Airport Authority (AA) chief executive Fred Lam Tin-fuk has assured that his agency will bear all the extra expenditure that may arise from any construction delay in the planned third runway at the airport, Apple Daily reported.
Lam’s promise to Legco’s Panel on Economic Development Monday came after some lawmakers expressed concern that taxpayers could end up footing the bill for potential delays in the runway project, as was the case in the Guangzhou-Shenzhen-Hong Kong high-speed rail venture.
While admitting that some unpredictable factors may emerge during the course of construction, Lam, who assumed his post in October, said that the AA has conducted risk assessment and that it is confident that it will be able to complete the project even if the expenditure exceeds the budget.
As for lawmakers’ concern that the new runway will not be able to go into operation until at least 2030 even as the existing two runways are expected to reach capacity limits by 2017, Lam said the AA will discuss with the Civil Aviation Department contingency plans, including the possibility of adding more flights during late night hours.
According to the financial projections presented to the Legco panel by AA, the new runway requires financing of HK$141.5 billion (US$18.24 billion). Of the amount, about HK$53 billion, or 38 percent, will come from loans and debt financing, while another HK$47 billion, or 33 percent, will come from AA’s profits and the government’s forfeiture of annual dividends for ten years.
The remaining amount of about HK$42 billion will come from a levy on passengers, at HK$180 on each departing traveler.
Responding to comments by a lawmaker, Paul Tse, that the AA should re-estimate passenger growth given the possibility of a change in visitor numbers amid anti-mainland visitor sentiment in Hong Kong, Lam said the third runway is aimed at worldwide passengers, and not just mainlanders.
Mainland visitors are projected to account for only 20 percent of the expected total traffic.
Meanwhile, lawmaker James Tien questioned whether AA’s financing plan may go against the Basic Law given the decision not to pay dividends to the government and to bypass Legco supervision.
Anthony Cheung, Secretary for Transport and Housing, said the AA has certain rights under the Airport Authority Ordinance, which also says it can seek financing by itself for development purpose.
Following a proposal by lawmaker Dennis Kwok, the panel finally decided to form a task force that will keep studying various issues connected with the third runway.
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