A simple formula worth keeping in mind has become of increasing importance to utilities around the world. It is called RPI-X.
The idea is that all utilities, and we shall include railways here, are to some extent monopolies. You may introduce competition, but it is always pointless, for instance, to have three gas companies lay pipes along a street when one will do.
So if they are to be held in private hands you want some regulation of tariffs to avoid overcharging of customers through their monopoly positions.
The traditional way in Hong Kong, and one employed in the United States, is to limit their profits to a set percentage of investment in plant and equipment. This has some failings. It can encourage them to invest more than they have to as a way of boosting profits. We have an example in accusations that CLP Holdings has over-invested in recent years and has thus taken too much money from power users.
The RPI-X approach is from a different angle. It says you take retail price inflation (RPI) minus some small figure (X) regularly reviewed by government and this is the maximum by which you allow utilities to raise charges.
The Mass Transit Railway (MTR) does not like RPI-X or any other regulatory scheme of that nature. It wants what it calls 'fare autonomy'.