Idea of fuel surcharge on bus fares rejected

PUBLISHED : Thursday, 01 September, 2005, 12:00am
UPDATED : Thursday, 01 September, 2005, 12:00am

Companies feeling pain of surging oil prices are told to cut their costs instead

The three biggest bus companies said yesterday they hoped for government permission to impose a fuel surcharge on passengers to counter surging oil prices.

But the government swiftly rejected the idea, saying there was no precedent for imposing such a fuel surcharge on mass public transport. Instead, it called on the operators to try to minimise other operating costs.

The impact of rising oil prices has started to spill over to operators of trucks, buses, ferries and minibuses, sparking calls for concessions on diesel duties.

Last week, New World First Ferry said it was facing imminent pressure to raise fares. Operators of 40 green minibus routes have applied for fare increases. Some school bus operators also said they would increase charges by 10 per cent because of high fuel prices.

Complaining about rising operating costs, Winnie Ng, executive director of Kowloon Motor Bus, said the government should give a thought to allowing the company to collect a fuel surcharge from passengers.

'We hope the government could consider this because there are similar proposals by other transport trades such as the shipping industry,' she said.

A spokeswoman for KMB said the company had no specific proposal for a fuel surcharge and would not say if it had raised the idea formally with officials.

KMB has said fuel costs have almost doubled, from 7 per cent of its total costs last year to 14 per cent now. Also, the recent toll increase for Eastern Harbour Tunnel had cost it an extra $60 million so far.

The surcharge suggestion from KMB, the largest bus operator, was backed by New World First Bus and Citybus. A spokeswoman for the two operators said they had informally exchanged views with the government on the idea.

'The oil price trend remains uncertain and we have to consider a basket of factors, such as expanding our income base and controlling expenditure,' she said.

However, the Environment, Transport and Works Bureau yesterday quickly shot down the idea, saying the operators had already benefited from exemption from diesel duties.

'The government has already waived diesel duty for them. As franchised buses serve the majority of the general public and there has been no precedent of a fuel surcharge, it is inappropriate to have such an arrangement,' a spokesman said.

Meanwhile, labour-sector legislator Wong Kwok-hing, the Motor Transport Workers General Union and the Container Transportation Employees General Union have written to Financial Secretary Henry Tang Ying-yen, asking him to exempt commercial drivers from paying the $1.10 per litre diesel duty to ease the burden on them.