PWSC(1999-2000)6
For discussion
on 28 April 1999
ITEM FOR PUBLIC WORKS SUBCOMMITTEE
OF FINANCE COMMITTEE
HEAD 703 - BUILDINGS
Fitting-out - Social Welfare
| 66IS - | Refurbishment of Social Security Field Units and fitting out of a Central Casefile Depository in support of process re-engineering under the Computerised Social Security System of Social Welfare Department |
Members are invited to recommend to Finance Committee the upgrading of 66IS to Category A at an estimated cost of $112 million in money-of-the-day prices for the refurbishment of Social Security Field Units at various locations and the fitting out of a Central Casefile Depository in support of the process re-engineering under the Computerised Social Security System of the Social Welfare Department.
PROBLEM
The existing layout and accommodation in the Social Security Field Units (SSFUs) of the Social Welfare Department (SWD) cannot cope with the re-engineering and service improvement requirements for implementation of the Computerised Social Security System (CSSS) in SWD.
PROPOSAL
2. The Director of Architectural Services (D Arch S), with the support of the Secretary for Health and Welfare, proposes to upgrade 66IS to Category A at an estimated cost of $112 million in money-of-the-day (MOD) prices for the refurbishment of 35 SSFUs at various locations and the fitting out of the Central Casefile Depository (CCD) for the implementation of CSSS in SWD.
PROJECT SCOPE AND NATURE
3. The project comprises the following refurbishment works of SSFUs and the fitting out of the CCD -
- major re-fitting of 16 existing SSFUs 1 to provide an adequate number of interview rooms equipped with computer workstations and printers. The works will involve complete re-arrangement of the office layouts in these SSFUs, demolition of existing partitions, re-partitioning, essential redecoration and replacement of floor finishes and false ceiling in the affected areas. Old style furniture will also be replaced as part of the re-fitting;
- fitting-out of 7 reprovisioned SSFUs 2 , comprising office partitioning, associated building services alignment, provision of false ceiling and floor finishes, general redecoration and upgrading of power supply (if necessary only), to provide an adequate number of interview rooms equipped with computer workstations and printers and for the open plan office area;
- minor re-fitting of 12 SSFUs 3 including the provision of a sufficient number of power points, computer nodes and necessary trunking work for the installation of computer workstations and printers in these offices; and
- fitting-out of a new CCD in Kowloon City 4 including the provision of all furniture, trunking, power sockets and equipment.
Justifications
4. The SWD is implementing an Information Systems Strategy, which aims at improving operational efficiency and enhancing productivity gains through re-engineering of work processes and automation. As the first phase of the implementation programme, the Finance Committee approved on 28 November 1997 funding for the development and launching of the Comprehensive Social Security System (CSSS).
5. The CSSS is a fully automated system connecting 1 200 workstations at 35 SSFUs and a number of offices in the SWD headquarters. The system will provide on-line functions for data input, retrieval, processing and comprehensive management information in addition to its payment functions.
6. The implementation of CSSS will enable SWD to reap the following benefits -
- Staff savingThe new system will reduce considerably manual processing of applications. This will result in a deletion of about 100 posts upon implementation, equivalent to $38.49 million per annum at 1998-99 staff cost level. A recent study by the Management Services Agency (MSA) has established the possibility of further staff savings. A full scale study will be conducted by the MSA after the implementation of CSSS to establish the actual realisable savings.
- Reduction in space requirement for back office
As a result of the on-line data input and retrieval function of the CSSS, there is no longer a need to keep all the original paper records in SSFUs. Instead, the records will be moved to a central casefile depository. This would release much needed space to be turned into case processing area and counters which will be equipped with CSSS workstations. The better utilisation of office space would lead to reduced need to rent commercial premises as offices and hence bring about annual savings in rental of up to $3 million. The refitting of the SSFUs is required to support the new mode of operation under the CSSS environment and to cope with the ever-increasing number of social security applications.
- Service delivery enhancement
- With the provision of more counters and interview rooms and the support of CSSS, the case processing time will be shortened and response to enquiries will be faster, thus reducing clients waiting time. As a result, 90% of customers could be attended to within five minutes as compared with the current performance pledge of attendance in ten minutes.
- The on-line data input function of the CSSS will prompt case workers to collect all necessary information during the interviews, thus reducing the number of visits to the SSFUs that a client has to make for an application due to insufficient information. We expect that 90% of straightforward applications such as Old Age Allowance cases with all supporting documents available could be completed within the same day as against the present time frame of five days. This will also help expedite the processing of other applications, thus reducing the lead time for first payment. We expect that the standard authorisation period for disbursement of social security payments could be shortened from four to three days.
- Protection of personal information
In processing applications for social security, clients are required to provide a lot of personal information including particulars of family members, incomes and assets. The provision of interview rooms equipped with CSSS workstations for on-line input of data is intended to enhance privacy for the clients, whilst reducing paper records and storage space.
7. Further improvements that can be achieved under the CSSS mode of operation include enhancement of processing accuracy, provision of a more efficient case auditing mechanism, accurate measurement of performance and speedier provision of management information.
8. The proposed refurbishment programme is required to make this service improvement plan possible. Without refitting the SSFUs to take full benefit of the office space released as a result of removing the paper records, there is not enough space to accommodate all the CSSS workstations and additional interview rooms. Hence, most of the anticipated benefits under the CSSS including the service delivery enhancement and committed staff savings cannot be realised. Therefore, it is imperative that funds be approved for the refurbishment programme to proceed to tie in with the implementation schedule of CSSS, which is scheduled for operation on 3 October 2000.
9. To facilitate the reform of the operation environment from the existing Social Security Payment System (SSPS) to CSSS, the internal office layouts of all the 16 existing SSFUs mentioned in paragraph 3(a) above are to be totally rearranged. The works involve overall and complete re-fitting-out/refurbishment of these offices. As the SSFUs are to remain in full operation to serve the public during the construction period, works have to be implemented in phases for which additional temporary works, night works and more service diversion works are required. Also, in the cases where the SSFUs are situated in leased commercial buildings, the alteration/refurbishment works have to be carried out in accordance with certain conditions imposed by the landlords. Given that there are constraints on the way the major re-fitting out works for the 16 SSFUs can be implemented, the unit cost of the works may be somewhat higher as a result. We have explored alternative implementation strategies for these 16 SSFUs in order to keep the volume of the aforesaid temporary works, night works and service diversion works to the minimum. We have also considered temporary closure of the affected SSFUs during construction period and referring all applicants/clients either to other SSFUs nearby or to the temporary SSFUs of the respective catchment regions set up for the works period. However, as most of the customers are elderly, disabled, or in ill health, this option would cause unnecessary confusion and difficulties to the customers. We therefore do not consider it feasible from an operational point of view.
10. As regards the 7 SSFUs to be reprovisioned, the requirements of fitting out works have been kept to the minimum necessary. Customer services at these SSFUs will not be interrupted as the present locations will cease operations only upon the commissioning of the new locations. As regards the 12 SSFUs which require minor re-fitting only, we have also reviewed the amount of works involved and kept it to the minimum necessary.
FINANCIAL IMPLICATIONS
11. We estimate the capital cost of the project to be $112 million in MOD prices (see paragraph 13 below), made up as follows -
| $ million
|
|---|
| (a) Building (fitting-out works)
| 40.3
|
| (b) Building services
| 46.0
|
| (c) Furniture and equipment
| 2.8
|
| (d) Charges by Electrical and Mechanical Services Trading Fund (EMSTF) 5
| 7.4
|
| (e) Contingencies | 9.7
|
| ________
|
| Sub-total | 106.2 | (at December
1998 prices)
|
| (f) Provision for price adjustment | 5.8
|
| ________
|
| Total | 112.0 | (in MOD prices)
|
| ________
|
12. The total gross floor area (GFA) of the 35 SSFUs is 16 527 square metres and the average unit cost of fitting out these units, represented by building and building services costs, is $4,589 per square metre at December 1998 prices. The GFA of the CCD is 3 320 square metres 6 and the unit cost of fitting out this Depository, represented by building and building services costs, is $3,163 per square metre at December 1998 prices. We consider these fitting-out unit costs reasonable compared with the average fitting-out cost of similar projects.
13. Subject to approval, we will phase the expenditure as follows -
| Year
| $ million
(Dec 1998)
| Price
adjustment
factor
| $ million
(MOD)
|
|---|
| 1999 - 2000 | 32.0 | 1.02625 | 32.8
|
| 2000 - 2001 | 64.0 | 1.06217 | 68.0
|
| 2001 - 2002 | 10.2 | 1.09934 | 11.2
|
| ______ | | ______
|
| 106.2 | | 112.0
|
| ______ | | ______
|
14. We derived the MOD estimates on the basis of the Government's latest forecast of trend labour and construction prices for the period 1999 to 2002. In view of the tight work programme, we will implement the project under the design-and-build fitting-out term contracts, where the contractor will be responsible for the detailed design and fitting-out works and will operate within firm and precise parameters and a cash-limited budget set by Government. We will define the scope and requirements of the project in sufficient detail to ensure that the contractor understands and complies with the requirements of the contract.
15. The project will not give rise to any additional annually recurrent expenditure.
PUBLIC CONSULTATION
16. As all the proposed works will be carried out within the existing offices of SWD, we consider there is no need for public consultation.
ENVIRONMENTAL IMPLICATIONS
17. D Arch S engaged consultants to conduct a Preliminary Environmental Review (PER) in February 1998 which concluded that the project would have no adverse environmental impacts. The Director of Environmental Protection (DEP) vetted the PER and agreed that an Environmental Impact Assessment would not be necessary. D Arch S will conduct a survey to assess the possible disturbance of asbestos containing material (ACM) in various buildings due for demolition work, and will remove and dispose of any ACM, prior to the commencement of any demolition or improvement works in strict compliance with relevant statutory requirements, codes of practice and guidelines. We will control noise, dust and site run-off nuisances during refurbishment through the implementation of appropriate mitigation measures in the relevant works contracts.
LAND ACQUISITION
18. The project does not require land acquisition.
Background INFORMATION
19. We upgraded 66IS to Category B in October 1998. Subject to approval, we will commence the refurbishment and fitting-out works in May 1999 for completion in June 2000 before the live run of the CSSS in October 2000.
20. We submitted a paper (PWSC(98-99)67) to the Public Works Subcommittee on 24 February 1999 proposing upgrading of 66IS to Category A. In the course of discussion, Members expressed concern on the relatively high fitting-out cost of the project. They also sought supplementary information, in particular on the anticipated improvements and savings to be effected by the project. The paper was withdrawn in light of Members' comments. We have critically reviewed the requirements of the project to keep the cost estimate to the minimum amount necessary. We have also decided to locate the CCD to another location to take advantage of the lower cost requirements. The relevant information on the benefits of the system requested by Members is now provided in paragraph 6 above.
URGENCY
21. We need to obtain Finance Committee's approval of this project as soon as practicable so that the refurbishment works could start early to tie in with the development programme of the computer system which is already well underway. In view of the urgency, and subject to Members approval, we intend to submit this item to Finance Committee earlier for consideration at its meeting to be held on 7 May 1999 rather than at the meeting on 21 May 1999 in accordance with normal procedure.
---------------------------------------
Health and Welfare Bureau
April 1999
(PWSC0118/WIN4)
1 The names of these 16 SSFUs are Butterfly, Central/Western & Islands, Kowloon City, Mongkok, San Po Kong, Shatin South, Shek Kip Mei, Tokwawan, Tsz Wan Shan, Tsing Yi, Tsuen Wan, Wan Chai, Tai Po South, Yuen Long East, Criminal and Law Enforcement Injuries Compensation (CLEIC) Section and Traffic Accident Victims Assistance (TAVA) Section.
2The names of these seven SSFUs are Aberdeen, Yuen Long West, Shatin North, Kwai Chung East, Lam Tin, Sai Kung and Ngau Tau Kok. Since the previous PWSC submission of 66IS on 24 February 1999, the Administration has decided to re-provision these seven SSFUs in due course.
3The names of these 12 SSFUs are Causeway Bay, Chai Wan, Kwai Chung West, Kwun Tong, Lai Chi Kok, Sau Mau Ping, Sham Shui Po, Sheung Shui, Tai Po North, Yau Tsim, Tuen Mun and Wong Tai Sin. These 12 SSFUs have been reprovisioned during the 1998-99 financial year. The fitting out works have taken into account the space requirements under the CSSS. Therefore, only minor works are now required for computer trunking etc.
4Since the previous PWSC submission of 66IS on 24 February 1999, the Administration has decided to locate the CCD in the former Kai Tak passenger terminal building in Kowloon City instead of Tuen Mun in order to reduce the cost of the project.
5Since the establishment of the EMSTF on 1 August 1996 under Trading Fund 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 services rendered for this project cover the overall project management, design, supervision, payment certificate, testing, commissioning and maintenance on the building services and electrical/ mechanical parts. The figures given above are based on estimates prepared by the D Arch S. The actual cost for the service charges is subject to further discussion between the government and the EMSD.
6As mentioned in footnote 4, the CCD will now be located in the former Kai Tak passenger terminal building. The area available is larger but the building services requirement is smaller which leads to a lower unit cost for the fitting out works.
