No Plans To Increase Runway Levy For Passengers

Transport officials say they have no plans to increase the airport construction fee levy on passengers – which is being used to partly finance the third runway project – despite a collapse in passenger numbers due to the Covid-19 outbreak.

Raymong Cheng, the head of the Transport and Housing Bureau's Airport Expansion Project Coordination Office, made the comment during a Legco economic development panel meeting on Monday.

In response to a question by lawmaker Claudia Mo over the Airport Authority's cash flow situation, Cheng said that the authority will continue collecting the levy until the debt is paid off.

The levy, which ranges from HK$70 to HK$180, is helping to pay for the HK$141 billion third runway project, but officials say the authority is considering borrowing more money from banks.

The authority's treasurer David Woo confirmed to lawmakers that they are arranging for a five-year HK$20 billion loan with major local and international banks, and that banks so far have responded positively to this during discussions about the credit facility.

"I think as the economy recovers, we are confident that our cash position will improve," Woo said.

"It's a five-year loan, and in our discussions with banks, they feel that the situation right now is short-term, was unforseeable, and it's not going to be permanent, so we are confident in that respect."

When asked by Mo if there is a chance that the government may need to bail out the authority as it has done with Ocean Park recently, Under Secretary for Transport and Housing Raymond So said "currently the government does not need to make financial arrangements or subsidies for the runway".

Meanwhile, Kevin Poole, the airport official in charge of the project, said work on the third runway is six weeks behind schedule due to delays in the supply of fill material for reclamation due to the pandemic.

He says he's confident of completing the work on schedule by 2024, and within the budget.

Civic Party lawmaker Jeremy Tam asked if the authority will sue contractors for the increased use of deep cement mixing (DCM) due to the lack of marine sand.

Poole replied: "You’re right, we’ve done more DCM, that is both to our advantage in terms of phasing, but also in terms of the long-term settlement of those things."

"So there are other technical advantages of using DCM and we continue to manage our projects in a normal project management style with all our contractors following up as necessary any conditions we need to impose."