• Mon
  • Dec 29, 2014
  • Updated: 1:41am

Passenger protection

PUBLISHED : Wednesday, 28 April, 1993, 12:00am
UPDATED : Wednesday, 28 April, 1993, 12:00am

THE Hongkong Ferry Company has a valuable public asset: a franchise from the Government to run services throughout the territory's waterways and to make money doing so. In return, it has obligations to the public. It should provide efficient services in well-kept vessels at a reasonable price. It is failing to meet these obligations.


Complaints about the standard of the services are a feature of Hongkong life. But the problem just now is the price the company wants to charge its customers. It is proposing to increase fares by almost a quarter.


The justification is that a 24 per cent rise is needed to cover the cost of improvements to services. Without improvements, fares would rise by 12 per cent, a figure meant to be in line with inflation. The president of the Hongkong Ferry (Holdings) Company, Mr Peter Wong Man-kong, observed this week: ''These are very tough times for the ferry industry.'' He is right. Just ask the passengers.


The company's proposal to increase its fares is in keeping with the approach traditionally adopted by monopolies which run essential public services. Charges are levied on a cost-plus basis, set at levels which cover the cost of running the services plusa margin for profit. The notion that costs must be kept down so that the charges to users might be kept as low as possible is not one that weighs heavily on the minds of those in control of public monopolies. The interests of the customer rank low on the list of priorities.


The Hongkong Ferry Company, however, has tried to take the views of the public into account. It will ask district boards and passengers whether they want improvements to piers, staff and ferries at the expense of the big fare rises. But the choice is really no choice at all. It is between getting a better service and paying a huge fare rise or keeping the much-criticised service and paying a big fare rise.


The company deserves credit for consulting the public but this step alone is not enough. A different approach is needed to its pricing policy.


Governments are the watchdogs of the public interest and usually tackle the problem of low efficiency and high charges by allowing competition. This is not easily done in the case of Hongkong's ferry services: it is hard to see rival companies running services from Central to Mui Wo and doing anything else but sinking each other's business.


The Government, however, should insist that the public's rights are protected, that they get decent services at decent prices. It should enforce performance standards in the quality of service and in the efficiency of the operation.


A monopoly franchise to run a public service might be seen as a licence to make money. No one would object to that, as long as the obligations that come with the licence are met as well.


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