WEDNESDAY, NOVEMBER 19, 1975
MOTION TO REVISE STAR FERRY FARES ADOPTED *******
A MOTION TO REVISE THE FARES OF THE +STAR+ FERRY AND TO WAIVE THE COMPANY'S ROYALTY PAYMENTS FOR THE THREE YEARS 1974-76 WAS PASSED BY THE LEGISLATIVE COUNCIL THIS AFTERNOON.
FIRST CLASS FARES WILL BE INCREASED TO 30 CENTS FOR ADULTS AND 20 CENTS FOR CHILDREN UNDER 16, WHILE SECOND CLASS FARES WILL BE 15 CENTS FOR BOTH ADULTS AND CHILDREN FROM NEXT MONTH.
SECOND CLASS FARES WILL BE FURTHER INCREASED TO 20 CENTS FROM JANUARY 1, 1977.
FROM NEXT MONTH, MONTHLY TICKETS WILL BE $12 FOR ADULTS AND $6 FOR CHILDREN. ACCOMPANIED CHILDREN UNDER THREE WILL NOT BE REQUIRED TO PAY ANY FARES.
SPEAKING ON THE MOTION, DR. THE HON, S.Y. CHUNG SAID THE FIRST CLASS FARE WAS 20 ̊CENTS IN 1946 AND REMAINED SO UNTIL 1966 WHEN IT WAS RAISED BY FIVE CENTS, WHILE THE SECOND CLASS FARE HAS REMAINED UNCHANGED FOR NEARLY 30 YEARS.
+ IT IS A RECORD OF ACHIEVEMENT THAT THE MANAGEMENT OF ANY PUBLIC UTILITY WOULD BE PROUD OF., HE SAID.
DR. CHUNG MADE A FEW OBSERVATIONS HOWEVER ON THE SPEECH MADE BY THE SECRETARY FOR ENVIRONMENT WHEN PROPOSING THE MOTION TO REVISE THE SCHEDULE UNDER THE +STAR+ FERRY COMPANY (SERVICES) ORDINANCE.
MR. ROBSON HAD SAID THAT THE ESTIMATED PROFITS OF THE COMPANY FOR THE FIVE YEARS 1974-78 WERE $800,000 PER ANNUM, COMPARED WITH AN AVERAGE OF $1.4 MILLION FOR THE PREVIOUS FIVE YEARS 1969-73.
DR. CHUNG SAID THAT IN ASSESSING PROFITABILITY, PROFITS MUST BE RELATED WITH SHAREHOLDERS INVESTMENT, AND ALTHOUGH HE DID NOT KNOW THE EMPLOYED CAPITAL AND SHAREHOLDERS FUNDS FOR THE COMPANY, HE KNEW THAT THE AVERAGE NET FIXED ASSETS FOR THE FIVE YEARS 1974-78 AMOUNTED TO $2.69 MILLION.
+THIS WOULD GIVE A NET RETURN ON AVERAGE NET FIXED ASSETS OF ALMOST 30 PER CENT PER ANNUM; WHICH IS VERY HIGH INDEED BY ANY STANDARDS,+ HE SAID.
HE ALSO DIFFERED FROM MR. ROBSON'S VIEW THAT IT WAS INAPPROPRIATE TO BASE THE ASSESSMENT OF RETURN ON A PERCENTAGE OF THE FERRY COMPANY'S FAST DIMINISHING FIXED ASSETS, SO AS TO JUSTIFY THE MANAGERIAL EFFORT.
/+THESE ARE
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