XCR (79)53
RESTRICTED
C
11
(ii)
(iii)
(iv)
That fuel costs will increase by 15% in 1979.
That wage rates will increase by 20% from March (employees are currently earning, on average, $1,000 dollars per month, and the company has had to promise them this increase in order to retain their services).
That other variable costs will increase by 8% p. a.
Whilst the profit of $205,000 may seem high, Members will wish to know that no allowance has been made, in this calculation, for the costs of improving the waiting area at Rennies Mill. (see para. 14 below) Subject to unforeseen circumstances, no further fare increase is envisaged prior to 1982, although it should be noted that the Company may be required to re-provision the pier at Shau Kei Wan in 1981 as a result of reclamation work, and it may be necessary to re-examine the position at that time.
12
Bearing in mind the foregoing facts and the need to continue to provide ferry services on these routes, the Commissioner for Transport supports the fare revisions sought by the Hop Shing Kung Company Limited.
13
A draft licence which it is proposed to grant to the Hop Shing Kung Company Limited, with effect from 1st March 1979 is attached at Annex C, under which the Company shall pay to Govern- ment a sum of five thousand dollars as monthly rent for the exclusive right to maintain the ferry service. The Commissioner for Transport has issued a temporary licence under regulation 60
of the Ferries Regulations to cover the period between 1st December 1978 and 28th February 1979.
Transport Advisory Committee
14
The Transport Advisory Committee has been consulted and has advised that the Company's licence should be renewed for a further three years and that their proposed fare increase should be supported.
G.S. 84
RESTRICTED