LegCo Paper No. CB(1) 586/96-97

(These minutes have been seen by the Administration)
Ref : CB1/PS/8/95/1

LegCo Panel on Transport
Subcommittee on Western Corridor Railway Project

Minutes of the Meeting on
Friday, 28 June 1996 at 8:30 a.m.
in the Chamber of the Legislative Council Building

Members present :

    Hon Mrs Miriam LAU Kin-yee, OBE, JP(Chairman)
    Hon Mrs Selina CHOW, OBE, JP
    Hon Edward S T HO, OBE, JP
    Hon Albert CHAN Wai-yip
    Hon LEE Wing-tat
    Hon Zachary WONG Wai-yin
    Hon CHAN Wing-chan
    Hon Albert HO Chun-yan
    Hon NGAN Kam-chuen
    Hon SIN Chung-kai

Members attending:

    Hon Eric LI Ka-cheung, OBE, JP
    Dr Hon Samuel WONG Ping-wai, MBE, FEng, JP
    Hon CHAN Kam-lam
    Hon IP Kwok-him
    Hon Ambrose LAU Hon-chuen, JP

Members absent :

    Hon CHEUNG Hon-chung
    Dr Hon LAW Cheung-kwok
    Hon LEE Kai-ming
    Hon TSANG Kin-shing
    Hon Lawrence YUM Sin-ling

Public officers attending :

Mr Gordon SIU, JP
Secretary for Transport
Mr Paul LEUNG, JP
Deputy Secretary for Transport
Mrs Jenny Wallis
Principal Assistant Secretary for Transport
Mr L N Parker
Government Engineer/Railway Development
Highways Department
Mr George LAI
Acting Assistant Commissioner/Technical Services & Planning, Transport Department

Attendance by invitation :

From Kowloon-Canton Railway Corporation
Mr Ian McPherson
Director, West Rail
Mr Samuel LAI
Director, East Rail
Mr Jonathan YU
Director, Light Rail

From A T Kearney (Hong Kong) Ltd
Mr Robert Tasiaux
Vice President, Great China

From MVA Asia (Transportation, Planning and Management Consultant)
Mr Martin Read
Regional Director

Clerk in attendance:

    Mrs Vivian KAM

Staff in attendance :

Mr Billy TAM
Senior Assistant Secretary (1)4

I Matters Arising from the Previous Meeting

The Chairman reported that :

  1. documents relating to the Railway Development Study were circulated to members on 24 June 1996 vide LegCo paper No. CB(1) 1677/95-96;
  2. Volume 2 of the Kowloon-Canton Railway Corporation (KCRC)’s proposals on Transportation Planning, had been circulated on 25 June 1996 vide LegCo Paper No. CB(1) 1680/95-96; and
  3. other volumes of KCRC’s proposal would be forwarded to members shortly.

2. The Chairman welcomed Mr Gordon SIU to the meeting in his capacity as the Secretary for Transport.

3. Mr Ian McPherson of KCRC apologised that Mr Kevin Hyde, the KCRC Chairman and Chief Executive, could not attend the meeting. He also advised that KCRC was working on the Chinese translation of the full KCRC proposal. In response to the Chairman on outstanding replies to concerns raised by members at the meeting on 21 June 1996, Mr SIU undertook to provide the written responses before the next Subcommittee meeting.

II Transportation Planning for the Western Corridor Railway

Presentation

4. At the invitation of the Chairman, Mr McPherson introduced KCRC’s consultants to members. With the aid of slides, Mr Martin Reed of MVA Asia and Mr Robert Tasiaux of A.T. Kearney (Hong Kong) Ltd. explained, on the basis of presentation materials tabled at the meeting, the methodology and assumptions used in domestic passenger forecasts, cross-border and through-train passenger forecasts, as well as freight forecasts. Mr McPherson summed up the presentation by emphasizing that the KCRC study was handled by experts in the transportation field and the transportation forecasts were both robust and conservative.

(Post-meeting note: The presentation material was circulated to absent members vide LegCo paper No. CB(1) 1721/95-96 dated 28 June 1996.)

Discussions

Passenger Service

5. In response to a member on the microeconomic analysis of the passenger demand and on the passenger demand figures for sub-regions in the year 2001, Mr Read agreed that the presentation concentrated on the macro aspects of transportation planning. He advised that the domestic transportation model covered different alternatives of transportation means and made comparisons on fares and journey times among the various options; the model had split Hong Kong into about 400 zones territory-wide. At members’ request, Mr Gordon SIU undertook to provide typical examples of passenger demand forecasts for sub-regions in different years for illustration purposes. He added that past studies and experience relating to the East Rail would also be incorporated for members’ reference.

6. A member noted that comparisons were made between travelling on WCR and along Tuen Mun Road, and enquired if comparison had also been made for travelling on Route 3. Mr Read clarified that the consultants’ study had already taken into account the shorter travelling time on Route 3. He emphasized that traffic on Tuen Mun Road was not static and was dependent on traffic demand at a particular time. In response to a request for more data on travelling times, he re-iterated that there were a significant number of combinations in the model but agreed to provide journey times between typical areas between the New Territories and urban areas via different roads. He also undertook to provide comparisons of journeys between selected typical destinations via the WCR, Route 3 and Tuen Mun Road respectively.

7. Noting that a 15% fare increase would only lead to a decline of 10% in patronage, a member asked if this implied that demand would be inelastic as transportation choices were limited for residents in north-western New Territories. Mr Read pointed out that a fare increase might not result in corresponding reduction in patronage. He explained that the findings were derived from models which had been well tried and tested, and the trend observed was not unusual in Hong Kong. Similar results were obtained using the same models when Mass Transit Railway fares were increased. Mr George LAI supplemented that sensitivity tests conducted on the East Rail showed that a mild increase in fares could cause the revenue to increase. The member observed that the East Rail was making profits and was worried that when WCR suffered a loss, there might be a greater need for WCR to increase its fare.

8. A member was concerned about the design of the connecting stations, and enquired if the Mei Foo WCR Station and the Mei Foo Mass Transit Railway Station would be on the same level in order to minimize walking time between platforms. He also suggested the use of conveyance belts along the platforms. Mr Read clarified that travelling time between platforms quoted in the proposal was for walking from one platform to another, including time spent on escalators. Mr McPherson undertook to take into consideration the members’ suggestion. He highlighted the fact that direct transfer would be possible at the interchange at Yen Chow Street Station as the facilities were within one combined building.

9. At members’ request, Mr McPherson undertook to provide:

  1. breakdowns of the estimated passenger numbers in the years 2001, 2006 and 2011 by regions and districts and by frequent and infrequent commuters, with further sub-groupings into residents and non-residents of the regions/districts; and
  2. the ratio of WCR passengers to the total number of passengers using public transport.

.

Freight Transport

10. In response to a member on whether development of the port in Gaolan in Southern China had been taken into account in the study, Mr Tasiaux indicated that the port in question served the western part of the Pearl River Delta and west Guangdong Province. As Guangdong Province was not part of WCR’s target market, no impact on WCR was expected. The member held the view that a review of the proposal by the consultants was necessary as the port development in Gaolan would be a comprehensive development programme in China and should not have been ignored in the consultants’ study.

11. A member considered the assumptions on the Proposed System Configuration in paragraph 2.2 on page 2-4 of Volume 2 of the full proposal too optimistic. He was worried about the negative impact which inaccurate forecasts would have on passenger service as profits from freight transport constituted a substantial component in the profit forecast. He was also uncertain about co-operation from China for interfacing arrangements for freight transportation from China to the Port Rail Terminal via the Northern Freight Yard (NFY). In response, Mr Tasiaux explained that the 1.1 million Twenty-foot Equivalent Unit (TEU) capacity was based on an assumption made in 1993 when proposals for WCR were first drawn up. Since then, engineering constraints at the Port Rail Terminal to be built at Kwai Chung had improved, and WCR could now serve the demand at an increased capacity. Mr SIU added that the Government was also looking at this issue and would formulate a view in due course.

12. A member considered that there should be simplified cross-border formalities after the transfer of sovereignty and as such it might be cheaper to set up the NFY in China. Mr SIU advised that this had been considered by the Port Development Authority. Since Hong Kong would still be a special customs clearance port, the NFY could not be located in China.

13. Commenting on the substantial proportion of freight income, a member expressed worry over the possibility for passenger service to subsidize freight service. He enquired about means available for attracting goods owners to use the WCR freight service. Mr McPherson advised that on the contrary, freight service would normally subsidize passenger service. He said that freight revenue would be 22% of the total revenue in 2006 and 34% in 2011. Mr Tasiaux emphasized that the results of their study had been conservative. The cost for moving goods by truck was high, especially when traffic was congestion at the border, and a conservative view was that the WCR freight service was competitive price-wise. In response to the Chairman, Mr Tasiaux confirmed that for transportation from Shenzhen to Hong Kong, rail transport was cheaper than truck.

14. At members’ request, representatives from KCRC and the consultancy firms undertook to:

  1. rewrite Section 2 (Freight System) of Volume 2 of the proposal, in particular paragraph 2.2; and
  2. provide a tabulation of the data relating to the eight transportation performance options in Attachment A on pages 5-10 and 5-11 in Section 5 of Volume 2 of the proposal for comparison purpose.

Market Share

15. On members’ request for details of the assumptions regarding fare comparison between WCR and other modes of transport in calculating the market share figures, Mr Read advised that an exact comparison between East Rail and WCR was not possible as East Rail was much slower. He considered that passengers would make trade-offs between time and costs, and would be willing to pay higher fares for faster service. In response to the Chairman, Mr Read confirmed that WCR fares were taken to be 30% higher in the year 2001 but emphasized that the difference would diminish over time as bus fares had increased faster than rail fares historically.

16. A member sought confirmation on the years shown in the slide on "Comparison of Market Share". Mr Read confirmed that the year should "2011" instead of "2001". For market share figures in the year 2001, Mr Read undertook to provide this in writing. As regards the methodology used in producing the optimistic market share of 55%, Mr Read advised that the output of the model was the sum of thousands of mathematical calculations within a grid-table size of 400 by 400.

Fare Structure/Fare Model

17. As regards the WCR fare structure, Mr McPherson re-iterated that this had yet to be determined. Mr SIU undertook to produce relevant data for members’ reference after consulting KCRC and their consultants. As far as the fare model was concerned, Mr Read affirmed that this was a simple distance-based model.

18. A member pointed out that the fare forecast comparison had assumed that there was no direct bus service on Route 3. He noted also that expensive air-conditioned bus services had been used for comparison. Mr Read explained that it was not a one-fare model and that the choice of air-conditioned buses was realistic since at the time when WCR become operational, most bus services were expected to be air-conditioned. A member however cast doubt on whether it would be Government’s policy to allow bus companies to phase out non-air-conditioned buses in the coming years. Members also requested the Administration to advise in due course whether fare structures for WCR journeys through tunnels would be more expensive than those above grounds as was the experience with the Mass Transit Railway cross-harbour tunnel journeys.

Transportation Planning

19. Noting that the proposed alignment overlapped with the route of the Light Rail Transit (LRT), a member asked if another alignment along the sea had been considered. Mr L N Parker said in response that this had been considered in the Railway Development Study but had been dropped owing to the expensive cost for construction, the rocky slopes along the alignment and the forecast need for railway service in the Tin Shiu Wai area.

20. In response to a member on the validity of the forecast data in the event of the delay in completion date of the WCR project and the reasons for not having noted the delay in land resumption when the consultants compiled the report, Mr McPherson advised that KCRC’s original plan was to resume land and construct the railway in stages. As regards the forecast, he pointed out that this covered a long period and any delay in completion of the project would mean an increase in population and a higher demand for WCR services.

21. A member doubted if the economic development in the western part of the New Territories would be affected by the future development of nearby areas like Shenzhen and Zhuhai, where a number of cross-border infrastructure projects were in the pipeline. He was concerned that residents might go north to China instead of south to Kowloon, and was of the view that the WCR proposal should have regard to the impact of such massive cross-border infrastructural developments. In response, Mr Read advised that their study was based on data provided by the Administration in the Territorial Strategy Review, and there were two scenarios with different mixes of population and employment. The consultants had run sensitivity tests based on the lower forecast and discovered that rail traffic flow tended to be higher with the higher forecast data. As regards additional employment opportunities in specific areas, different measures would be required to encourage people to work in these areas. Mr SIU confirmed that the consultants’ study was an appropriate and cautious estimate based on internal forecasts made by the Administration. As decisions on bridges and railways connecting west Shenzhen and areas in the Pearl River Delta had yet to be made, the study had not included these projects. Even when these infrastructure projects materialized, the pressure on traffic in north-west New Territories would only become greater instead of being reduced.

Any Other Business

22. Members agreed that the next meeting on 4 July 1996 would be for discussion of the subjects of Detailed Engineering Report and Transportation Planning.

23. There being no further business, the meeting ended at 10:50 a.m.

Legislative Council Secretariat
30 December 1996

Last Updated on 21 Aug, 1998