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A study has revealed that the Kowloon-Canton Railway Corp and the Mass Transit Railway Corp are among the eight most profitable railways in the world.

  The study of 37 rail networks was carried out by United States consultant AT Kearney.

  AT Kearney (Hong Kong) vice-president Robert Tasiaux said the study also proved that the two Hong Kong networks were among the most cost-effective as their fares were comparatively low.

  This was despite the fact that ticket prices were not subsidised by the Government. Mr Tasiaux said: 'The KCRC and MTRC have [some] of the least expensive fares in the world.'    The study said the two transport organisations had to negotiate with the Legislative Council if they wanted to increase fares.

  This compared with other systems elsewhere in the world where the decision rested solely with politicians.

 'Basically Hong Kong and Singapore have reasonable control on revenue and they feel they have control of viability and manage their costs well,' he said.

   Mr Tasiaux said the study looked at various elements such as the size of population, labour costs, operating costs, staffing, cost per revenue vehicle per kilometre, the age of trains, passenger loading and length of trips.

  The findings confirmed that Singapore and Hong Kong had the least expensive rail networks in the world, he said.

  Mr Tasiaux said the railway network in the United States deserved the most criticism because managers had successfully won subsidies and fare increases, but had not made the best use of these resources.

  He said between 40 per cent and 70 per cent of the US networks' costs had to be funded by the government.

  In Hong Kong, the rail networks had created a successful system without the use of handouts, he said.

  Mr Tasiaux said some rail systems were suffering because of government intervention and meddling.

   Railways in Europe were forced by governments to hire a certain level of staff. This made up about half of their total operating costs, and in some cases as high as 80 per cent.

  He said some of the pressure on governments to intervene in the running of the railways came from the unions.

  Government intervention meant the authorities were effectively stopping railway networks' managements from doing their job properly.

  Saddled with higher costs, it was inevitable rail operators would have to go back to the government for more subsidies.

  'The important thing for Asia is you don't want the railways to repeat the mistakes in North America and Europe,' he said.

   In terms of business opportunities in Hong Kong, the US consultant said more companies would look at using the KCRC's connection to the mainland in the future.



Study says Hong Kong networks are among world's most cost-effective