WEDNESDAY, AUGUST 10, 1977
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FIRSTLY, HE SAID, WAGES WERE THEMSELVES A PRICE FOR LABOUR SERVICES AND WOULD TEND TO INFLATE AT THE SAME RATE AS THE GENERAL PRICE LEVEL. SECONDLY AND MORE IMPORTANTLY, HE ADDED, WAGES WOULD BENEFIT FROM INCREASES IN PRODUCTIVITY AND THE TREND RATE OF INCREASE IN OUTPUT PER HEAD WAS BETWEEN 3 AND 4 PER CENT PER ANNUM.
+BY 1980 WE CAN EXPECT REAL WAGES TO HAVE INCREASED BY AT LEAST 16 PER CENT WHEN COMPARED WITH THE IR 1975 LEVELS.+
AS TO WHETHER THE FARE STRUCTURE WOULD AFFECT INDUSTRIAL COSTS, MR. HADDON-CAVE POINTED OUT THAT WITH OR WITHOUT THE MTR THE RELATIVE COST OF TRANSPORT WAS GOING TO RISE BECAUSE IT WOULD BECOME INCREASINGLY EXPENSIVE TO MOVE A GROWING POPULATION IN A LIMITED SPACE.
HE ALSO ASSURED THAT OUR FISCAL RESERVES WOULD BE ADEQUATE TO SECURE OUR CONTINGENT LIABILITIES OVER THE NEXT DECADE.
TRENDS IN PUBLIC TRANSPORT FARES
DEFENDING THE ASSUMPTION BY THE MTR CORPORATION THAT FARES WOULD INCREASE IN LINE WITH A 7 PER CENT ANNUAL INFLATION, MR. HADDON-CAVE POINTED OUT THAT BETWEEN 1946 AND 1970 THERE WAS VERY LITTLE CHANGE IN PUBLIC TRANSPORT FARES, BUT BETWEEN 1970 AND 1976 CMB FARES INCREASED BY ABOUT 150 PER CENT, KMB BY 110 PER CENT, TRAMWAYS BY 100 PER CENT, THE HONG KONG AND YAUMATI FERRY BY OVER 160 PER CENT AND THE STAR FERRY BY 33 PER CENT. REPRESENTING AVERAGE ANNUAL RATES OF INCREASE OF 16.7 PER CENT, 13.3 PER CENT, 12.2 PER CENT, 17.8 PER CENT AND 4.9 PER CENT RESPECTIVELY.
IT WAS REASONABLE FOR THE CORPORATION FROM A COMMERCIAL POINT OF VIEW TO ASSUME A RATE OF 7 PER CENT, HE SAID, AND THE 7 PER CENT INCREASE WOULD BE AN AVERAGE OVER THE PERIOD AND NOT IN EACH AND EVERY YEAR, SO THE MTRC WOULD NOT +FORCE THE PACE+ FOR OTHER PUBLIC TRANSPORT FARES.
HE POINTED OUT THAT BUSES WERE MORE LABOUR INTENSIVE AND WAGES COULD BE EXPECTED TO RISE FASTER THAN THE GENERAL PRICE LEVEL WHILE THE PUBLIC WAS PROBABLY GOING TO DEMAND A MORE COMFORTABLE BUS JOURNEY, WHICH WOULD TEND TO INCREASE BUS FARES QUITE INDEPENDENTLY OF THE MTR.
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DEMAND FOR PUBLIC TRANSPORT
ON THE EXPECTED PROPORTION OF PUBLIC TRANSPORT PASSENGERS TO BE CARRIED BY THE MTR, MR. HADDON-CAVE SAID THE RAILWAY'S POTENTIAL PASSENGERS IN 1986 OF 1.8 MILLION OUT OF A TOTAL OF 7.5 MILLION PASSENGERS ON PUBLIC TRANSPORT EACH DAY, REPRESENTING A RATIO OF 1 TO 4 ONLY, WAS NOT RATHER OPTIMISTIC'.
HE SAID BY THE STRATEGIC SITING OF THE 26 STATIONS ON THE EXTENDED SYSTEM, ALMOST 40 PER CENT OF HONG KONG'S POPULATION AND ALMOST 50 PER CENT OF THE PLACES CF EMPLOYMENT WERE JUDGED TO BE WITHIN WALKING DISTANCE OF A STATION.
/+A HEARTENING
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