Contractors urged to break the ban on airport work

Keith Wallis

CONTRACTORS embroiled in a contract conditions row with the Provisional Airport Authority (PAA) are being encouraged to break ranks and end their boycott of airport construction work.

Today 26 firms shortlisted for four advance works contracts will receive a letter from the PAA giving its detailed response to three days of talks with the Hong Kong Construction Association (HKCA).

They will also be told the PAA has accepted a proposal by the HKCA to further delay the return tenders for the four contracts until April 27. They were supposed to be back tomorrow.

The discussions ended in disarray yesterday after the two sides failed to agree on a mechanism to resolve construction disputes even though there were tentative agreements on four other important conditions.

These cover the powers of PAA project managers, extra work caused by design changes and ground settlement and limits on the amount of damages that would be payable for sloppy workmanship.

The HKCA said proper dispute resolution measures are central to solving the row.


It said that without a settlement on dispute resolution a deal on all the other issues would be meaningless because it would allow the PAA to reintroduce its most onerous conditions once construction was under way.

Contractors, who asked the HKCA to negotiate an agreement with the PAA a week ago, later endorsed the HKCA's view and said they would maintain their united front and continue to boycott PAA contracts.

Nevertheless, the PAA believes there is growing dissent among some contractors who want to accept a deal with the PAA and could be willing to break the ban.

A PAA insider refused to say whether this feeling was based on any particular reaction from contractors.


He also denied the PAA's explanation document is meant to drive a wedge between the HKCA and its members.

''It is not a specific attempt to divide and rule,'' he said.


''But our basic relationship must be with our contractors and we feel we must have an opportunity to put our revised terms to them. We want to present the revised conditions as a package and let contractors judge for themselves whether they are acceptable.'' He added there are no further meetings planned by the two sides.

The HKCA wants the PAA to use the same dispute resolution measures the Government has on its airport core projects which allow for mediation and adjudication to take place while construction continues.

The PAA said the HKCA's suggestion was against the public interest, although it acknowledged it was prepared to adopt a similar but less formal system.


''The PAA's attitude is crazy. If it is prepared to accept the concept of resolving disputes during construction, why is it not prepared to accept the proper binding method of alternative dispute resolution? Why is this such a problem for them? So far they have not offered any proper explanation,'' said a construction source.

Meanwhile, Douglas Oakervee, PAA's project director and James Blake, the Secretary of Works, met yesterday to discuss the row.

Mr Blake, a former contractor and consultant, agreed the PAA and HKCA had made substantial progress during their talks but he would not be drawn on whether, if he was still in the industry, he would accept the PAA's conditions.