ArchSD Sustainability Report 2007

In the past years, we have completed and delivered top quality public buildings and facilities to our clients in a timely manner, with good economic value and within budget. Our Quantity Surveying Branch (QSB), along with our other five branches, assures the quality of our services in maintaining our leading role in the local construction industry.

QSB is primarily responsible for managing and controlling the costs of a construction project, and interfaces with the project teams in areas such as cost estimation, tender documentation and evaluation, post-contract administration, interim payment valuations, cost control and finalisation of accounts. It provides quantity surveying services for public building works including procuring new buildings, renovation or refurbishment of existing buildings, and all the subsequent maintenance.

Apart from these traditional quantity surveying services, QSB also provides professional advice to policy bureaux, government departments, quasi-government bodies and sub-vented organisations. Its professional services in cost management and control for public building works in this regards have resulted in a better use of public funds.

The following sub-sections provide more information on our cost management initiatives at various stages of our public works projects.

Project estimates are essentially based on cost information from previous project experiences and professional estimating techniques. With the knowledge and experience gained from building a large variety of government facilities, QSB takes the role for providing and collating all this information in a comprehensive cost database for the Department. Moreover, the database includes standard phraseology for bills of quantities, standard method of measurement, and a library of standard contract documents. This all-encompassing database of cost information and standard documents secures the provision of our cost advisory service at the highest possible standard.

To further enhance the delivery of our services, research studies on exploring the potential implication of life cycle cost³ (LCC) will be conducted, and a database of the LCC information of our public facility projects is proposed. The studies and database will make references to the international standards. The LCC techniques may then be applied to the evaluation of alternative design / investment options in our future projects.

As the public works agent for procuring and maintaining all the government buildings, we follow strictly the Government's procurement policy including public accountability, value for money, transparency, open and fair competition and equal opportunities to be opened to all eligible domestic and foreign suppliers and services providers.

In addition to the common contract strategy (e.g. lump sum contract) adopted by the construction industry, we also employ other procurement approaches (e.g. design and build contract) for our capital and maintenance works. Various contract strategies bring us a more flexible and effective design on our public works contract. We also investigate the feasibility of other sub-contracting initiatives such as introducing Principal Building Services Subcontractor in a building contract to further enhance the overall efficiency of project management.

Upon the project commencement, QSB and other project team members ensure that the project is delivered in accordance with the contract terms and conditions, and within the estimated cost limit. A good cost control and monitoring system facilitates our clients to obtain a clear insight of their expenditures and prevent any overrun of the budget.

QSB’s current practice is the regular issuance of a project financial statement including cost implications of the issued and proposed variations, adjustment of provisional quantities and provisional sums to date etc.. Recently, we have adopted a web based Contract Variation Management System to closely monitor the issuance of variations by electronic means. This system enables a real-time access of project financial information by the project team.

For overall contract administration, we have also, since early 1990’s, implemented the Dispute Resolution Advisors System (DRAd) for our projects. The DRAd studies the project and relevant contract documents and identifies potential problems, so that all parties are well advised and the occurrence of these identified issues can be prevented as far as possible.

The DRAd continues to trace possible problematic areas and claims throughout the project period, so that preventive and corrective actions can be engaged in advance. If a dispute arises, the DRAd provides opportunities for the clients and contractors to state and discuss their views on the case in a private and professional manner. Instead of bearing the risks of long delays and substantial costs in arbitration and litigation, both parties are more than willing to settle any discrepancies.

The DRAd has been proved to avoid claims effectively at an early stage and resolves disputes before they escalate. It also deters the contractor from filing unjustifiable claims and promotes a closer public-private partnership.

The quality of our projects is also pledged by a variety of professional and independent audits conducted throughout the project period. The focus area of these audits includes technical, quality, environmental management, site safety, sub-contractor management, risk management, etc.. Our procedures and works are also subject to other audits or checking by the Commissioner of Audit and ICAC. These audit and checking activities serve to maintain and enhance the quality standard of our services.

³Life cycle cost includes not only the initial investment, but also the future costs of operation, maintenance and ultimate disposal.