New World First Bus

Bus fares in Hong Kong to go up as much as 7 per cent after government approves increase for Citybus and New World First Bus

  • Executive Council gives Citybus and New World First Bus permission to charge more
  • Price increases of 7 per cent and 5.6 per cent will take effect on January 20
PUBLISHED : Tuesday, 08 January, 2019, 3:39pm
UPDATED : Tuesday, 08 January, 2019, 11:03pm

It will be more expensive to travel around Hong Kong after the government approved a request from two of the city’s bus companies to raise fares.

On Tuesday, the Executive Council gave the nod to Citybus, and New World First Bus, which are both owned by NWS Holdings, to increase charges by 7 per cent and 5.6 per cent respectively.

The new fares, which will be the first rises in more than 10 years, will take effect on January 20, but are significantly lower than the 12 per cent asked for by the bus operators in August 2017.

But the government said about 90 per cent of Citybus passengers and 97 per cent of New World First Bus travellers would pay not more than HK$1 extra per trip or remain unaffected after the adjustment.

For example, for popular bus route 8P from Wan Chai North to Siu Sai Wan, the fare will rise from HK$6.1 to HK$6.4.

The council also approved fare increases on cross-harbour routes, with those run by Citybus and KMB at 7 per cent, while those by NWFB and KMB at 5.6 per cent.

But only about around 6.1 per cent of KMB passengers would need to pay an additional 20 cents or more per trip.

At a press conference on Tuesday, Deputy Secretary for Transport and Housing Kevin Choi Kit-ming explained the two firms faced an increased cost for hiring more drivers and improving the workers’ salaries and benefits after the government reviewed the guidelines on working hours, but they did not raise their fares for 10 years.

“In this year, the two companies recorded a loss … Under the circumstance that we care about the safety of franchised bus so much, it will not be so desirable if we request a company to provide public services when it has an unhealthy financial status,” he said.

In 2017 to 20 18, Citybus and New World First Bus incurred losses of HK$2.6 million and HK$5.1 million respectively.

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The two companies bore a growing operating cost due to the annual pay rise and increase in fuel costs, a government spokesman said, while they recorded a lower patronage since the commissioning of various railway lines.

He added that the two firms would still incur losses even if the fares were increased by 12 per cent as proposed.

“If the fare levels remain unchanged, the two bus operators will continue to run a deficit of a much larger magnitude in the coming years,” he said.

“That said, we also need to balance the passengers’ affordability and acceptability. Gradual fare increases would be more acceptable to the general public at large.”

The government said if the two companies still failed to maintain an ideal financial status after charging more, they might consider to file another application for a fare hike if necessary.

Gradual fare increases would be more acceptable to the general public at large
A government spokesman

Initially, the council approved an overall weighted average fare increase rate for the two operators at 9.9 per cent, based on a number of factors such as forecast of future costs, revenue and returns, as well as the quality and quantity of service provided.

But officials lowered it to the announced figures after taking into account the mitigating effect brought by the funds set up for the planned toll exemption on almost all tunnels and roads for buses – a measure unveiled by Chief Executive Carrie Lam Cheng Yuet-Ngor during her policy address in October.

Legco’s transport panel chairman Ben Chan Han-pan, of the pro-establishment Democratic Alliance for the Betterment and Progress of Hong Kong , said he could only reluctantly accept the fare hike because it had not adjusted the rate over the last decade. He said the two companies should be more cautious in managing their money to improve their financial status.

He added it was not an ideal time to announce the fare increase as the government’s non-means- tested transport subsidy scheme had just kicked in.

“It has an impression that the government subsidy was being eaten up,” he said, calling for a lower threshold as well as a higher subsidy under the scheme.

The scheme will see the government subsidising 25 per cent of commuters’ spending on public transport – covering all modes including the MTR, franchised buses, minibuses, trams and ferries – above an initial HK$400. The subsidy amount is capped at HK$300 per month.

Civic Party lawmaker Jeremy Tam Man-ho said the government could have further cut the increased rates in the light of the toll exemption.

He added the government should have requested the bus companies to implement the measures suggested in its report on franchised bus services released on Tuesday when it approved the fare increases.

In 2008, Citybus secured the council’s permission to increase its fares by 2 per cent, while New World First Bus was allowed to charge 5 per cent more.

Citybus, which mainly operates on Hong Kong Island with some cross-harbour routes, has a fleet of 744 vehicles on 85 routes, carrying about 495,000 passengers a day. New World First Bus operates 680 buses on 94 routes with 448,000 passengers daily.