7 The 1983 Taxi Review concluded that taxis contributed more to congestion than private cars and that the need for taxis as an adjunct to public transport was diminishing. Its package of recommendations included a two year freeze on taxi numbers. As a result of strong opposition from taxi operators, in 1984 the District Boards were consulted and they were unanimously opposed to equating taxis fully with private vehicles. However, there was general support for a freeze on the issue of new taxi licences and on 17 July 1984 Executive Council decided that 'there should be a moratorium on the issue of new licences for New Territories taxis, and a restriction on the issue of new licences for urban area taxis to 200 per year, to be reviewed after two years'.
8 As the 1979 White Paper had stated that 'the Government has no wish to impose restraints before they are necessary', fiscal restraints on car ownership were recommended in May 1982 only after it was clear that measures such as area traffic control and public transport priority schemes could not by themselves prevent continuing deterioration in traffic conditions, if growth in vehicle ownership and use were to continue. The Secretary for Transport stated when moving the second reading of the Motor Vehicles (First Registration Tax) (Amendment) Bill 1982 in the Legislative Council on 5 May 1982 that 'On social and economic grounds, it is considered undesirable to deny aspirations of ownership completely, and Government considers therefore that other measures should be tested before direct restraint on ownership is resorted to'. The Financial Secretary echoed this point in his speech in Legislative Council on the same day: 'For many years it has been Government policy that taxes should in the main be raised for fiscal purposes. . . I am myself opposed as a general rule to the concept of taxation for non-fiscal ends. . . I am, however, persuaded that the Government must now take action with regard to the obvious problem of growing road congestion'.
9 It was against this background of a general dislike of the blunt instrument of fiscal measures against car ownership that, on 16 March 1983, Executive Council decided that the pilot study of electronic road pricing should be conducted as a possible means of directly controlling road use by private vehicles.
Comments on Director of Audit's Report
10 The Director of Audit criticizes the Government for not implementing the parking and taxi control measures recommended in the 1979 White Paper and attributes the need for the Electronic Road Pricing (ERP) Pilot Scheme to Government's 'inefficiencies, including delays, inaction, uncertainties and inconsistencies' in this regard. He finds merit in the package of restraint measures set out in the 1979 White Paper, 'because they were designed to achieve similar objectives to those proposed for the Electronic Road Pricing Scheme but without the high capital and recurrent costs'. He seems not to appreciate that transport policy must be constantly evolving. There has been no change in the basic policy that priority should be given to public transport over private cars and taxis, but it is entirely inappropriate for any Government to insist on sticking rigidly to measures devised some years before and to refuse to consider new alternatives which may prove to be better solutions. The Director criticizes Government for not giving adequate consideration to the restraint potential of high parking charges and high taxi fares. In this he fails to give sufficient. attention to the economic, social and other constraints and developments which must be taken into account in the formulation of policy to ease traffic congestion.
11 There is no reason why the Secretary for Transport should have reconsidered other options before proceeding with the Electronic Road Pricing Pilot Scheme. The fact that high parking charges and high taxi fares (unacceptable as they would be to certain sectors of the community) may to some extent be alternative methods of restraint is no argument for not considering ERP as a further option. The Director of Audit himself stresses the importance of examining all the available options in devising an effective restraint policy; and this approach must include ERP as well as controls over parking charges and taxi fares; and ideed, any other potential measures which may be suggested. The fiscal measures of May 1982 have been effective, although it could not have been foreseen at the time that for political and economic reasons they would have such a significant effect on car ownership as they have actually had. The aim was to limit the annual growth in the number of cars to 5%, not to reduce the size of the licensed fleet by 25%. The Director of Audit avoids comment on the fact that high taxes on car ownership are very blunt and inequitable; that they do not restrain usage directly, and that they impose a burden on all car owners, not just those who are heavy users of congested roads. It was necessary for Government and this was clearly recognized by Unofficial Members in the debate in 1982-to examine the feasibility of a system which would not have these disadvantages, and it would have been irresponsible not to have proceeded with the ERP pilot project.
B. UNIVERSITIES AND POLYTECHNICS STUDENT FINANCE
(Paragraphs 107–123)
The basic policy objective of the scheme is to ensure that no student who is offered a place in one of the five institutions of higher learning (HKU, CUHK, HKP, CPHK, HKBC) is unable to accept that place because of lack of means. The level of assistance given should be sufficient to enable the student, together with his other means, to meet all reasonable expenses which he is likely to incur.
2 In 1969 the Executive Council considered the various ways such assistance could be provided, viz:
(a) entirely by grants;
(b) by a combination of grants and interest-free loans; and
(c) entirely by means of interest-free loans,
and advised that a combination of grants and loans would be the most appropriate, the grants to be related to expenditure on fees, books, stationery and equipment and the interest-free loans to living expenses.
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