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SCMP Reporter

THE United Democrats clashed with their Legco colleagues over whether the Mass Transit Railway Corporation (MTRC) should have autonomy in setting its fares.

  Legislators debated into the early hours on United Democrat Lau Chin-shek's motion.

  Mr Lau was asking the company to explain the need to set its internal rate of return at 10 per cent and to consider scrapping inflation-linked fare rises.

  The debate was the third motion proposed by Mr Lau over the past 17 months on the running of MTRC.

  Although the motion was not supported by the Liberal Party, the Government and several independent members, it was eventually passed by a 16 to 12 vote at 12.45 am this morning.

  Edward Ho Sing-tin, a member of the Liberal Party and the managing board of the MTRC, said: ''Because so many travel on the MTR each day, it has become a natural target for politicians to try to shoot at.

  ''The law of the jungle in politics is: the bigger the target the easier the game,'' he said.

  ''If indeed Mr Lau and company wish that the MTRC were to be transformed into a government-subsidised loss-making railway, of which there are many examples in the world, then let them say so as well,'' he said.

  Those who had ''a pre-conceived agenda'' would not be interested in hearing how a good government-owned public transport system should be run.

  The corporation was a ''splendid example'' to the rest of the world on how a public transport system could operate on prudent commercial principles.

  But Mr Lau denied that his persistent call for monitoring of MTR fares was to grab votes.

  He said he had started asking for more information 10 years ago, but was ignored by the corporation.

  He noted that last year's MTRC net profits were up 82 per cent over 1992. There was no reason why it should raise its fares every year. Neither was it justified in pegging its fare rise to the inflation rate.

  Mr Lau claimed the company was contributing to the territory's inflation.

  But independent Jimmy McGregor said it was ''sound and desirable'' for the company to have inflation-linked fare increases, or else its financial viability would be called into question.

  In reply, the Secretary for the Treasury, Donald Tsang Yam-kuen, said the MTRC should seek a return because ''it is important to look forward to the future''.

  If fares fell in real terms, the future government would have to pump in funds for renewal and development of the system.

  The Hong Kong public also benefited enormously from the MTRC's ability to borrow at low rates of interest, which would not be possible if it could not maintain fares in real terms.

  The Secretary for Transport, Haider Barma, said: ''It would be suicidal to interfere by attempting to tie the corporation's hands. The corporation has not abused its financial autonomy in raising fares - on the contrary it has demonstrated that it is fully conscious of its civil responsibilities.'' 



Clash over autonomy of MTR in setting its fares