15th May 2024 – (Hong Kong) The Chief Executive in Council has once again approved a series of fare increases for Hong Kong’s public transportation, including a notable rise in taxi flagfall charges. Effective from 14th July, urban taxis will see their starting fares increase from HK$27 to HK$29, with incremental rises also affecting journeys over the first 2 kilometres. Similar hikes are set for New Territories and Lantau taxis, marking a consistent upward trend in transportation costs that has persisted despite economic stagnation and public disquiet.

This decision is part of a broader pattern whereby public transport operators, from MTR to buses and ferries, regularly seek and receive approval for fare increases. Each application is met with a seemingly automatic green light from a government more aligned with business interests than with the daily struggles of ordinary citizens. The recurrent hikes, averaging between 8.86% and 10.92%  for urban, NT and Lantau taxis respectively, are not just numbers; they translate into a tangible burden on the working-class residents of Hong Kong, for whom public transport is not a choice but a necessity.

The government’s stance, as articulated, considers factors such as public acceptance and the operational costs of taxi services, aiming to balance financial viability with public sentiment. However, this rationale falls short of acknowledging the cumulative impact of consistent fare increases on a population still reeling from the economic impacts of the pandemic. Many residents face stagnant wages and job insecurity, yet are expected to shoulder the burden of escalating costs in essential services.

The taxi industry’s justification for the fare increase is twofold: to boost the income of drivers and to improve service quality. However, this comes against a backdrop of growing dissatisfaction with the quality of taxi services. Complaints range from the rudeness of drivers to issues of overcharging and poor vehicle maintenance. The rise of ride-sharing services, which often offer cleaner vehicles and competitive pricing, underscores a shift in consumer preference driven by quality, not just cost.

Moreover, the argument that increased fares will enhance service quality and attract new drivers overlooks the essential issue: service improvement initiatives must precede price hikes, not follow them. Consumers are unlikely to support higher costs without tangible improvements in service. The industry’s reluctance to self-regulate and enhance service standards, instead of calling for government crackdowns on ride-sharing platforms, reveals a resistance to change that could ultimately alienate its customer base.

The government’s role in this cycle appears to be one of facilitation rather than regulation. By routinely approving fare increases without stringent service quality demands, it risks becoming perceived as a spokesperson for transport operators rather than a guardian of public interests. This perception is exacerbated by the government’s handling of other public utilities, where profit motives seem to override public service obligations.

The broader economic implications of these fare hikes are significant. They contribute to a general increase in the cost of living, affecting not only direct users but also the wider economy. As transport costs rise, so do the prices of goods and services, adding inflationary pressure in an already challenging economic environment.

While the need to maintain financially viable public transport services is understood, the government must prioritise the economic welfare of its citizens. This involves a more balanced approach to fare adjustments—one that considers the broader economic context and insists on service quality improvements as a precondition for price increases. Only through such measures can the government hope to foster a public transport system that is both economically sustainable and aligned with the needs and expectations of the Hong Kong public. In doing so, it must move beyond mere facilitation of industry demands to a more proactive role in safeguarding the interests of the very people it serves.