Panel on Transport (Papers) 25 Sep 98

Legislative Council Panel on Transport

Review of the Transport Advisory Committee

Introduction

We have undertaken to the Provisional Legislative Council to review the membership and terms of reference of the Transport Advisory Committee (TAC) with a view to strengthening its monitoring role. On another occasion, we undertook to conduct a review of the monitoring mechanism for the railway corporations to strengthen the existing mechanisms, including the role played by the TAC. This paper sets out the outcome of our review.

Transport Advisory Committee (TAC)

2. Established in 1965, the TAC is the key advisory body to the Administration on transport matters.

Membership

3. At present, the TAC comprises a non-official Chairman and 13 non-official members, both of whom are appointed on an ad personam basis. The Secretary for Transport, Commissioner for Transport and a representative of the Commissioner of Police also sit on the Committee. Non-official members of the TAC have different background and are expected to render impartial and objective advice to the Administration while maintaining a balance among the interests of transport operators, the travelling public and the community at large.

4. The Administration reviews the membership of the TAC from time to time vis-a-vis its work and changing community aspirations and appoint additional members as and when necessary. To strengthen the membership, we have appointed six new members from different walks of life to the Committee since 1997. The addition of new members further widens the expertise and advice offered by the Committee.

5. Our present system allows the TAC to play a monitoring and an advisory role which is apolitical and impartial. In recent years, it has been the Administration's practice to obtain feedbacks from the TAC as well as Transport Panel of the Legislative Council (LegCo) before proceeding with any major transport proposals.

6. Notwithstanding the fact that the TAC does not have any executive functions, a Transport Complaints Unit (TCU) has been set up under the TAC since 1980 to receive and monitor complaints and suggestions on traffic and transport matters. The work of the TCU is monitored by the TCU Subcommittee established under the TAC. Quarterly and annual reports on the complaints and suggestions received by the TCU are published.

7. To increase the transparency of the operation and deliberation of the TAC, it has been the practice for the TAC Chairman to meet the media after each TAC meeting to brief them on the views and deliberation of the Committee on individual agenda items. A press release is also issued after each meeting.

Terms of Reference

8. In accordance with its terms of reference (Annex A), the TAC advises the Chief Executive in Council on major transport matters including fare and toll revision. It has a wide ambit. It is our view that the current terms of reference are appropriate and there is no need to propose any change.

Railway Matters

Railway Fares

9. Both railway corporations are empowered by their respective ordinance to determine fares. It has been the policy of the two railway corporations to review their fares annually have regard to operating costs, long-term financial requirements and public acceptability.

10. We have reviewed the mechanism for railway fare determination. Although not required by law, the two corporations have taken steps in recent years to increase public consultation and the transparency of the fare determination process. They have adopted a practice of consulting with the TAC, briefing the Transport Panel of LegCo and informing the Executive Council of their fare proposals before they formalise the fare levels. In presenting their proposals to the TAC and the Transport Panel of LegCo, the corporations present the basis for their fare proposals, and take full account of the views expressed by these two bodies, as well as other interested parties, and modify their proposals before they make their final decision on fares. For example, in the 1997 MTR and KCR fare revision exercise, the corporations took into account the views expressed by the TAC and modified their fare revision proposals. In 1998, the MTRC consulted the LegCo Transport Panel and TAC and modified their original proposals before deciding on the final fare structure for the Airport Express Line and Tung Chung Line.

11. During the review process, both corporations have expressed strong views that the existing fare revision mechanism must be retained to enable them to convince lenders of their ability to achieve the projected revenue levels so that they can service their debts. This ability to borrow on sound financial projections is most important for the implementation of new railway projects. For example, the three priority railway projects cost over $100 billion and the two corporations have undertaken to fund a significant portion of this from commercial borrowing. Fund raising is already difficult against the backdrop of the current economic climate. We do not propose to make it even more difficult by proposing any change to the fare determination system of the corporations. However, we see considerable merit in enhancing the transparency of the present procedures. We can instill a degree of accountability of the two corporations to the general public on their fare setting mechanism by codifying the current practice.

12. The TAC has been consulted on revision of railway fares in recent years, but has not been too involved in discussing other aspects of railway matters such as railway services and operations. As railway services continue to expand and patronage continues to grow, railways will play an increasingly important role in our public transport system. We propose that the TAC should play a bigger part in the monitoring and discussion of various aspects of railway services and operations.

Railway Services and Operations

13. The two corporations already have in place some performance pledges and various mechanisms for customer participation in monitoring of performance like establishment of passenger liaison groups. We consider that the two railway corporations should further enhance their transparency and accountability to their customers by keeping under regular initiatives to enhance transparency and accountability. The expansion of their performance pledges will not only enhance transparency but will assist the regular monitoring of their service standards by the customer groups, TAC and Government Departments.

Planning and Coordination of Railway Projects

14. Planning of railway projects has always been spearheaded by the Government. The Second Railway Development Study (RDS-2) aims to determine the next generation of comprehensive railway network which will meet Hong Kong's needs up to 2016. In this connection, the two corporations participate in the process by providing the study team with their railway development and operation experience and their individual preferred projects and alignments. Within Government, we have taken steps to increase the capability of the departments which are involved in the planning and implementation of railway development projects so that we can enhance our engineering and policy input into the determination of the alignments and priority of the selected projects. We will also step up our planning and co-ordination of railway development projects in order to achieve a comprehensive network of rail services which will integrate with other public transport services to provide convenient interchange arrangements. The LegCo Transport Panel and TAC will of course be involved in the consultation process.

Transport Bureau
22 September 1998

Annex A

TRANSPORT ADVISORY COMMITTEE

Terms of Reference

To advise the Chief Executive in Council on transport matters in accordance with the principles set out in the guidance note.

Guidance Note

1. The Transport Advisory Committee (TAC)'s function is to advise the Chief Executive in Council on broad issues of transport policy with a view to improving the movement of both people and freight.

2. The consideration of transport and traffic proposals and policy in detail is the responsibility of the Standing Conferences on Road Use and on Waterborne Transport. These conferences will function within the framework of agreed Government policy.

3. On any matter within its terms of reference, the TAC is free to communicate with members of the public and with any organisation.

4. The TAC may consider financial matters where they directly relate to transport, but it should be borne in mind that responsibility for proposing public expenditure and taxation lies solely with the Administration.

5. The Secretary for Transport will provide a secretariat for the TAC and will be responsible for administration in connection with it.

6. The TAC will be free to form sub-committees, to participate in joint-committees with other bodies, and to co-opt members for specific purposes. It may organise its work in whatever manner it considers most suitable.

7. The Chief Secretary for Administration may, after consultation with the TAC and the Chief Executive in Council, amend the terms of reference and this guidance note from time to time.