On Wednesday's Backchat, we'll talk about competition. The Competition Commission has launched a half-year consultation on enforcing the new Competition Ordinance. Does it have the teeth it needs? After 9.15, ferry fare hike. Call in on 23388266, text at 63935925 or email backchat@rthk.org.hk

Dear Backchat,

The ferry companies complain about not making a profit on ferries to outlying islands.

However, their accounts are opaque. For one thing the companies have subsidiaries that use the same ferries and staff for tourist groups.

The much larger profits from these services is siphoned off and the costs are lumped into the commuter service.

But the major part of expenses is fuel which can be volatile in price. The ferry companies always estimate high on this, and cash in if it comes in lower.
The government should establish a fund to lock in fuel costs over longer periods and use any profits to subsidise fares.

On a more general policy issue, the government has told us many times they cannot subsidise public transport. But all road and rail transport has tens or hundreds of billions in public funds used to provide infrastructure to get around this. Sea transport, without these subsidies, often cannot compete and so is in decline except for islands where there is no alternative. Hong Kong is losing a unique part of its character because of the government's love of throwing money into concrete, roads and bridges.

Alan
Lamma Island