Tuesday, 27 March 2012

MTR Fare Hike Rant

The prices of goods and services keep going up in Hong Kong. Rents and the prices of food keep rising and now it's the transportation sector that wants more money from our wallets.

Taxi operators have applied to raise the flagfall price to HK$23 from HK$20, citing rising fuel costs, and bus companies like Kowloon Motor Bus is also aiming to raise fares too.

And now MTR Corp wants us to pay more for each ride.

There are plans to raise fares 5.4 percent in June, the third and largest increase since a fare-adjustment formula was implemented in 2007.

This means an average increase of HK$0.37 per trip. As expected, community groups were outraged.

Lawmaker Andrew Cheng Kar-foo said, "The increase will create a great burden for passengers and any concession is unlikely to be enough."

The groups noted the adjustment formula was supposed to allow for fare increases during times of inflation, but also fare reductions when there is a recession. However so far there have only been increases, even though the MTR Corp saw profits surge 22 percent to HK$14.7 billion last year.

The company justifies the need to raise fares to maintain its service standards. "Every year, we invest an average of HK$4 billion to repair and upgrade the system, not to mention the various concession packages we offer to passengers, students and the disabled. We need a stable increase in revenue to support the move," said Jeny Yeung Mei-chun, MTR's general manager of marketing.

No wonder the company is running television commercials showing an MTR technician who explains how he and his colleagues work hard overnight to ensure all the trains are in working order and are safe for use the following day.

MTR Corp offered HK$1.7 billion in fare concessions last year when the fare rose 2.2 percent. Yeung said the company was considering a bigger fare concession package this year.

First off, the company made a massive profit last year. It not only runs an efficient transportation network in Hong Kong, but also manages subway lines in Beijing, Shenzhen, London, Stockholm and Melbourne.

It also invests in a number of property developments like the one in Tsing Yi and Kowloon station, as well as shopping malls like Maritime Square, Telford Plaza, The Lane and Paradise Mall.

How can the MTR not have enough money to cushion itself this year or at least keep the fare raise as low as possible?

Which is why I prefer taking the bus, tram or walking to avoid being gouged as much as possible.

Yes, the MTR is the most efficient way of getting around Hong Kong -- there's no doubt about that.

But when it reaches a threshold people cannot afford or are not willing to pay -- then there's a problem.

Perhaps the only solution is to be a shareholder -- the only people the company will listen to.

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