XN000022-1982-11-24 — Page 18

WEDNESDAY, NOVEMBER 24, 1982

DAN JAH

CALL FOR MORE EQUITABLE+ PERMITTED RETURN

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THE HON WONG PO-YAN SAID AT THE LEGISLATIVE COUNCIL THAT THE PROVISION IN THE SCHEMES OF CONTROL TO ALLOW PERMITTED RETURN OF THE ELECTRICITY COMPANIES TO BE BASED ON AVERAGE NET FIXED ASSETS WAS +DEBATABLE+.

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HE SUGGESTED THAT THE PERMITTED RETURN OF THE TWO COMPANIES BE BASED ON A MORE EQUITABLE BASIS, SUCH AS SHAREHOLDERS FUND, WITH THE PERCENTAGE TO BE DISCUSSED AND AGREED IN OPEN.

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3MT M1 38 0 100 SHRI HUA SUATWYDAY UNICANT 131AMIT23 34 ** ** HE NOTED THATƆÆBE NET 'RETURN OF THE CHYNAMEIGHTS AND POWER: 339

COMPANY BETWEEN 1967 AND 1979 EXPRESSED AS A PERCENTAGE OF AVERAGE SHAREHOLDERS FUND FLUCTUATED BETWEEN 14.7 AND 17 PER CENT, A RELATIVELY CONSISTENTJANDI STABLE PATTERN WASa SHOWIE DENOTI AGO AN AVERAGE OF 16.281PER DENTÄGA #HUTER JATOPAMI - 5184M02A39 A 21 21HT

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HOWEVER, THIS PERCENTAGE JUMPED PERCEPTIBLY TO 20.3 PER CENT IN 1980, 24 PER CENT - IN 1984.AND. COULD SUBSTANTIALLYSQ NCREASET TO AN UNJUSTIFIABLE 30 PER CENT AND OVER WITHIND THE NOS TOKEWA YEAR30X3 IVEN THE SCHEDULED INCREASE OF THE FIXED ASSETSAT HEASANDIW OWIJAJC MEHW

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MR WONG ATTRIBUTED SUCH INCREASES/TO-THAS PERMITTED RETURN. BEING RELATED TO AVERAGE NET FIXED ASSETS.

GOWEVER 38 OT

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J +UNDER THIS PROVISION, BECAUSE OF THE÷EXPANSION¬QNZFHXED ASSETS, THE PROFIT OF THE ÉLECTRICITY COMPANTES/INZTERMS OF CA3TZWI PERCENTAGE OF SALES REVENUE WILL INCREASE DISPROPORTIONATELYąгRĘŻA SAID, ADDING THAT THE PROFIT PER UNIT OF ELECTRICITY SOLD WOULD THEN CEASE TO REFLECT REALISTICALLY EITHER SALESMORZOPERASJONALNT+ EFFICIENCY.

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IT IS ALSO EVIDENT THAT BECAUSE THE RETURN OF ANY YEAR IS ASSURED, THE DECREASE OF SALES OR THE SLOW DOWN OF GROWTH OP ELECTRICITY CONSUMPTION RATE WILL EFFECT A TARIFF INCREASED TOW 21 AUTOMATICALLY.

ANA 3AAM OT

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+I NEED NOT. REMIND HONOURABLE MEMBERS OF THIS COUNCE THE ADVERSE EFFECTS AND IMPLICATION OF SUCH PHENOMENA ON THE FUTURE 3 DEVELOPMENT OF OUR ECONOMIC ACTIVITIES.

TORUJE ANT CIA, 29 AM 10ARAO ZVЯ323A 3HT OT ⱭЯAÐзЯ нTIW

THE PROVISION OF PERMITTED RETURN, FEME MIKORĖJ SHOULD380 02056ELY EXAMINED WHEN THE TERMS OF THE AGREBMONESVÆRE JAO I BE JÄEM I EWED ANBOTA YEAR, + HE SAID.

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