HONG KONG'S Kowloon Canton Railway Corporation (KCRC) has headed off an anticipated £372M in claims from contractors on its £4bn West Rail project through early settlement of contract disputes.
The announcement came after local politicians criticised KCRC for paying West Rail contractors £139M in 27 separate supplementary agreements (NCE 21 February).
KCRC said it decided to make the payments to help contractors catch up delays so the project could finish on time. It argued that its decision to sign one off agreements meant that disputes could be resolved quickly rather than 'accumulating and festering to the detriment of the project'.
'Where a contractor has a valid case for extension of time, the corporation may ask the contractor to utilise more resources to recover time lost and bring progress back to meet original milestone dates, ' it told a subcommittee of the Hong Kong Legislative Council's transport panel.
'This mechanism allows the corporation to buy back delays and hence preserve the programme for completion of West Rail by the end of 2003, ' it said.
Andy Bolton INFOPLUS www. kcrc. com