Nearly lost in all this week’s excitement was a proposal to scrap the planned Kowloon-
Guangzhou high-speed rail link and convert the station into a mall. The idea comes from uppity know-it-all think-tank Professional Commons; they have actually costed it and determined that using the giant space for retail and other activities would bring a significantly higher return. Needless to say, such economically literate common sense would entail a massive loss of face for the bureaucrats who so desperately pushed the white-elephant project a few years back.
Still, we have not heard the last about the Express Rail Link, to give it its proper name. It was originally supposed to cost HK$65 billion, then went to HK$71 billion, and will now cost HK$85 billion. The big debate is whether the government or MTR should pay the overrun – as if either way it doesn’t ultimately come out of our pockets.
A Standard columnist asks how such an overrun can happen, and mentions that another project – Liangtang border crossing – is also massively over-budget. “Are there systemic reasons why the government keeps underestimating…?” We could also mention the Bridge to Nowhere/Zhuhai.
It looks like a scam. But I think it’s actually a double-scam.
The first scam is obvious. The Hong Kong people toil and create wealth, much of which is then sequestered via land premiums and other hidden taxes and stuffed into a Capital Works Stash. Bureaucrats and construction interests devise and build pointless huge projects to recycle your hard-earned money into their own pockets.
But they also gear this scam up. Obviously there is limited capacity in terms of equipment, materials and labour (especially as much of this industry is cartelized and controlled by the same tycoons who corner the rest of the domestic economy). So simultaneous big projects inevitably push each other’s costs up. This is accompanied by much hand-wringing and moaning and lamentation, as if the cost overruns are some sort of unforeseen natural disaster or act of God. The usual scumbags can come back and rip us off a second time.
Note the feedback loop here: the cost-overruns are an effect of other cost-overruns, and they cause yet more cost-overruns, and so on.
This is also happening with residential property prices. With prices rising, developers bid more for land. The Lands Department happily sells it for more. Land that used to cost HK$1,000 a buildable square foot now – regrettably – costs HK$2,000, HK$3,000 or HK$4,000 a buildable square foot. Higher costs cause higher prices? Or higher prices ‘causing’ higher costs?
Adaptive re-use – or maybe we should just call it adaptive pre- or neo-use – of white 
elephants could solve a lot of problems. The vast palatial hole under West Kowloon could rehouse a load of crappy above-ground malls, which could then be turned into things people need but can’t have because We Have a Shortage of Land. (Proper food courts!) A glance at the map on my wall suggests that Disneyland is comparable in size to a big chunk of Shatin and, if repurposed into a car-free high-density Discovery Bay, could house 250,000 people with no problem (Shatin has 600,000). The wretched HK$7 billion cruise terminal at Kai Tak is a cavernous and empty structure that could hold every elderly care home, kindergarten, artist’s studio and columbarium niche we could ever need. The Zhuhai Bridge… a skateboard course?
I declare the weekend open with the peculiar thought that this is the second time this week I have declared the weekend open.
This just in: Stuart Wolfendale. For the old folks, a bit of nostalgia. Hard to believe today, but the South China Morning Post used to have this – a humour column. Really.
To go with the theme, today I find out that back in the 1980s, some British civil servants briefly entertained the idea of adaptively reusing Northern Island to resettle Hong Kong’s 5.5 million residents. http://www.hongkongfp.com/2015/07/03/british-plan-to-move-5-5m-hong-kongers-to-n-ireland-revealed-in-declassified-docs/
To think that in some unlikely alternate universe, I might’ve been Irish. It’s bizarre.
Argh, I meant Ireland, not Island. Typo gremlins in my head.
I propose that we rebuild Nathan Road on the Bridge to Nowhere and move all the gold, iPad and overpriced handbag shops there. With a giant parking lot on either end. Border control shenanigans mean that the bridge’s full capacity will never be used anyway, so we might as well put the retail monoculture there so that the Shopper Hordes on Wheels don’t have to drive all the way down to Mong Kok and Causeway Bay and clog it up for the rest of us.
For my money, the best food court is in the Dragon Center. And you are right, there aren’t enough of them.
I recently had a weed-induced flashback where I was reading newspaper columns from Nury, Vines and Woolfie. Straight back to 1990. And then HKFP came online. Coming up: .Ted Thomas
So here we are, thirty years later—[sigh]—and Nury’s *still* re-telling my old story about the American tourist who once stopped me on patrol in TST and asked me: “Lootenant, where can I find Chinatown?”
However he seems to have forgotten about my riposte, when I pointed out to her that I was in fact an inspector, and that a “lootenant” is a person who rents living space in a toilet.
Too bad, Nury, you could have made an extra couple of dollars for that.
This whole project overrun thing should be investigated by the ICAC.
When MTR tender for some new trains or KMB some new buses both the tender and the contract terms are quite clear that the price is fixed (unless otherwise negotiated) and furthermore if delivery goes past the contractual date then late delivery penalties will start to accumulate. This is a simple economic encouragement to ensure that the tenderer neither tells untruths during the tender process nor unduly reneges on those delivery promises upon contract execution.
If these tenders (bridges, railways, airport runways) are written differently than other regular government backed tenders IMHO questions should be asked in the house (pan dems, anyone)?
Probably,
Michael Tien, who was formerly the Chairman of the KCRC so probably has an inkling of the way these thing work, was interviewed on RTHK this evening. He stated that the recent enquiry into the cost overruns on the High Speed Rail link had revealed that the MTR’s original estimate for the project was HKD80 billion. This was not acceptable to the Govt and was “negotiated down” to HKD68 billion. Given that the Govt is the major shareholder, appoints the Chairman and has members on the Board of Directors one can imagine how the “negotiations” went. He also said that the Govt gave the MTR an assurance that they would cover any overruns. I have heard from other sources that the MTR were none too keen to do it anyway but were pushed into it by the Govt. That original estimate looks a lot more reasonable now and it is hard to blame the MTR management for “overruns” which appear to be what they originally forecast. [Not that I’m in the habit of making excuses for the MTR!]
The whole thing is being done for political reasons anyway and the financial aspect was probably considered irrelavent except insofar as they had to come up with a sum which didn’t seem too preposterous to the Legco Finance Committee. It seems someone decided that HKD68 billion sounded better than 80 – to an extent they were right as the FC did approve the funding.
What interests me is the way that the Govt, through Anthony Cheung the Sec for Transport and Housing, is claiming ignorance of the problems which led to the “overruns”. Anthony Cheng sits on the Board, as does Caejer Chan, Sec for Financial Services, as does the Permanent Sec for Development and the C for T . Is Anthony alleging that the Management hid all this from the Board or were they all asleep during the meetings? It is worthy of note that Legco Member Abraham Shek is keeping pretty quiet on this: he is on the Board, too.
Not much point sending it to the ICAC.
@ Laguna
Ha ha, good one. Trust Nury to miss the funniest bit.
@ Hemmers
Good to see another mention of “The wretched HK$7 billion cruise terminal at Kai Tak” among the post-handover concrete pouring scams to enrichen tycoons. What fucking government retard cleared that when they had a perfectly workable solution at the existing immigration-cum-Prada shithole in TST.
@ Wolfendale
Ye live! Good to see that article; Oiii larrfed.
Re SW’s amusing article in HKFP. Why do I need a Facebook account to make a comment on it? The blurb beside the article says that SW wrote a long, weekly column on running for SCMP; I say if some enterprising editor can bring back the hyphen we shall be spared much ambiguity.
@Probably
ICAC does not investigate anymore. They harass (ala Jimmy Lai), but investigation requires brain work, and that organ atrophied long ago. If you want the ICAC to do anything, then like the eldest Kwok you must hire your own investigators to pull the package together. Next spend more money carefully, to make it very difficult for the CE to quash going forward for a
bribepre-benefit /delayed benefit from the other parties. Above all, don’t overlook how much it would cost to insure the judge, jury and Justice Dept are not interfered with (the two Kwok brothers almost broke clear — it was apparent a female juror was getting some massaging of her financial situation, and no one bothered to attempt to replace her).Any go at the Fast Rail is sure to fail. For a nearly $100 B project, there are a lot of well connected fat cats who have already got the fix in on this town. Even if you had video of a clear cut bribe, the chance of success is zero. Also every failure is just another act to embolden the already shameless.
@Probably – look at who’s sitting on the (no longer I)CAC these days. No Beijing bootlicker is going to approve any action that could disrupt a project of perceived national prestige, however corrupt and/or useless it may be.
Lord have mercy, Lord is great!
Train come early, train come late.
Dig the hole and dig it fine,
Dig that glorious railway line
All the way to Jordan!
Lord have mercy, raise your fist!
Deadline come and deadline missed.
Bore the tunnel, bore it slow,
But, Lord, how fast the trains will go
All the way to Jordan!
Lord have mercy, sing again!
Put me on that high-speed train.
Buy the ticket, any price,
Carry me to Paradise,
All the way to Jordan!
Latest PR release from the the non-journalist cum parasites at RTHK with a few editorial improvements.
MTRC names Frederick Ma as its next chairman (Tuesday, July 07, 2015, 6:50 pm)
The MTR Corporation announced on Tuesday that former Secretary for Commerce and Economic Development, Frederick Ma will replace Raymond Ch’ien as its chairman next year. Mr Ma is currently an independent non-executive director of MTRC. Mr Ma will receive an annual
salarykickback of HK$1.2 million for his three-year term starting January 1st next year. That’s the same level as the current chairman, Mr Ch’ien’sremunerationlegal bribeAlways forgetting to stick the best part on the end:
“Raymond Chi’en Kuo Fung [錢果豐; “Ch’ien” is the surname, and appropriately enough means “money”!], a director of British bank HSBC’s operation in the territory [and with many other positions besides, including director at UGL, the company who it was recently discovered secretly paid CY Leung (ed: supposedly)to support its purchase of DTZ!”
Anyone able to suggest what bribe did Fredrick Ma kick up to CY for his turn at the salt monopoly…. salt monopoly or did he buy the job on credit?
John could have made his show about almost every major project in HK over the last 30 years. It’s all been if we don’t build it, then they will leave.
https://youtu.be/xcwJt4bcnXs
Looking at immigration rates toAustralia, Canada and even Taiwan, I think the answer is they already have.