for Development Paul Chan Mo-po said the Project Cost Management Office, which was unveiled by Chief Executive Leung Chun-ying in his Policy Address earlier this year, had found areas where costs could be reduced in close to 40 projects in the last two months.
The body was set up in June to address significant cost blowouts in some major projects, including the Hong Kong-Zhuhai-Macao Bridge, the Hong Kong section of the Guangzhou-Shenzhen-Hong Kong Express Rail Link and West Kowloon Cultural District, and other rising construction costs.
In his weekly blog, Chan also said the office would continue to review 300 projects being planned or designed over the next three years to ensure that public money was well spent.
He said the capital works expenditure for the development of land, transport network, hospitals, schools and other large-scale infrastructure projects in recent years exceeded HK$70 billion annually, and that spending was expected to remain at similar levels for the next few years.
“Compared with other regions, our construction costs are higher, with reports saying construction costs in Hong Kong are ranked top three in the world along with London and New York,” Chan said. “Therefore, we need to ensure good cost management of public works.”
Tony Tse Wai-chuen, lawmaker for the Architectural, Surveying and Planning constituency, said the newly established office had shown “encouraging” results so far, but he would need to see if it continues.
Chan said the government would not sacrifice the quality of construction safety and engineering requirements despite the savings focus on major projects.
“Recently, there were claims that the streamlining of the Pay for Safety Scheme was to cut cost and some even saying that the government was sacrificing the safety of workers,” he said.
The Secretary for Development said the recent changes to the scheme, which has been around for many years, were aimed at weeding out dated practices to increase efficiency.
He said a review of the scheme was expected to be completed at the end of this year or next year.