1
WEDNESDAY, JANUARY 22, 1975
TELEPHONE CHARGES. FINANCIAL SECRETARY OUTLINES
GOVERNMENT'S PROPOSALS
* ×at | સ
+
THE APPLICATION BY THE HONG KONG TELEPHONE COMPANY FOR INCREASES RANGING FROM 71 TO 76 PER CENT IN RENTAL AND INSTALLATION CHARGES HAS NOT BEEN ACCEPTED BY THE GOVERNMENT.
+
INSTEAD, THE GOVERNMENT IS PROPOSING A +PACKAGE OF IMMEDIATE MEASURES+ INCLUDING INCREASES OF JUST UNDER 30 PER CENT IN ANNUAL RENTALS FOR BUSINESS AND RESIDENTIAL LINES.
ANNOUNCING THE DECISION IN THE LEGISLATIVE COUNCIL THIS
AFTERNOON, THE FINANCIAL SECRETARY, KR. PHILIP HADDON-CAVE, SAID THAT IF THE PROPOSED INCREASES WERE APPROVED THE NEW RENTALS WOULD BE $528 FOR BUSINESS LINES, $360 FOR RESIDENTIAL LINES, $396 FOR BUSINESS PARTY LINES AND $276 FOR RESIDENTIAL PARTY LINES. THESE COMPARED WITH $700 FOR A BUSINESS LIME AND $400 FOR
A RESIDENTIAL LINE IN THE APPLICATION SUBMITTED BY THE COMPANY.
HE SAID HE INTENDED TO INTRODUCE A RESOLUTION INTO THE LEGISLATIVE COUNCIL ON FEBRUARY 5 SEEKING APPROVAL FOR THE INCREASES FROM MARCH 1.
1
OTHER MEASURES WHICH THE FINANCIAL SECRETARY HAS PROPOSED TO THE COMPANY ARE 1-
* THAT THE COMPANY'S BOARD RECOMMEND TO SHAREHOLDERS THAT
NO DIVIDEND PAYMENTS BE MADE IN 1975
*
AND
THAT A GOVERNMENT DIRECTOR SHOULD BE APPOINTED TO THE BOARD OF THE TELEPHONE COMPANY.
IF THESE ARE AGREED THE GOVERNMENT WILL WAIVE ROYALTY
PAYMENTS BY THE COMPANY FOR 1974 AND 1975.
AT THE SAME TIME, THE FINANCIAL SECRETARY ANNOUNCED THAT THE GOVERNMENT INTENDED TO SET UP A COMMISSION OF ENQUIRY TO EXAMINE ALL ASPECTS OF THE COMPANY'S OPERATIONS.
HE POINTED OUT THAT THE REVISION IN RENTALS WAS NECESSARY NOW AS TO REFUSE ANY INCREASES IN CHARGES AT THIS TIME WOULD PRECIPITATE A CRISIS IN THE COMPANY'S AFFAIRS WHICH WOULD NOT BE IN THE PUBLIC INTEREST.
MR. HADDON-CAVE SAID THESE INCREASES +WILL NOT BE ENOUGH TO KEEP THE COMPANY'S HEAD ABOVE WATER AND UNDOUBTEDLY EXTENDED BANK CREDITS WILL BE NECESSARY+.
IN ADDITION TO THE INCREASES, HOWEVER, IT WILL BE NECESSARY FOR THE COMPANY'S BOARD TO RECOMMEND TO SHAREHOLDERS THAT NO DIVIDEND PAYMENTS SHOULD BE MADE IN 1975. APART FROM THE FINANCIAL REASONS FOR THIS IT IS THE GOVERNMENT'S VIEW THAT THE SHAREHOLDERS SHOULD BEAR SOME OF THE CONSEQUENCES OF THE COMPANY'S PAST FAILURE IN MANAGEMENT.+
MR. HADDON-CAVE SAID