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The following is issued on behalf of the Transport Advisory Committee:
The Transport Advisory Committee (TAC) was briefed today (July 28) on the latest progress of the Government's discussion with Citybus Limited (Franchise for Hong Kong Island and Cross-Harbour Bus Network) (Citybus (Franchise 1)) and New Lantao Bus Company (1973) Limited (NLB) on the granting of new 10-year franchises, as well as the outcome of the Government's study on a taxi fuel surcharge - one of the issues covered by the Topical Study under the Public Transport Strategy Study (PTSS).
The current franchises of Citybus (Franchise 1) and NLB will expire in 2016 and 2017 respectively. The TAC Chairman, Mr Larry Kwok, said, "The Committee notes that the Government's discussion with the two grantees has progressed well. Both grantees have all along been providing a proper and efficient bus service under their current franchises. They have not increased their fares since 2008. They have together offered fare concessions amounting to $179 million under the passenger reward arrangement during their current franchises. Meanwhile, the two grantees are willing to continue to invest in bus operation, including making an investment of a total of around $770 million for bus fleet replacement in the coming five years.
"Members welcome that the two grantees have agreed to fully take on board the new franchise terms and service commitments of the three franchises commencing in 2013 (i.e. franchises of New World First Bus Services Limited, Long Win Bus Company Limited and Citybus Limited (Franchise for Airport and North Lantau Bus Network)), as well as to introduce new franchise terms and make commitments on specific initiatives in three areas, namely provision of passenger information, government regulation and fare concessions. Such new initiatives include the introduction of a real-time bus information system in phases and more fare concession schemes. The Committee will make recommendations to the Chief Executive in Council on the granting of new franchises at an appropriate juncture."
On the other hand, the taxi trade had earlier proposed to introduce a taxi fuel surcharge so that there could be an additional channel for collecting extra fares outside the regular taxi fare adjustment mechanism in times of fuel price fluctuations.
"The Committee notes that the Government has all along been taking into account a number of factors when processing the application for taxi fare adjustment. These factors include overall cost (including fuel cost), overall revenue and net income as well as public acceptability. In general, the present mechanism is effective and can maintain a balance between the expectations of the public and the taxi trade. The imposition of any fuel surcharge will automatically transfer the burden of fuel cost to the passengers. This may cause confusion and give an impression that passengers are subject to a 'double fare increase'. Besides, the setting of the fuel price level that would trigger the taxi fuel surcharge and the exact surcharge amount entail rather complex arrangements and calculations. Consensus amongst all parties would not be easy to come by. At the same time, the introduction of such a surcharge may lead to a chain reaction in other public transport services (such as franchised buses and public light buses)," Mr Kwok said.
"Members note that, overall, the Government holds the view that the introduction of a taxi fuel surcharge is not meritorious. Changes in operating costs caused by fluctuations in fuel prices should continue to be addressed through the existing fare adjustment mechanism. The TAC agrees."
When studying whether it is feasible and meritorious to introduce a taxi fuel surcharge in Hong Kong, the Transport Department (TD) looked into the experience of 17 other places in implementing and not implementing a taxi fuel surcharge. The TD also carried out a survey in the fourth quarter in 2014 to collect views of taxi passengers, drivers and some academics towards the proposal.
Mr Kwok added, "The Committee notes that experiences of other places show that the levy of a taxi fuel surcharge is not common. Views collected also show that the public views towards the proposal are mixed, with more people opposing it."
As a next step, the Government will conduct a review on the role and positioning of taxis under the Role and Positioning Review (RPR) of the PTSS. A major issue to be reviewed is whether it is feasible and meritorious to introduce new type(s) of taxi service, such as premium taxis, having regard to the implications over other public transport services. In the process, the Government has to take into account the roles and positioning of different public transport services to ensure their complementarity, while affording passengers efficient services and reasonable modal choices. According to the present work plan, the entire RPR for reviewing the roles and positioning of various public transport services will commence later this year and is expected to be completed in about two years' time.
Ends/Tuesday, July 28, 2015
Issued at HKT 15:02
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