A LEGISLATIVE Council panel has rejected a fare increase for Hong Kong Ferry earlier approved by the Executive Council. Transport panel members argued the extra revenue generated from a pier development project in Central could cover the increased cost of operation. Yesterday, the company hit back, threatening to cut ferry lines to minimise losses. The company has applied for an average 13.9 per cent fare rise from January, and for outlying islands and new town routes it wants an 18.2 per cent increase. The Democratic Party, which holds 19 votes, said it would vote down the increase when it went to the full Legco early next month. 'The profit generated from the pier project could help to stabilise the fare and the company should not increase the fare,' said Lau Chin-shek. He claimed it was understood that profits from the pier project could help cover the cost when Exco approved the plan in July. The Democratic Alliance for the Betterment of Hong Kong proposed lowering the rate of increase to less than 10 per cent, while the Liberal Party said it would support the rise. But the Government said the profit generated from the pier project was inadequate to cover increasing costs in the long-run. The Deputy Secretary for Transport, Issac Chow Yiu-nam, said the extra revenue would be a fixed amount, and as such, would not cover unanticipated long-term cost increases. The company's president, Peter Wong Man-kong, said they might have to cut 11 ferry lines in the next three months to minimise losses, or even withdraw the franchise if the increase was refused. The first four lines affected would be those from Central to Jordan, Hunghom to North Point, Kowloon City to North Point and Kwun Tong to North Point. The remaining seven would be gradually cut in the next three months. 'The number of passengers has been decreasing over the past year and we have been suffering great losses,' said Mr Wong. He stressed the rate of increase did not exceed accumulative inflation over the past 18 months. 'The increase is far below inflation and we have already subsidised more than $100 million on the fare this year.' The company also cited a drop in passenger numbers as some lucrative routes have been lost to government reclamation projects.