Five bus operators get nod to hike fares
By Teddy Ng and Louise Ho (HK Edition)
Updated: 2008-05-21 07:10

Commuters will have to spend more on transportation starting June 8 after the Executive Council approved five bus fare rise applications yesterday.

The approved rises range from two to 7.24 percent.

But the five bus companies given the green light expressed disappointment over the approved rates as they are lower than what they demanded.

Fares of Kowloon Motor Bus, which carries over two million passengers a day, will increase by an average of 4.5 percent, only half of what the company proposed.

Only 4.7 percent of its passengers will remain unaffected by the approved increase.

Long Win Bus Company, which mainly operates routes to and from the airport and North Lantau, is allowed to increase fares by 4.5 percent instead of 5.9 percent as requested. Only 5.5 percent of its passengers will remain unaffected.

Fares of Citybus Hong Kong Island and cross-harbor routes will increase by two percent, which is 3.8 percent lower than what the company demanded.

Nearly 75 percent of its passengers will remain unaffected.

New World First Bus will increase fares by five percent instead of the proposed 5.8 percent, affecting 98.8 percent of its passengers.

Only New Lantao Bus Company gets what it asked for, a 7.24 percent fare hike, which will affect 99.2 percent of its passengers.

The council rejected the 5.8 percent fare increase proposed for Citybus North Lantau and airport routes because the financial performance of these routes are strong in recent years - with revenues increased by 28.5 percent from 1999/2000 to 2006/2007.

Most of the affected passengers will pay about HK$0.4 more for each ride.

The average increase approved is lower than 4.67 percent, which is the outcome of a formula in the bus fare arrangement announced by the government in 2006.

Secretary for Transport and Housing Eva Cheng explained that the formula only provides a reference indicator for the government and will not operate as an automatic determinant of fare adjustment outcome.

She added that the government has fully considered and balanced all relevant factors in the bus fare adjustment arrangement, including changes in operating costs and revenue since the last fare adjustment, forecasts of future costs, revenue and return, the quality and quantity of service provided, the outcome of the formula, public acceptability and affordability.

Citybus and New World First Bus said they were displeased with the approved fare hikes as they were inadequate to compensate the rising fuel cost.

The companies added that it will be difficult to maintain service quality with the increasing cost.

A spokesman for Kowloon Motor Bus said they accepted the approval, but added that this is the company's first fare hike in more than 10 years.

He said fuel prices have increased by 60 percent since September, and the fuel cost will increase by HK$1 million per month every time the oil price edges up by US$1 per barrel.

But a document submitted by the Transport and Housing Bureau to the Legislative Council stated that the government accepts the bus companies' cost forecasts except for their assumed fuel cost, which is considered to be on the high side.

Betty Wong, a 40-year-old teacher living in Southern District, said the fare hike is unacceptable.

"The increase is too much," she said. "But there's nothing I can do. No other means of transportation is available in Southern District."

Keith Law, a 23-year-old university student, said he will opt for other transportation choices more in the future.

Coalition to Monitor Public Transport and Utilities spokesman Richard Tsoi Yiu-cheong said the fare increase should not exceed the inflation forecast of 3.4 percent.

"The fare increase will worsen the current inflation as it is even higher than the salary rise. It will add to the burden on the poor," he said.

Tsoi urged the government to expand the transportation subsidy scheme, which helps poor families in four districts.

Legislative Council transport panel chairman Andrew Cheng suggested the government stipulate that bus fares should be reduced if fuel prices go down.

(HK Edition 05/21/2008 page1)