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Carrie Chan

Tate's Cairn stakeholder ponders future if it can't raise fees

A major stakeholder in the Tate's Cairn Tunnel has said it might try to sell the tunnel to the government if its proposed fee increases are not approved.

The move comes after the privately run Eastern Harbour Tunnel won the right to increase tolls by as much as 67 per cent, following  a tussle with the government in arbitration.

NWS Holdings wants to raise the tolls on Tate's Cairn Tunnel.  The toll for a private car would rise from $10 to $12, and for a double-decker bus the fee would go from $20 to $26. But legislators gave the thumbs-down to the  proposed increases in February.

NWS Holdings chief executive Chan Kam-ling said yesterday the company  had been losing money for 16 years.

The  group is one of the four stakeholders in the Tate's Cairn Tunnel Company.

The company was granted a franchise to build and operate the tunnel linking Sha Tin and Diamond Hill for 30 years in 1988. The tunnel cost about $2 billion to build. By the end of June last year, the company had accumulated losses of $453 million.

Reasons cited for the losses included the relocation of manufacturing to the mainland and the inability to increase tolls as planned.

'If the government proposed to buy back the tunnel, we would be interested in negotiating with  them,'  Mr Chan said. He also said they would seek arbitration if the application for the proposed fee raises were turned down.

'After eight months this application still has not been approved. We have been hurrying the government to reach  a decision,' he said.

Lawmaker Lau Kong-wah, chairman of Legco's transport panel, said that selling the tunnel would possibly be better than resorting to arbitration.

'We would not want to see a huge toll increase resulting from the arbitration,' he said.

Panel member Andrew Cheng Kar-foo said if there was a big toll increase for the Tate's Cairn Tunnel, huge pressure would mount on the government-owned Lion Rock Tunnel.

'In the long run, it would be  easier to co-ordinate traffic if both tunnels linking Kowloon and the New Territories were owned by the government,  although the financial situation might not allow it,' he said.

'If not, the government might also consider buying a stake in the tunnel.'

A spokeswoman for the Environment, Transport and Works Bureau said the government was still considering the toll increase proposals, but would not comment on the purchase option because it was hypothetical.

About 61,200 cars pass through the tunnel daily, against its design capacity of 78,500.



Let us raise tunnel toll or we may have to sell: operator