'Adverse Consequences If Bus Fares Don't Go Up'

The government has defended its decision to approve fare hikes for four bus companies, warning that failure to do so could lead to layoffs and other "adverse consequences".

At a Legco question session on Wednesday, Federation of Trade Unions lawmaker Alice Mak told Chief Executive Carrie Lam that many people are angry with the increases, which come at a time of economic downturn and rising unemployment.

Lam noted that the government had rejected applications by bus companies for higher fares in the past few years, with some of them seeing no increase in almost a decade.

The CE acknowledged the decision to give the green light was a "very, very difficult" one.

"We are fully aware that the economy is in doldrums. We have a high unemployment rate and people are suffering. If we increase bus fares now, of course it would add to people's spending," she said.

"We have studied in detail the accounts of all the bus operators. All of them are really suffering huge losses. If there is no increase in fares, that means the quality of bus services will substantially go down, or bus companies will have to lay off staff or put them on unpaid leave, affecting grassroot residents.

"If fares don't go up, these adverse consequences that I've mentioned, you will see them at once."

Lam also said she hopes other government measures can help relieve people's burden.

The Executive Council on Tuesday endorsed an 8.5 percent increase by Citybus and New World First Bus on April 4, with another 3.2 percent hike to take effect in January next year.

KMB will charge commuters an average of 8.5 percent more, while fares for New Lantao Bus company will go up by 9.8 percent.

Officials extended the public transport subsidy scheme and increased the maximum monthly rebate to HK$500 to mitigate the effects of the fare increase.

Transport secretary Frank Chan also asked people for their understanding, saying the government has to ensure that public transport will continue to operate and help protect the jobs of some 20,000 bus workers.

He played down fears this would lead to other operators raising fares as well.

"We are not taking the public buses' fare adjustment as a pilot. As far as our policy is concerned, it's only for those public transport, which has a genuine need for fare adjustment, then we would consider. If any bus company or any public transport mode... are making reasonable profit, we would not be considering their application for fare adjustment," he said.