XN000022-1972-06-07 — Page 22

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Wednesday, June 7, 1972

"At present levels of fares this falling off in numbers of

passengers can only means steadily declining revenue for the Tramways

in the face, as I have said, of steadily increasing costs. As a result

profits will continue to fall until, before very long, the operation

will begin to run into the red."

The Financial Secretary said it was clear, in these circumstances,

that measures must be taken to improve the company's financial position

if it was to continue to perform efficiently its proper role in the

overall public transport system on Hong Kong Island,

He pointed out that the elimination of royalty and the abolition

of statutory concessions to members of the armed forces and Government

uniformed personnel travelling on trams would still not be sufficient

to prevent a further deterioration of the company's financial position.

The pincers of rising costs and falling revenue could only be

prised open by a general fare adjustment, he said.

Various courses were examined by both the Government and the

Transport Advisory Committee in the light of their possible consequences

for passengers as well as for the company's finances. The only viable

course seemed to be the abolition of the present two-class fare structure

by introducing a single 20-cent flat fare.

"On top of the increased revenue this would bring in, it would

have the additional merit of increasing operational efficiency and

flexibility," Mr. Haddon-Cave said. "Furthermore, the social attitudes

that led to the establishment of a two-class fare structure on the

Tramways as long ago as 1911 are obviously outdated."

The Financial