PWSC(97-98)106
For discussion
on 21 January 1998
ITEM FOR PUBLIC WORKS
SUBCOMMITTEE OF FINANCE COMMITTEE
HEAD 708 - CAPITAL SUBVENTIONS AND MAJOR SYSTEMS AND EQUIPMENT
Medical Subventions
27MM - Lai King Hospital
Members are invited to recommend to Finance Committee the approval of a commitment of $686.4 million in money-of-the day prices for the construction of the Lai King Hospital.
PROBLEM
There is an overall shortage of infirmary and rehabilitation beds in Hong Kong.
PROPOSAL
2. The Hospital Authority (HA), with the support of the Secretary for Health and Welfare, proposes to create a commitment of $686.4 million in money-of-the day (MOD) prices for the construction of the Lai King Hospital (LKH).
PROJECT SCOPE AND NATURE
3. The scope of the project is to construct a seven-storey hospital building and the associated facilities. The LKH will have -
- 60 infirmary beds and 96 rehabilitation beds; and
- supporting facilities including an Out-patient Department, a Physiotherapy Department, an Occupational Therapy Department, a Radiology Department, a pharmacy, a medical record store, a Central Sterile Supplies Department, a kitchen and general offices.
JUSTIFICATION
4. HA provides infirmary services to patients who are suffering from chronic or terminal illness, and who require continuous medical and nursing care. The majority of these infirmary patients are aged over 65 or above and according to the Census and Statistics Department, this group of population will increase by about 27% from the present level of 655 000 to 830 000 in 2006. The current average waiting time for an infirmary bed is about four years. As a result of the ageing population, we estimate that there will be a steady increase of overall demand for infirmary services in the next decade.
5. HA is now providing about 1 900 infirmary beds and has planned, including this project, to provide an additional 1 200 beds by 2002. This will help alleviate the overall shortage of infirmary beds and increase the ratio of infirmary beds per 1 000 population from the present 2.9 infirmary beds per 1 000 to 4.1 beds per 1 000 by 2002.
6. Medical rehabilitation has become an integral part of curative treatment. With the integration of infirmary and rehabilitation services under one roof, there will be greater operational efficiency and economy of scale brought about by shared use of rehabilitation and supporting services. The provision of both infirmary and rehabilitation beds in LKH will serve to support and complement the acute hospitals in the same cluster - Princess Margaret Hospital, Caritas Medical Centre and Yan Chai Hospital - for the provision of more comprehensive medical care to patients.
FINANCIAL IMPLICATIONS
7. The Director of Architectural Services (D Arch S) estimates the total project cost to be $686.4 million in MOD prices (see paragraph 8 below), made up as follows -
|
|
$ million
|
|
|
(a) Site formation and geotechnical works
|
|
11.8
|
|
|
(b) Building
|
|
167.6
|
|
|
(c) Building services
|
|
153.3
|
|
|
(d) Drainage and external works
|
|
55.6
|
|
|
(e) Consultants' fees
|
|
5.2
|
|
|
(f) Furniture and equipment
|
|
65.6
|
|
|
(g) Contingencies
|
|
45.8
|
|
|
|
_____
|
|
|
Sub-total
|
|
504.9
|
(at December
1996 prices) |
|
(h) Inflation allowance
|
|
181.5
|
|
|
|
_____
|
|
|
Total
|
|
686.4
|
(in MOD prices) |
|
|
_____
|
|
The construction floor area (CFA) of the project is 28 570 square metres. The construction unit cost, excluding "Furniture and equipment" and "Consultants' fees" but including "Contingencies" is $15,194 per square metre at December 1996 prices. A breakdown of the cost estimates for consultants' fees is at the Enclosure.
8. Subject to approval, we will phase the expenditure as follows -
|
Year
|
$ million
(Dec 1996)
|
Price
adjustment
factor
|
$ million
(MOD) |
|
1998 - 1999
|
80.0
|
1.16358
|
93.1 |
|
1999 - 2000
|
150.0
|
1.26830
|
190.2 |
|
2000 - 2001
|
150.0
|
1.38244
|
207.4 |
|
2001 - 2002
|
70.0
|
1.50686
|
105.5 |
|
2002 - 2003
|
54.9
|
1.64248
|
90.2 |
|
|
|
504.9
|
|
686.4 |
|
|
9. We derive the MOD estimate on the basis of the Government's forecast of trend labour and construction prices for the period from 1998 to 2003. We will tender the project under a fixed-pice lump-sum contract for the superstructure works.
10. HA estimates the additional annually recurrent expenditure of the project to be $159.69 million at December 1996 prices made up as follows -
|
$ million
|
|
|
|
|
|
Personal emoluments
|
120.58
|
|
|
|
|
|
Other charges
|
39.11
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
159.69
|
|
|
|
|
PUBLIC CONSULTATION
11. We consulted the Kwai Tsing District Board in July 1996. Members of the board supported the project.
ENVIRONMENTAL IMPLICATIONS
12. In April 1994, D Arch S completed a Preliminary Environmental Review (PER). The Director of Environmental Protection vetted the PER and agreed that the project would have limited adverse impacts on the environment and therefore an Environmental Impact Assessment would not be necessary. The proposed hospital will have air-conditioning to improve the internal noise environment. HA will also implement arrangements for the management, storage, transport and disposal of chemical and clinical wastes as recommended in the PER.
13. For short-term impacts during construction, D Arch S will control dust, noise and site run-off to within established standards and guidelines through the implementation of appropriate mitigation measures in relevant contracts.
LAND ACQUISITION
14. This project does not require land acquisition.
BACKGROUND INFORMATION
15. We upgraded 27MM to Category B in September 1995.
16. We have completed site investigations for the project. D Arch S is now finalising the design drawings using in-house staff resources. We plan to start works in August 1998 for completion in July 2000.
Health and Welfare Bureau
January 1998
Enclosure to PWSC(97-98)106
27MM - Lai King Hospital
Details of Consultants' fees and trading fund charges
|
Breakdown of the estimate for consultants' fees
|
|
Consultants' staff costs
|
|
Estimated man months
|
Average MPS* salary point
|
Multiplier factor
|
Estimated fee
($ million) |
|
(a) Quantity surveying and post-contract services (contract administration, account finalisation)
|
Professional
Technical
|
12.0
12.5
|
40
16
|
3.0
3.0
|
2.0
0.7 |
|
|
|
|
|
_____
|
|
|
|
|
Sub-total
|
2.7
|
|
(b) Charges by the Electrical & Mechanical Services Trading Fund (fees for advice for installation, testing, commissioning and maintenance period monitoring)
|
|
|
|
|
2.2 |
|
(c) Charges by the Office of the Telecommunications Authority Trading Fund (OFTATF) (fees for advisory services on planning, design and installation of telecommunication system)
|
|
|
|
|
0.3 |
|
|
|
|
|
_____
|
|
|
|
|
Total
|
5.2 |
|
|
|
|
|
_____ |
*MPS = Master Pay Scale
Notes
- A multiplier factor of 3 is applied to the average MPS point to arrive at the full staff costs including the consultants' overheads and profit, as the staff will be employed in the consultants' offices. A multiplier factor of 2.1 is applied to the average MPS point in the case of site staff supplied by the consultants. (At 1.4.96, MPS pt. 40 = $55,390 p.m. and MPS pt. 16 = $18,595 p.m.)
- The figures given above are based on estimates prepared by the Director of Architectural Services. We will only know the actual man months and actual fees when we have selected the consultants through the usual competitive bidding system.
- Since the establishment of EMSTF on 1 August 1996 under the Trading Funds Ordinance, government departments are charged for design and technical consultancy services for electrical and mechanical installations provided by the Electrical and Mechanical Services Department (EMSD). The figures above are based on estimates prepared by the Director of Architectural Services. The actual cost for the service charges is subject to further negotiation between the Government and the EMSD.
- Since the establishment of the OFTATF on 1 June 1995 under the Trading Funds Ordinance, government departments are charged for design and technical consultancy services for telecommunication system installations provided by the Office of the Telecommunications Authority (OFTA). The figures above are based on estimates prepared by the Director of Architectural Services. The actual cost for the service charges is subject to further negotiation between the Government and the OFTA.
