PART II
THE STAR FERRY FARE ISSUE
40. The 'Star Ferry Company Limited is a public company with a paid up capital of $2.4 million and over 500 registered shareholders. It is the smallest of the companies which operate the major public transport facilities in the urban areas of the Colony (two bus companies, one tramway and two ferry companies) under franchises granted by the Government.
41. The company operates two passenger ferry services between Edinburgh Place in the Central District of Hong Kong and points on the Kowloon Peninsula. These services are of great importance in linking the urban areas on either side of the harbour and during 1965 carried an average of 150,000 passengers daily. The Company employs 14 ferries on these services and provides what is generally acknowledged to be a high standard of service.
42. The operation of the services is governed by the 'Star' Ferry Company (Services) Ordinance which lays down the rights and liabilities of the franchise and, in particular, stipulates the payment of pier rent and royalty to the Govern- ment and the fares and charges which may be levied by the Company. The relevant section of the Ordinance dealing with fares is shown at Appendix 3. It provides for the Company to charge such fares as may be fixed by the Governor-in-Council as fair and reasonable having regard as well to the Company as the general public. It also enables the Company, in the event of a material change of economic or financial conditions or any other circumstances affecting the ferry service to submit the question of fare increases to arbitration if the fares fixed by the Governor-in-Council are not reasonably remunerative: and there is provision for the Governor-in-Council to submit the question to arbitration if the fares and charges are unduly high. The section also provides for the Governor-in-Council to vary the rate of royalty in lieu of increasing or decreasing fares.
43. The general fare structure of the Company's service has remained un- changed from 1st April, 1946 with the exception of an increase in August 1951 in monthly ticket charges.
Application for fare increase
44. On 1st October, 1965 the Company applied for an increase in fares. The reasons put forward in support of this application can be summarized as follows: