In recent years, suspected bid-rigging in private building repair and maintenance works has drawn public attention. The Government is also very concerned about the issue. The Chief Executive mentioned in his Policy Address last Wednesday (January 13) that the Urban Renewal Authority (URA) will launch a pilot scheme to strengthen technical support to property owners in order to reduce the risk of bid-rigging. Let me explain here.
While we encourage owners to proactively fulfil their responsibility for properly repairing and maintaining their buildings, we understand that many of them lack relevant knowledge and experiences. Few owners with ulterior motives and unscrupulous dealers in the building repair and maintenance industry might then take advantage of them and profiteer through improper means. In view of this, we have earlier collaborated with the URA, the Hong Kong Housing Society (HKHS) and other organisations to implement the Operation Building Bright (OBB) scheme, the Integrated Building Maintenance Assistance Scheme and other measures. In addition to providing financial assistance, we also rendered technical support to property owners, so that they can make informed decisions in building repair and maintenance works, reducing the risk of bid-rigging.
For example, the URA and the HKHS arrange independent professionals to provide valuation of repair and maintenance costs for owners of buildings under their support schemes. The valuation can be a reference for the owners in assessing whether the tender prices are comparable with market levels before selecting a suitable tender. I also noticed recent news reports on a building repair and maintenance case, in which the contractor’s bid was more than double the valuation by independent professionals and the bid was ultimately rejected by the majority of owners. I think this case reflects the effectiveness of independent valuation which empowers owners to make informed decisions.
As I wrote in my blog earlier, the OBB scheme has implemented new tendering arrangements since 2013 to ensure an open and fair tendering process without interference. Boosting bidders’ confidence and encouraging active bidding, the arrangements enable property owners to identify a reasonable and practical offer from competitive bids. According to URA’s information, the number of contractors interested in bidding has increased by twofold to threefold after the introduction of the new tendering arrangements, and valuations by the bidders were also closer to those by independent professionals. In light of this, we propose to extend technical support to other property owners as well. The URA will launch a pilot scheme in the second quarter of this year to render technical support to participating owners. The scheme will encompass the following three areas:
First, the URA will provide a “DIY tool-kits” to help participating owners organise building repair and maintenance works. The tool-kits will include guidelines and pro-forma documents to facilitate them in hiring professional consultants in accordance with proper procurement procedures to assist in formulating appropriate project scope and requirements as well as monitoring works progress. The tool-kits will also include other instructions and useful tips to owners.
Second, the URA will arrange professionals to give independent advice to participating owners. Before calling tenders, owners will be advised on the general aspects and projected expenses of the works to be carried out so that they could evaluate whether the received tenders are reasonably priced.
Third, the URA will set up an electronic tendering platform for property owners to conduct tendering exercises for the appointment of contractors. Invitation and submission of expression of interest, as well as issuance of tender documents will be completed on this platform. Identity of bidders will be secured before tender opening. This would help reduce the risks of manipulation and interference in the tender procedures by people with ulterior motives.
The URA will make further announcements once details of the pilot scheme are finalised. Property owners’ active participation in building repair and maintenance works is essential in preventing and combatting bid-rigging, without which neither the pilot scheme nor other supportive measures could achieve any results. We would work hand-in-hand with property owners in repairing and maintaining old buildings and eliminating bid-rigging syndicates so as to create a better living environment for all.
17 January, 2016
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