Legislative Council Papers

Annex C

THE GOVERNMENT'S POINT-BY-POINT RESPONSE

Recent Judgment of the High Court

Recent Judgment of the High Court
Query by SPH/ Government's response	Content
Query No. 1 by SPH	SPH quotes Mr Justice Hartmann's remark in the judgment that "it may well be preferable for the CE in C to remit the plan" and argues that this shows that the Court also agrees that CE in C should refer the Central plan to the Town Planning Board.
Government's response	The statement in the judgment was quoted by SPH out of context. According to Mr Justice Hartmann, whether or not to remit a plan regarding the extent of reclamation is in essence a question which goes to the merits and he has ruled that it is not for the court to look at the merits of reclamation. Instead, the crux of the matter in SPH's application for JR in relation to the approved OZP is the powers and responsibilities of CE in C exercised pursuant to the TPO and the Court has ruled that the power to revoke an approved plan or to seek its amendment rests entirely with CE in C. In determining not to revoke or refer the approved Central OZP to the TPB for reconsideration, the CE in C was exercising his discretion under section 12 of the TPO and was acting lawfully and reasonably. CE in C, in determining whether the CRIII reclamation accorded with the three tests stated in Madam Judge Chu's judgment, was doing no more than exercising his discretion in terms of section 12 of the TPO to determine whether the approved OZP did or did not require revocation or amendment. In so doing, the CE in C was not acting ultra vires.
Query No. 2 by SPH	SPH alleges that the judgment did not give legitimacy to the Central Reclamation plan.
Government's response	At issue was whether the approved Central OZP was declared a nullity or invalid, not whether the approved Central OZP was lawful. Mr Justice Hartmann remarked that he could read nothing in the Town Planning Ordinance to the effect that an error of law alone would vitiate a plan prepared and approved under the Ordinance. In other words, the Judge accepted that it was a matter for CE in C to determine whether the error of law would affect the integrity of the Plan to the extent that it could no longer be valid. Unless and until put aside by a court order, the Central District (Extension) Outline Zoning Plan (OZP) remains lawful and valid.

Judgment of the Court of Final Appeal

Judgment of the Court of Final Appeal
Query by SPH/ Government's response	Content
Query 3 by SPH	SPH queries why the Government refuses to refer the Central Plan back to the Town Planning Board while on the other hand, the Court of Final Appeal judgment has ordered to do so for the Wan Chai Plan.
Government's response	We must point out that the Central Plan is an approved plan whereas the Wan Chai Plan is a draft plan. The Central Plan was approved by the CE in C in February 2000 and remains valid and lawful unless and until it is set aside by the court. Mr Justice Hartmann rules that the decision whether or not to refer an approved plan to the Town Planning Board rests entirely with the CE in C. In coming to its decision not to refer the plan to the Board, Mr Justice Hartmann found that CE in C has acted lawfully and reasonably. Moreover, the Judge notes that in the case of CRIII, time has passed. He adds that in planning matters time is invariably of importance and indeed good administration, far from surrendering to delay, should seek to avoid it. If the Central Plan is to be referred to TPB for reconsideration, we estimate that from start to finish, it might take 39 to 59 months (including the 14 months for the plan-making process as mentioned above) to complete all the necessary statutory and administrative procedures before works could re-commence. The social, economic, cost and delay implications are significant.
Query 4 by SPH	SPH queries why the Government is proceeding with the Central Reclamation, the Wan Chai Reclamation and the Kowloon Bay Reclamation.
Government's response	We cannot understand why SPH has continued to overlook the Government's repeatedly stated public position. Other than the remaining phases of the Central and Wan Chai reclamation and South East Kowloon, there will be no more reclamation within the Harbour. These are not new schemes per se. The Central and Wan Chai reclamations are the final phases of the entire Central and Wan Chai reclamation started since early 1990s which we need to complete for the essential transport infrastructure while South East Kowloon is related to the relocation of the airport. We are only proceeding with the CRIII at the moment. The Wan Chai Development Phase II and South East Kowloon Development are subject to review to ensure full compliance with the Protection of the Harbour Ordinance.

Relief of Traffic Congestion

Relief of Traffic Congestion
Query by SPH/ Government's response	Content
Query 5 by SPH	SPH queries why the Government is reclaiming 5.1 hectares of land for sale to developers for commercial development with 6 million square feet of floor area.
Government's response	We query how the figure of 6 million square feet of floor area is derived as this is plainly incorrect. More importantly, SPH has tried to mix up the reclamation issue with the land use planning issue. The extent of reclamation under CRIII is determined by the requirement of the essential transport infrastructure, not as a result of the proposed land use. In other words, even if there were no commercial use at all, the amount of reclamation would remain the same at 18 ha. The fact is since the Central-Wan Chai Bypass will mainly be built underground, the resultant reclaimed land provides formed land for good urban planning including predominantly a waterfront of international standard for the enjoyment of citizens and tourists alike. We have never hidden the zoning of 5.1 hectares for commercial use in the approved OZP. The 5.1 hectares of land comprises two components - - About half (2.5 hectares) is zoned for low-rise waterfront related commercial and leisure uses such as festival markets, cafes, restaurants and retail shops. They are meant to complement the function of the waterfront promenade and will add variety and attraction to the waterfront, and are subject to stringent height restrictions of 13 meters above principal datum (mPD) to 25 mPD (ranges from 1 to 4 storeys). The amount of gross floor area falling within CRIII is in the order of 57,000 square meters. - The other half (2.6 hectares) is part of the Comprehensive Development Area (CDA) site. The CDA will be a podium structure with low-rise pedestrian landscape deck on the east and the groundscraper on the west. The maximum height for the landscape deck is 16mPD (about 2 storeys) and that for the groundscraper is 50 mPD (about 10 storeys). The maximum gross floor area is about 190,000 square meters. Assuming half of the gross floor area will fall on reclaimed land, the gross floor area is in the order of 95,000 square meters. The total maximum gross floor area for commercial use is therefore 152,000 square meters, which is only one-quarter of the figure used by SPH (6 million square feet is equivalent to about 600,000 square meters). It should be noted that 9 hectares of the formed land under CRIII (i.e. 50%) are zoned for open space (almost half the size of the Victoria Park).

Minimum Reclamation

Minimum Reclamation
Query by SPH/ Government's response	Content
Query 6 by SPH	SPH claims that the Government is wrong to reclaim an extra 1 million square feet which is not needed for the Central Wanchai Bypass.
Government's response	We do not know how the SPH derives the "1 million square feet". We are confident that the reclamation required under CRIII is already the minimum that is required to build the Central - Wan Chai Bypass and to house the pumping stations, ferry piers, etc. This has been confirmed by an engineering review and has the support of independent experts.
Query 7 by SPH	SPH claims that the Marine Basin covering 3 hectares near the New Convention Centre is not needed.
Government's response	The proposed reclamation related to the marine basin is outside of CRIII. Its need or extent of reclamation will be considered in the review of the Wan Chai reclamation. In its ruling, Mr Justice Hartmann noted that for engineering reasons, the work of reclaiming that portion will be carried out when, and if, any reclamation work is authorized, pursuant to an approved plan for Wan Chai. The CRIII under the current works contract in force involves a reclamation of 18 hectares. Any changes to the Marine Basin resulting from the review of the Wan Chai reclamation will not affect the extent of the CRIII reclamation. As and when such changes to the proposed Marine Basin reclamation have to be reflected in the Central OZP, the plan will be referred back to the TPB.

Central Reclamation Works Contract

Central Reclamation Works Contract
Query by SPH/ Government's response	Content
Query 8 by SPH	SPH queries why did the Government prematurely enter into the Central Reclamation Works Contract when it was fully aware that the Wan Chai Judicial Review would affect the Central Reclamation.
Government's response	We do not agree that we have "prematurely" entered into the CRIII works contract. The CRIII works follows a due programme of its own. The Central OZP was approved in February 2000, funding for the detailed design and tender preparation of CRIII was approved by LegCo in April 2000, CRIII's reclamation and roadworks were authorized in December 2001, funding for construction of CRIII was approved by LegCo in June 2002, tenders were invited in August 2002 and contract was awarded on 10 February 2003. The SPH commenced legal proceedings on 27 February 2003 to apply for judicial review of the decisions of the TPB made in connection with the draft Wan Chai North OZP. In any event, the Wan Chai case has nothing to do with the Central Plan.
Query 9 by SPH	SPH queries why has the Government not respected and complied with the Decision in the legal proceedings arising from the Central Reclamation Works Contract when the Decision recommended that the Government should re-tender the Works Contract.
Government's response	We emphasize that the bid challenge has nothing to do with the legitimacy of the CRIII works contract. However, to put the record straight, we wish to point out that the CRIII Works Contract was awarded on 10 Feb 2003 while the Decision of the Bid Challenge was handed down on 14 July 2003. With a binding contract, between Government and the successful tenderer, a re-tender exercise would not be practical. Moreover, the WTO GPA does not impose a duty on the procuring entity to adopt the recommendation of the Panel.
Query 10 by SPH	SPH queries why did the Government not take legal advice and include an 'escape clause' in the Works Contract so as to avoid substantial claims being made by the Contractor.
Government's response	As a general rule, there are clauses on frustration of contract arising from special risks such as war. Nevertheless, in this case, we have sought legal advice that the litigation is not a good reason for voluntary frustration of contract by the Government. Conditions of Contract have to be fair and reasonable to the parties concerned. Inclusion of unreasonable clauses would have the effect of unnecessarily inflating the cost of the contract. In any event, there was no challenge on the CRIII at all until the award of the contract. It is therefore not unreasonable for the procuring entity to have proceeded in the way it did.
Query 11 by SPH	SPH queries what is the urgency in the Central Reclamation Works to build half a Bypass when the Town Planning Board has announced that it will take up to 2 years to review the Wan Chai Reclamation Plan.
Government's response	We need to form the land required for the Central-Wan Chai Bypass under the CRIII contract as soon as possible. Otherwise, the CWB cannot be built in time to solve the congestion problem along the CRC/HR/GR Corridor, which will in turn cause congestion in the neighboring roads in Central and Wan Chai creating gridlock. Another urgency to take forward the CRIII works is to build the Road P2 networks which are required to be completed by 2006/2007 to connect the existing roads in the CRI to CRII area in order to avoid gridlock at the already congested roads and junctions in Central such as Man Po Street, Man Yiu Street and Man Cheung Street/Man Yiu Street junction. Due to the lack of the Airport Railway Extended Overrun Tunnel (AREOT), the Airport Railway and Tung Chung Line have not been able to operate at their design capacity and shorter trains have to be used at present. MTRCL has indicated the need for the extended tunnel by 2006.

Electronic Road Pricing

Electronic Road Pricing
Query by SPH/ Government's response	Content
Query 12 by SPH	SPH queries that the Government has only released an executive summary of the ERP consultancy study and thus failed to give a full picture of the pros and cons of implementing ERP in Hong Kong.
Government's response	We have released the full Final Report on Feasibility Study of ERP in April 2001. The full Final Report sets out the process, major findings and key recommendations of the Study. The road pricing concept, technological options, alternative traffic management measures, need for ERP, possible system for Hong Kong, integration with other intelligent Transport systems, benefits and public consultations were examined in detail during the Study.

The Atkins Consultancy on Minimum Reclamation Options

The Atkins Consultancy on Minimum Reclamation Options
Query by SPH/ Government's response	Content
Query 13 by SPH	SPH criticizes the Government for refusing to release the $30 million consultancy study done by Atkins which they allege have produced options involving a smaller extent of reclamation.
Government's response	The $32.6 million Atkins consultancy for CRIII awarded in July 2000 (with funding approved by PWSC in April 2000) covers the detailed design, tender, construction and completion phases for the CRIII Minimum Option. The detailed design for the Minimum Option of 18 ha based on the approved Central District (Extension) OZP has remained unchanged during the detailed design stage. This consultancy assignment comprised the preparation of detailed designs and tender document and the deliverables were in the form of Form of Tender, Schedules, Bills of Quantities and Drawings, etc. There is no study report per se for release to the public. On 8 April 2004, we have explained details of the Atkins consultancy to the LegCo Panels and deposited the contract drawings prepared by Atkins in the LegCo Secretariat for Members' reference.

Moratorium on reclamation

Moratorium on reclamation
Query by SPH/ Government's response	Content
Query 14 by SPH	SPH calls on the Government to declare an immediate moratorium of all reclamation works so that the community can have the opportunity to consider whether there is any overriding public need for further reclamation of the harbour.
Government's response	There have been by now two decisions of the High Court in favour of the Government in relation to the CRIII works. Taking into account the decisions of the Court, the urgency of the works involved, the public interest, and the third party rights created, the Government can see no valid reason to further delay the works. As a matter of good administration, the CRIII project must now proceed without further delay. In fact, there is no room for further "suspension" of certain works within the CRIII contract. If we did not resume works timely to meet the tight contract programme, we might have to terminate the contract altogether and face huge claims from the contractor. Before a reclamation proposal is authorized in accordance with the relevant statutory procedures, there is no question of the Government entering into any contract for the works concerned. Therefore there should not be any concern that any reclamation works related to any draft OZP would be implemented before any statutory procedures had been duly completed. As such, a moratorium is not required.