Untitled - Civic Exchange

Chapter 3:
Road versus Rail - Financing Mass Transit in Hong Kong
consultants are allowed to publish tends to be skewed in such a way as to largely pre-determine the
conclusions. The results are then put out by the Transport Department as definitive, when in fact, important
factors or alternatives have not even been considered.
Although there are plans for a major expansion of the HKSAR's passenger rail system, it is
noteworthy that the Transport Bureau proposes to do this without changing the manner in which
railways in Hong Kong are financed. Continuation of current transport financing policy seems likely,
despite the fact that the rail self-financing policy causes high external costs (less mobility, more pollution
and noise) for everyone in Hong Kong.
Passenger journeys
The adverse effects of the requirement that rail systems be largely self-financing are demonstrated by the
absence of rail in a number of Hong Kong's major population centers. Urban areas housing hundreds of
thousands of people and lying only a few kilometers from an existing rail line may remain unconnected to
rail for many years. For example, in what other "world city" would communities like Ap Lei Chau/Wah Fu
or Ma Tau Wai remain without rail service, despite serious congestion and air pollution It seems unlikely
that this situation would occur in the service areas of other urban systems covered in the rail study.
Due to differences in government support for different transport modes, more travelers use road transport
than would otherwise be the case. Overall, somewhat more than two journeys on road occur for each
journey by rail. This reliance on road transport is not good from the standpoint of mobility or the
environment. The fact that one-third of all journeys occur by rail may appear impressive, but Hong Kong's
high density and income levels make the potential for rail-based transit here the highest in the world. Yet
among the 15 systems surveyed, Hong Kong barely made the upper third of those surveyed with respect to
the role of rail transport relative to road transport. Logically, we should be number one.
Our point here is not that buses should lose their cross-subsidy but that current government policies do
provide financial support for some transport modes, with the result that the overall external costs to the
Hong Kong community are higher than they would be otherwise. Buses provide essential external benefits
compared to other forms of road-based transport, such as taxis and private vehicles, and have a crucial role
to play in a more sustainable transport system for Hong Kong. Nonetheless, buses are more energyintensive
and polluting than rail and should play a complementary role to rail transport. Moreover,
government claims that current transport policies reflect a laissez faire and impartial financing system are
simply untrue. Current policies do provide de facto subsides for certain modes of transport.
The way in which particular transport modes are financed has a profound effect on the quality of life for
everyone. This occurs directly through the level of fares and accessibility to transport and indirectly
through the external impacts of modal choice. And in dense urban areas, the external effects of modal
choice intrude on our lives around the clock. We urge that the same logic that is applied in providing
indirect financial support for bus transport should be applied to rail - i.e., support in covering the costs of
basic infrastructure provision. This should be accompanied by a concerted effort to promote substantial
bus-rail coordination.
The survey of urban rail systems mentioned here suggests alternative models for financing rail transport. For
example, what would be the external economic, mobility, and environmental benefits for Hong Kong if:
• The government followed the model applied in other cities around the world and funded -
through direct grants - a substantial portion (e.g., 60%-70%) of the cost of new passenger
railway construction
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