For discussion FCR(96-97)31 on 28 June 1996

ITEM FOR FINANCE COMMITTEE

CAPITAL WORKS RESERVE FUND
HEAD 708 - CAPITAL SUBVENTIONS AND MAJOR SYSTEMS AND EQUIPMENT
Medical Subventions
New Subhead "Kowloon Medical Rehabilitation Centre"

Members are invited to approve a commitment of $894.78 million in money-of-the-day prices for construction of the Kowloon Medical Rehabilitation Centre.

---

PROBLEM
PROPOSAL

Project scope and nature

JUSTIFICATION
FINANCIAL IMPLICATIONS
ENVIRONMENTAL IMPLICATIONS

Public consultation

BACKGROUND INFORMATION
Breakdown of estimates for consultant's fees

---

PROBLEM

There is an overall shortage of infirmary beds and rehabilitation facilities in Hong Kong.

PROPOSAL

2. The Secretary for Health and Welfare proposes to reduce this overall shortage by providing a medical rehabilitation centre in Kowloon City at a non-recurrent cost of $894.78 million in money-of-the-day (MOD) prices.

Project scope and nature

3. The project will involve construction of a new complex comprising one seven-storey and one six-storey blocks. A site plan is at Enclosure 1.

4. The two inter-linked blocks with a total gross floor area of 37 000 m² will provide the following facilities -

1. 544 infirmary beds;
2. a geriatric day rehabilitation centre with 40 places;
3. rehabilitation facilities covering physiotherapy, occupational therapy and prosthetic/orthotic services; and
4. an out-patient department, a radiology department and a pharmacy.

JUSTIFICATION

5. Our population projections indicate that the number of elderly people aged 65 and over will grow at an average rate of 3.5% per annum, from 515 400 in 1992 to 701 100 in 2001. Among the elderly, the growth rate of those aged 70 and above will be even higher. The growth in the elderly population has given rise to an increasing demand for infirmary beds. Despite the expansion and improvement projects commissioned in recent years, there is still a waiting list of 4 672 for such facilities at 1 May 1996. The Hospital Authority (HA) is now providing 1 772 infirmary beds and has plans to open another 572 beds by 1999. The proposed centre with 544 infirmary beds will help to reduce the current shortage of such facilities and enable more elderly patients to receive proper institutional care.

6. Medical rehabilitation is an integral part of curative treatment and is instrumental in relieving the heavy demand for infirmary beds. The rehabilitation facilities in the new centre will enhance the quality of life for patients, facilitate their early discharge from hospitals and reduce their re-admission rate. For those chronically-ill patients who do not require hospitalisation, the rehabilitation service in the geriatric day rehabilitation centre could provide them with suitable treatment. The new centre with infirmary beds and rehabilitation facilities integrated under one roof will help to achieve greater operational efficiency and economy of scale.

FINANCIAL IMPLICATIONS

7. The Director of Architectural Services (D Arch S) estimates the total project cost to be $894.78 million in MOD prices, made up as follows -

A breakdown of estimates for consultant's fee is at Enclosure 2.

8. The estimated cashflow is as follows -

9. D Arch S derives the MOD estimate on the basis of the Government's forecast of trend labour and construction prices over the period 1996 to 2001. D Arch S will tender the project under two separate fixed price lump-sum contracts for piling and superstructure respectively.

10. HA estimates that the additional annually expenditure of the project will be $174 million at 1996 price level, made up as follows -

11. Subject to Members' approval, D Arch S plans to start work in October 1996 for completion in May 1999.

ENVIRONMENTAL IMPLICATIONS

12. In November 1994, D Arch S completed a Preliminary Environmental Review (PER) of this project and concluded that, given the nature, size and location of this project, the operation of the project would have limited potential for adverse impacts on the environment. The Director of Environmental
Protection vetted the PER and agreed that an Environmental Impact Assessment would not be necessary. There will be no on-site incineration of wastes and HA will implement the arrangements for management, storage, transport and disposal of liquid, chemical and clinical wastes as recommended in the PER. HA will follow the guidelines issued by the Department of Health on the disposal of radioactive wastes and will also equip the new buildings with central air-conditioning to enhance the internal noise environment of the new buildings.

13. For short term impact during construction, D Arch S will control noise, dust and site run-off to within established standards and guidelines through the implementation of appropriate mitigation measures in relevant contracts.

Public consultation

14. The Kowloon City District Board supports the project.

BACKGROUND INFORMATION

15. The waiting list for infirmary beds stood at 4 672 on 1 May 1996. There are 1 772 infirmary beds in the public sector and planned projects to be commissioned, including the project under request, will provide 1 316 additional beds. Six nursing homes will also provide another 1 400 places by 1997/98. Members have already approved these homes financed by Lotteries Fund. Nursing homes serve the need of those elderly who, because of their health condition, cannot be adequately cared for in care-and-attention homes but do not require the more intensive medical and nursing care provided in the infirmaries. The provision of nursing home places will help further reduce the infirmary shortfall.

Health and Welfare Branch

June 1996

---

Enclosure 1 to FCR(96-97)31

the map (please refer to hard copy)

---

Enclosure 2 to FCR(96-97)31

New Subhead - Kowloon Medical Rehabilitation Centre
Details of Consultant's Fees

Breakdown of estimates for consultant's fees

Notes -

1. A multiplier factor of 3 is applied to the average Master Pay Scale (MPS) point to arrive at the full staff costs including the consultant's overheads and profit, as the staff will be employed in the consultant's office. (As at 1 April 1995, MPS point 40 = $51,440 per month and MPS point 16 = $17,270 per month.)

2. 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 consultant through the usual competitive lump sum fee bid system.

3. The estimated consultant's fees represent 1% of the total project estimate, and cover service for quantity surveying discipline.

---