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PUBLIC INTEREST SAFEGUARDED
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PROVISIONS ARE INCLUDED IN THE MASS TRANSIT RAILWAY CORPORATION TO ENSURE THAT THE PUBLIC INTEREST IS SAFEGUARDED.
THIS WAS STATED BY THE CHIEF SECRETARY, THE HON SIR PHILIP HADDON-CAVE IN THE LEGISLATIVE COUNCIL TODAY.
HE WAS REPLYING TO A QUESTION BY THE HON ANDREW SO, WHO ASKED WHETHER THE GOVERNMENT WOULD CONSIDER REQUIRING THE MTRC TO OBTAIN THE GOVERNOR IN COUNCIL'S PRIOR APPROVAL FOR ANY FUTURE REVISION OF ITS FARES.
SIR PHILIP SAID THAT UNDER SECTION 6(2)(F) OF THE ORDINANCE, THE MTRC IS EMPOWERED TO DETERMINE FARES PAYABLE BY ITS PASSENGERS, BUT HE ADDED:
+ALTHOUGH THE ORDINANCE DOES NOT REQUIRE SUCH FARES TO BE APPROVED BY THE GOVERNOR IN COUNCIL, IT HAS ALWAYS BEEN THE PRACTICE FOR THE CORPORATION TO INFORM THE GOVERNOR IN COUNCIL, THROUGH THE ADMINISTRATION, OF ANY INTENDED REVISION OF FARES IN ADVANCE.+
UNDER SECTION 13 OF THE ORDINANCE, THE CORPORATION IS REQUIRED TO CONDUCT ITS BUSINESS ACCORDING TO PRUDENT COMMERCIAL PRINCIPLES AND TO ENSURE AS FAR AS POSSIBLE, TAKING ONE YEAR WITH ANOTHER, THAT ITS REVENUE IS AT LEAST SUFFICIENT TO MEET ITS EXPENDITURÉ.
+THE CORPORATION MUST SEEK, THEREFORE, TO EARN ENOUGH REVENUE TO MEET OPERATING AND OTHER COSTS AND TO SERVICE ITS DEBTS. EVENTUALLY, IT WOULD BE REASONABLE TO EXPECT THE CORPORATION TO EARN A RETURN ON CAPITAL INVESTED, SIR PHILIP SAID.
+NEVERTHELESS, SECTION 20 OF THE ORDINANCE ENABLES THE GOVERNOR IN COUNCIL, IF IT IS THOUGHT THAT THE PUBLIC INTEREST SO REQUIRES, TO GIVE DIRECTIONS OF A GENERAL CHARACTER TO THE CORPORATION.+
HOWEVER, THIS IS SUBJECT TO THE PROVISO THAT THE CORPORATION SHALL BE FULLY COMPENSATED BY THE GOVERNMENT IN RESPECT OF ANY DIRECTION REQUIRING IT TO ACT CONTRARY TO PRUDENT COMMERCIAL PRINCIPLES, HE SAID.
+THERE COULD BE A LOSS OF REVENUE, FOR EXAMPLE, IF THE GOVERNOR IN COUNCIL WERE TO DIRECT THE CORPORATION TO LOWER FARES OR TO REFRAIN FROM INCREASING FARES FOR NON-COMMERCIAL REASONS.+
SIR PHILIP SAID THESE THREE SECTIONS OF THE ORDINANCE, TAKEN TOGETHER, ARE DESIGNED TO ENSURE THAT THE PUBLIC INTEREST IS SAFEGUARDED, BUT IN A MANNER WHICH IS CONSISTENT WITH THE CORPORATION'S OBLIGATIONS.
+THEY WERE THE SUBJECT OF DEBATE IN THIS COUNCIL IN APRIL AND MAY 1975 AND IT IS NOT THE GOVERNMENT'S VIEW THAT THE TERMS OF ANY OF THEM REQUIRE TO BE ALTERED.+
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