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Second level check on extra West Rail payments

NEWS

tive, his responsibilities include developing the group's global mining business, as well as Cementation Skanska and its oil and gas business.

Clarke's promotion follows the successful integration of Skanska's UK operation into the group following its acquisition from Kvaerner 18 months ago.

HONG KONG'S Kowloon-Canton Railway Corporation (KCRC) has appointed an independent team to oversee the external probe into extra payments worth HK$1.53bn (£139M) to contractors on the £4.2bn West Rail project.

The probe is being carried out by KPMG, but local lawmakers claim the firm has a conflict of interest as it is also external auditor for Siemens, Amec and Kier, all contractors on the project. Hong Kong government chief executive Tung Chee-Hwa was urged to appoint the director of audit, Dominic Chan, to probe KPMG's assignment.

KCRC's confirmation that Siemens received £9M extra to cover for additional work on its its £26M telecommunications contract sparked public concern about cost overruns.

KCRC later said it paid a total of £139M in 27 supplementary agreements to contractors working on 18 West Rail contracts.

The cash covered claims for extra work, time extensions and acceleration payments that KCRC settled as part of its partnership approach to contractors. The payments are believed to cover all the civil works contracts and a handful of systems contracts.

KCRC chairman Michael Tien heads the inspection group which includes University of Hong Kong geotechnical engineering professor Lee Chack-Fan, former chairman of the Royal Institution of Chartered Surveyors in Hong Kong, Denis Levett and former Legislative Council president John Swaine.

The local construction industry is bemused by the wrangle. Sources warned the row could derail partnering efforts by KCRC and subway company Mass Transit Railway Corporation.

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