For discussion
FCR(97-98)109
on 27 March 1998

ITEM FOR FINANCE COMMITTEE

CAPITAL WORKS RESERVE FUND
HEAD 708 - CAPITAL SUBVENTIONS AND MAJOR SYSTEMS AND EQUIPMENT
Hong Kong Police Force
New Subhead "New Radio System for Crime Wing of the Hong Kong Police Force"

Members are invited to approve a new commitment of $198 million for replacing the radio system used by the Criminal Intelligence Bureau and the Narcotics Bureau of the Hong Kong Police Force.

PROBLEM

The existing radio system used by the Criminal Intelligence Bureau (CIB) and the Narcotics Bureau (NB) has become obsolete and requires enhancement to meet present-day operational needs.

PROPOSAL

2. The Commissioner of Police (CP) with the support of the Secretary for Security proposes to acquire a new radio system to replace the one currently used by CIB and NB.

JUSTIFICATION

3. At present, the CIB and NB share one radio system to support their operations. The existing system was introduced in 1980. Having been in use for 18 years, the system is aging with frequent breakdowns. Enhancement took place on a piecemeal basis in the past but it has reached the point where further enhancement of the existing system is no longer cost-effective, if not practically impossible. The Police have also encountered increasing difficulty in obtaining spare parts for maintenance due to obsolescence of the system. Furthermore, with the changes in the geographical distribution of the population and the rapid development of new infrastructure in Hong Kong, the existing system can no longer fully meet present-day operational requirements because -

1. it has limited coverage;

2. it has only limited radio channels which constrains operational efficiency and flexibility;

3. it has inadequate security protection against unauthorised access especially those with advanced technological aids. At present, to tackle the problem, Police officers have to take extra measures like using codes when communicating through the radio system; and

4. it is subject to increasing radio interference.

4. CP has examined the feasibility of expanding the radio systems currently in use by other formations to meet the needs of CIB and NB. However, most of the existing systems, such as the beat radio system and traffic control system, are for general operations with inadequate security protection against unauthorised access. In addition, the radio coverage of these systems is provided on a district or division basis. They are therefore not suitable for use in territory-wide operations.

5. Based on a thorough study of the operational requirements, CP proposes to acquire a new digital radio system to be jointly used by CIB and NB. The proposed system will have the following major benefits -

1. it can provide a wider radio coverage to include areas essential for Police operations;

2. it can provide sufficient channels to allow flexible and efficient deployment of resources. This is particularly essential when conducting large scale operations;

3. it has enhanced security protection against unauthorised access;

4. it can overcome the interference problem; and

5. it has capacity for expansion in future.

FINANCIAL IMPLICATIONS

Non-recurrent costs

6. Drawing reference from the radio systems purchased through public tenders and findings of market surveys, CP estimates the non-recurrent costs of acquiring the new radio system at $198 million, broken down as follows -

	$'000
(a) Command control and management sub-system	31,777
(b) Radio repeater sub-system	38,220
(c) Relay network sub-system	25,688
(d) Mobile radios with encryption	28,690
(e) Supporting services (including design, installation, training and documentation)	31,669
(f) Site development, building services and miscellaneous works	16,000
(g) Maintenance, test equipment and spares (for the first year)	11,194
(h) Contingency	14,659 ______
Total Say	197,897 198,000 ______

7. The cashflow is estimated as follows -

		$'000
1999-2000		40,000
2000-2001		138,000
2001-2002		20,000 ______
Total		198,000 ______

8. As regards paragraph 6(a), the estimate of $31,777,000 is for procurement of radio dispatch terminals, trunk central controller, console central electronic, console furniture, digital recorders, digital modem and telemetry system.

9. As regards paragraph 6(b), the estimate of $38,220,000 is for procurement of radio repeater equipment like digital repeaters, digital modem and antenna system to be installed at the repeater sites.

10. As regards paragraph 6(c), the estimate of $25,688,000 is for equipment including digital microwave link, multiplexer and the management system for linking up the repeater sites and the trunk central controller.

11. As regards paragraph 6(d), the estimate of $28,690,000 is for procurement of mobile radios with encryption and related accessories like batteries for the use of individual officers and to be installed in vehicles.

12. As regards paragraph 6(e), the estimate of $31,669,000 is for supporting services such as design, installation, training and documentation.

13. As regards paragraph 6(f), the estimate of $16,000,000 is for development of new repeater sites and expansion of the existing repeater sites to accommodate additional equipment, and the associated building services works.

14. As regards paragraph 6(g), the estimate of $11,194,000 is for provision of test equipment, maintenance service and spare parts for the first yearbe included in the warranty.

15. As regards paragraph 6(h), the estimate of $14,659,000 is for contingency on the cost items set out in paragraph 6(a) to (g).

Recurrent costs

16. The estimated additional annually recurrent expenditure arising from the proposed system will be $8,768,000, broken down as follows -

	$'000
(a) System maintenance and spare parts	4,731
(b) Lease line rental and radio licence fee	4,037 _____
Total	8,768

17. As regards paragraph 16(a), the estimated expenses are for on-going maintenance support of the new radio system.

18. As regards paragraph 16(b), the estimated expenses are for operating costs of the new radio system.

Implementation Plan

19. CP plans to implement the proposed radio system according to the following schedule -

(a) System design		March 1998 to July 1998
(b) Tendering and award of contract		August 1998 to July 1999
(c) Delivery of equipment, installation, acceptance tests and system commissioning		August 1999 to September 2000

BACKGROUND INFORMATION

20. The existing radio system of the Crime Wing is a conventional analogue system which has been in use since 1980. At present, it supports two crime investigation bureaux of the Police Force, namely the CIB and the NB, in their daily operations. Because of the work nature of the two bureaux, adequate security protection and coverage of the radio system used are essential to the effectiveness of their jobs. Due to obsolescence, the existing radio system can no longer fully meet the present-day operational requirements of the two bureaux. CP also considers it not cost-effective to maintain or enhance the system.

21. We briefed the Provisional Legislative Council Panel on Security about the proposal at its meeting on 19 February 1998 and the Panel supported it.

Security Bureau
March 1998