On visits to my friends during the Lunar New Year, many of them asked me whether the new year wishes I made in my blog on the second day of the Lunar New Year, i.e. that all people-oriented public works projects would be launched smoothly in the new year, would come true. Given the endless wrangle in every meeting of the Legislative Council (LegCo) Public Works Subcommittee (PWSC), the current situation is indeed worrying.
No ray of hope amid endless arguments
An additional meeting of the PWSC was held on the seventh day of the Lunar New Year to scrutinise the application for block allocations under the Capital Works Reserve Fund for 2017-18. However, most of the time in the meeting was spent discussing whether to adjourn the meeting, and consequently there was still no good news for the public. One of the points at issue was why the Government insisted on having the block allocations scrutinised as a whole and refused to withdraw some of the items. I believe that some of the younger LegCo members and the public may not clearly understand the origin of the block allocation arrangement. Now, let us trace its history together.
Effective funding arrangement
The Chinese and British governments discussed the future of Hong Kong in the 1980s. In this context, the resolution to establish the Capital Works Reserve Fund was passed by the then Legislative Council in 1982 for the purpose of financing public works and land acquisition. Since then, all capital works projects have been financed by the Fund upon LegCo’s approval. However, when LegCo members examined the items one by one, the Government had to provide relevant basic information and technical data with a view to soliciting funding support. Therefore, before a project secured approval from LegCo, a flexible funding arrangement was necessary for conducting advance work such as feasibility studies and ground investigations. At the same time, as there were thousands of such feasibility studies and advance works projects, the block allocation mechanism of providing one-off grants has been adopted since 1983 to enable LegCo to make more effective use of the meeting time to deliberate on larger-scale projects. At present, the Government can flexibly deploy funding under block allocations to finance projects with an individual budget not exceeding $30 million, including minor works projects, without having to scrutinise the items one by one. This is a well-established mechanism that allows LegCo to proceed with its work effectively. In the past few years, the PWSC only managed to scrutinise about 50 projects each year. It is virtually impossible to request individual deliberation of thousands of items included in the block allocations.
As always, in the application for block allocations of about $12.4 billion submitted this year, the Government has listed more than 9 000 items of ongoing and proposed projects so that LegCo members can understand the breakdown of the overall estimates whereas individual items are not intended for deliberation one by one.
Delay in funding approval undermines public safety
Block allocations are mainly used to cover payments for feasibility studies, advance works projects as well as some minor works projects, such as the Universal Accessibility Programme, drainage, water works and road maintenance works that are closely related to people’s livelihood, and landslip prevention works which affect public safety. Without funding, all these works will not continue after 1 April and public services will be seriously affected. If, unfortunately, there is a major road subsidence on Nathan Road, even though the Government can carry out some emergency and temporary reinforcement works and traffic diversion measures, there will not be enough funding to carry out large-scale works such as backfilling and road repair works in a timely manner to restore traffic. Besides, ongoing landslip prevention and river training works will also have to stop despite the approach of the wet season. As a result, the Government cannot enhance public safety as planned, and may be even forced to suspend ongoing works in unsafe conditions. For example, slopes having been excavated will be washed away by rain without proper protection and management, making them highly susceptible to collapse that will seriously threaten the lives and properties of the public. In addition, some ongoing road works may have to be suspended immediately and consequently delay the resumption of traffic, while related temporary traffic diversion measures without proper management may also pose danger to road users.
Industry suffers due to the suspension of projects
With some 8 000 ongoing projects under block allocations, it is estimated that more than 10 000 workers and practitioners will face suspension or non-payment of wages or even layoffs if these projects fail to obtain funding in time. As the wages of some of these personnels are paid directly from the block allocations, they will definitely stop getting paid immediately and have difficulty making their ends meet. We also anticipate that hundreds of consultants, contractors and sub-contractors, the majority of which being small and medium enterprises, may also face liquidity issues, financial difficulties or even closures due to defaults on payments by the Government in breach of contracts.
Comprehensive studies facilitate discussion
We understand that at present, LegCo members are mainly concerned with the feasibility studies or advance works for some of the strategic projects under planning. In general, large-scale works projects are required to first carry out feasibility studies or advance ground investigations (advance work) to obtain actual and scientific data for assessment and analysis, so as to draw up preliminary schematic proposals, budgets and details for the main projects. Such advance work is indispensable as it can provide more comprehensive and complete information and justifications for reference by LegCo members and the public when funding proposals are submitted to LegCo for deliberation in future. In fact, when projects were scrutinised in the past, LegCo members often requested government officials to provide more data for reference. The project of site formation and infrastructure works for public housing developments at Chung Nga Road in Tai Po just endorsed by the PWSC serves as a good example, which enables us to better understand the importance of advance work in the subsequent deliberation process. During deliberation by LegCo, the Government submitted technical reports regarding the traffic impact assessment and baseline impact assessment of air quality as requested by LegCo members, so that they could have a better understanding of the details. The funding application was endorsed by LegCo members eventually. Can the Government solicit LegCo members to approve a funding proposal without supporting data? However, we have to clarify that to carry out advance work for projects under planning does not mean that their construction in future has already been firmed up. There is still plenty of room for the public to discuss and to reach a consensus. We should set aside our prejudices and let the advance work get started first, so that the public can have a clearer view of the future before making a final decision.
Rational communication leads to success
Despite the current deadlock, many have expressed their understanding of the Government’s approach and given us encouraging words, like “Stand firm and have a clear conscience”. The Government will make earnest efforts to continue to carry out rational communication with LegCo members both inside and outside the chamber and address their concerns. I believe that the Government and LegCo members all strive to make concerted efforts to serve the public. I hope that LegCo members will understand the Government’s arrangements and justifications regarding the funding application for block allocations and, given the urgency of the issue, endorse the funding proposals as soon as possible.
12 February, 2017
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