MASS RAPID TRANSIT SYSTEM (Feasibility studies)

Mr Ng Kah Ting asked the Minister for Communications and Acting Minister for Culture whether feasibility studies on all aspects of the proposed Mass Rapid Transit system have been completed and when a decision can be made; what is the total cost of the feasibility studies; how much it will cost to implement the system, and what will be the stages of implementation.

Mr Ong Teng Cheong: Sir, Phases I and II of the engineering and economic feasibility study of the proposed Mass Rapid Transit have been completed. The total cost of these two phases of study was $4.5 million.

The third phase of the Mass Transit Study, the primary task of which is to establish the preliminary engineering design criteria of the MRT and to obtain a more accurate cost estimate, is scheduled to be completed in June this year. It will cost about $3.9 million.

Right now, I am unable to say exactly when a decision can be taken to build the MRT. It is a complex and expensive project; it will probably run into $4 billion at current prices. Therefore, all aspects including revenue projections and development potential will have to be studied in detail to determine its viability.

However, I can assure the hon. Member that we will take a decision as soon as we are confident of the accuracy of our projections on construction costs, operating costs, and returns on higher property leases over new underground stations, and operating revenue. A Provisional Mass Rapid Transit Authority is now in the process of being set up to carry out further preliminary works related to MRT.

Once a firm decision is taken, we will proceed with the detailed engineering design, following which tenders will be called. Once construction begins, it is estimated that the system can be built within 12 years in 11 stages, with the first stage ready for operation within five years.

Mr Ho See Beng: Sir, it seems the public is concerned about the cost of building the MRT. Is it not true that the longer we procrastinate, the higher will be its cost?

Mr Ong Teng Cheong: It is true that the longer we delay, the more costly the system will be. But because of the nature of the system and the scale of investments involved, it is vital that we have to satisfy ourselves that the route is carefully determined and laid to ensure maximum returns from the system, and that the money is well spent.

Mr Ho See Beng: Sir, in so far as the MRT is concerned, it is meant to serve the people. Therefore, the Government should not always think of getting a dividend from any kind of project. So I still say that the policy of procrastination is wrong.

Mr Ong Teng Cheong: Mr Speaker, Sir, I am afraid I cannot agree with the hon. Member in his argument because public funds are involved. No doubt it will cost more if we delay our decision. But we have to make sure that public funds are not wasted in an unnecessary or foolish way. So we have to study it very carefully before we commit ourselves to such expenditure.

Mr Ng Kah Ting: Sir, Phases 1, 11 and Ill of the feasibility studies have entailed public expenditure to the tune of $8.4 million. Would the Hon. Minister for Communications assure this House that not much more will have to be spent with the setting up of the Mass Rapid Transit Authority - he is moving the Bill at a later stage - and that these feasibility studies on all aspects of the system, be it the detailed planning or engineering designs, will not incur extra expenditure before a decision can be made?

Mr Ong Teng Cheong: The expenditure incurred so far of $8.4 million by the end of the Phase Ill study is a small amount compared to the total investment that we are going to put in the project. Though I do share the anxieties of the Member, we hope that we need not have to spend too much money on the study before a decision can be made.

Mr Ng Kah Ting: Sir, there are MRTs in some other parts of the world. Did the Ministry look into those systems as well? If they did, maybe we could have saved a lot of money, bearing in mind that these studies have taken several years.

Mr Ong Teng Cheong: Mr Speaker, Sir, to be exact, the study was officially made about eight years ago on the MRT system. But this is not unusual, as most cities in the world take about the same length of time, or even longer, to decide on the MRT. Hong Kong took 10 years to decide. It is true that there are many cities in the world that have the MRT system operating, and we could learn from them. We are studying the various systems in these cities.

But being in the tropics, Singapore's climatic conditions are very different from those in the advanced countries in the temperate zone. So different types of problems are involved in the construction of the system that we have in mind. Therefore, we have to study very closely. In this respect we are following very closely the experience that Hong Kong has in their MRT system.

Mr Eugene Yap Giau Cheng (Mountbatten): Sir, if $8.4 million is a small percentage of the total investment, according to the Hon. Minister, then can I ask him whether there is any chance of the Government shelving the project; in other words, deciding not to go ahead with the project?

Mr Ong Teng Cheong: Sir, I do not work on chance. The chances of shelving the project are as good as any chance. But, as I have mentioned previously, it appears that it would be unavoidable that we will have to have a system of this nature. The question is one of timing and how careful and wisely we spend this public fund.

Mr Ho See Beng: Sir, in his opinion is this MRT a justified project, assuming that the Government can afford to build it?

Mr Ong Teng Cheong: Sir, it is not a question of whether or not we can afford it. The construction of an MRT, as I have mentioned earlier, even if we can afford and decided to proceed, it has to be carefully phased in with our economic and physical development. Assuming that our economic growth is not going to be as rapid as what we have experienced in the past and the international economic situation is not as rosy as it has been in the past or, worse still, if it is on the decline, then there is no reason why we should proceed with the MRT. It is a question of the travel demand, whether it justifies the provision of such a system.

Mr Ng Kah Ting: Sir, if it is a question of travel demand, then the success of the Hong Kong MRT system will be greater than that of Singapore because the volume of our commuters in the public transport system is far less than that in Hong Kong, in which case we should not go ahead with the MRT.

Mr Ong Teng Cheong: Sir, different countries have different expectations from the people. And with growing affluence today we are having different types of problems.

The travel demand is a function of economic activity and the acceptability of the level of mobility in the City depends very much on the expectations of the people. Hong Kong is perhaps a unique situation. It has a high density of housing, with very high economic activity going on. It is a bustling city. We may not reach the same density as that experienced in Hong Kong. Many cities in the world which have lesser intensity of economic activity than ours already have MRT systems. So when we talk of travel demand, it is a relative term.

Mr Ho See Beng: This MRT is a service to the public. Since it is a service to the public and the Government can afford it, does the Minister still grudge it?

Mr Ong Teng Cheong: No, Sir, I do not grudge it. I said that it is a huge project with a large scale of public funds involved. Therefore, we have to thoroughly satisfy ourselves that this money is well spent.

Mr Ho See Beng: If it is to serve the public, all of us will also benefit from it.

Mr Ong Teng Cheong: But we have to ensure that maximum economic advantage is achieved.