Commuters face a bus fare increase averaging 3.9 per cent next month after the government approved an application by KMB yesterday.
The rise, approved by the Executive Council, is lower than the 4.3 per cent the bus company applied for. It last raised fares in March last year, by 4.9 per cent.
Secretary for Transport and Housing Professor Anthony Cheung Bing-leung said the increase "should be acceptable" to the public.
He said 86 per cent of the passengers would pay up to 40 cents more. Fares for the remaining 14 per cent would go up by between 50 cents and HK$1, while less than 0.1 per cent would pay more than HK$1 extra.
Cheung said the government considered changes in the bus company's operating costs and revenue, a forecast of its future business and the public's ability to pay. He noted that the company had recorded losses of HK$43 million in 2012 and HK$12.4 million last year.
An Ombudsman report released in January slammed government officials for failing to deal adequately with the growing number of complaints against bus services. Cheung said the Transport Department was looking into them.
KMB plans to use its increased revenue to improve manpower arrangements, upgrade its bus fleet and enhance services.
NeoDemocrats lawmaker Gary Fan Kwok-wai said the increase was unreasonable because route rationalisation in the past year had already helped KMB reduce its losses.