DSSOPT studying feasibility of compensatory clauses

Technical analysis and thorough research need to be conducted with regard to introducing compensatory clauses to the current system of public works contract, said Li Can Feng, Director of the Land, Public Works and Transport Bureau (DSSOPT) in a written reply to legislator Si Ka Lon’s enquiry. Legislator Si submitted a written enquiry on the current direction of introducing compensatory clauses into public works contracts and what new measures can be set up to avoid indefinite delays of public projects, given several have been consecutively delayed with budget overruns, including Mong Ha Social Housing, the construction of the Light Rail Transit (LRT) system in Taipa, Pac On Ferry Terminal in Taipa, and Zone A project. The DSSOPT Director said in his reply that regarding the legislator’s suggestion the authorities have been studying the technical details and legal feasibility of introducing such clauses to the current system. He added that except for rainy weather affecting the public projects to be finished on time, other reasons resulting in delay include contractors failing to allocate resources to construction and failing to execute the original plans, etc. Thus, the government had extended the period of public projects based on the law. The government now follows the strengthened requirements to supervise contractors in order to speed up construction, with the law to be strictly enforced to penalise contractors by imposing penalties. In addition, they are required to submit a progress report on projects to the DSSOPT by the agreed deadline. If the contractors are found not to have fulfilled the project’s duties, the relevant penalties will be enforced. In March, during a Legislative Assembly debate, Secretary for Transport and Public Works Raimundo Arrais do Rosário said that the government is inclined to maintain the current system of public works contract, which mandates punitive clauses rather than compensatory clauses. The Secretary said at the time that the current system “is not necessarily worse” and changes would take time to make.