The UGC supports capital works projects of institutions for UGC-approved activities by capital grants. These are sought from the Administration on an annual basis under the Capital Programme, and the Alterations, Additions, Repairs and Improvements (AA&I) Programme.　

The Capital Programme handles major works projects costing more than $21 million each, such as construction of academic buildings and student hostels, etc. Institutions' capital proposals supported by the UGC are subject to a competitive selection process by the Government under its annual Capital Works Resource Allocation Exercise (CWRAE). The selected projects will then be put forward to the Legislative Council (LegCo) for funding approval. In 2009-10, the capital works projects under the UGC umbrella continued to increase, due to the need to provide more space by 2012 for the implementation of the new "3+3+4" academic structure.　

The AA&I Programme deals with smaller scale projects costing not more than $21 million for alterations, additions, repairs and improvements works to the campuses of the UGC-funded institutions, such as spatial reorganisation, minor slope stabilisation, and detailed design works for new UGC-funded building projects, etc. Institutions' AA&I proposals supported by the UGC are put forward to the Government to bid for funding under the Government's Capital Works Reserve Fund. Selected AA&I projects are funded under AA&I Block Vote approved by the LegCo.

In 2009-10, we obtained LegCo's funding approval for 16 capital works projects with a total estimated project cost of some $8.5 billion, bringing the number of ongoing capital works projects to 29 with a total estimated project cost of some $12.8 billion. The expenditure on these projects in 2009-10 was about $1.2 billion. With the commencement of construction of the newly approved projects, the spending in 2010-11 is anticipated to increase to some $1.9 billion. Among the 29 projects, 25 were under active construction to provide over 200 000 m² of new teaching and learning space and some 6 600 publicly-funded hostel places to meet institutions' existing shortfalls and to provide additional academic space and hostel places for implementation of the new "3+3+4" academic structure. Three of these projects were at the completion stage - School of Communication-cum-Creative/Visual Arts Building of Hong Kong Baptist University, Teaching Building at Chak Cheung Street (Phase 2) of The Chinese University of Hong Kong, and Multimedia Building of City University of Hong Kong.

With the support of the UGC and the Administration, four more capital works projects have entered into the detailed design stage in preparation for seeking LegCo's funding approval. The total estimated cost of these four projects amounts to $1.3 billion. They will provide a variety of facilities, including teaching and research space, research archive, and student hostels.

In 2009-10, the UGC supported a total of 39 new AA&I projects submitted by institutions, including 8 projects as additional projects with total estimated cost of some $72 million for implementation in 2009-10, and 31 projects with total estimated cost of some $455 million for implementation in 2010-11. Distribution of project estimates by institutions is as follows:　

Chart 9: Distribution of project estimates

CityU - New water-cooled chillers	HKUST - Newly reorganised teaching laboratory

To meet the expenditure of the ongoing and newly approved projects in 2009-10, a total of $320 million was allocated to institutions. This included some $113 million for 35 new projects and some $207 million for 51 on-going projects approved by the UGC in earlier years. The distribution of allocation by institutions is as follows:

Chart 10: Distribution of allocation in 2009-10

CUHK - New pedestrian pavement along Central Avenue	LU - New Multi-purpose IT Learning Environment