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Following is a question by the Hon David Li and a written reply by the Secretary for Transport and Housing, Ms Eva Cheng, at the Legislative Council meeting today (June 17):
Question:
The Government has adopted various incentive schemes to encourage owners of pre-Euro and Euro I diesel commercial vehicles to replace their vehicles with newer models which are more environment-friendly. However, some members of the public have relayed to me that with respect to the provision of residents' bus services, government policy explicitly favours the retention of older vehicles by facilitating applications by operators that source buses from the existing non-franchised bus ("NFB") fleet. For example, in the notes to application for Passenger Service Licence - Public Bus Service (Residents' Service), it is stated in paragraph (E)(5) that "If the vehicle for which an application for service endorsement is made is sourced from the existing registered NFB fleet and the application will not entail a net increase in the NFB fleet size, a more flexible approach will be adopted by Transport Department in the granting and/or amendment of endorsements". In this connection, will the Government inform this Council:
(a) of the total number of vehicles in the existing NFB fleet, with a breakdown by the emission standard which they meet; their average age and, among these vehicles, the number of those which were manufactured five years or more ago;
(b) whether it has assessed if the aforesaid government policy has artificially resulted in high prices of second-hand NFB; if the assessment outcome is in the affirmative, of the respective average amounts of the pricing distortion in 2006, 2007 and 2008, and whether it has assessed if the aforesaid government policy or pricing distortion has created any disincentive regarding or impediment to the replacement of pre-Euro and Euro I diesel commercial vehicles, which the Government hopes to accelerate; and
(c) whether the Government will consider adjusting the aforesaid policy to align it more closely with its policy to encourage owners of pre-Euro and Euro I diesel commercial vehicles to replace their vehicles with more environment-friendly newer models; if not, of the reasons for that?
Reply:
President,
(a) As of end May 2009, there were 7,069 registered public non-franchised buses (NFBs), with an average age of 6.8 years. Among them, 4,651 vehicles were aged 5 years or above. The break down by emission standard is as follows:
Emission Standard Number of vehicles
Euro V 14
Euro IV 1,449
Euro III 2,717
Euro II 2,121
Euro I 476
Pre-Euro 292
Total 7,069
(b) & (c) In recent years, the number of NFBs increased rapidly, while the growth in public transport patronage during the same period was relatively slow. The NFB and other transport trades have expressed grave concerns about the oversupply of NFBs. In this connection, the Government invited the Transport Advisory Committee (TAC) in 2003 to conduct a review on the regulatory framework and licensing system of NFB operation. TAC released its report in 2004. On the basis of the recommendations in the report, the Administration formulated the existing regulatory framework for NFB operation. This included adjusting supply of NFB services in line with demand and encouraging applicants who wish to operate new NFB services to source buses retiring from the existing NFB fleet in the market instead of purchasing new vehicles to avoid a net increase in the NFB fleet size.
Since the Government implemented the above measure in April 2005 based on TAC's recommendations, the Transport Department (TD) recorded 2,118 transactions of second-hand NFBs as of May 2009. The total number of registered NFBs decreased from 7,212 at the end of 2004 to 7,069 at the end of May 2009. TD considers the measure effective in alleviating the problem of oversupply of NFBs.
Prices of second-hand NFBs are adjusted automatically through the market mechanism and are affected by various factors, such as the supply of vehicles, the age of vehicles and the number of seats, etc. The abovementioned measure should not have caused any imbalance between supply and demand in the vehicle market.
Meanwhile, the Environment Bureau launched a scheme on April 1, 2007 to encourage owners of pre-Euro and Euro I diesel commercial vehicles to replace their vehicles with Euro IV standard by providing one-off subsidies. As of end May 2009, subsidies for the replacement of 814 NFBs were approved under the scheme, constituting 35% and 50% of eligible pre-Euro and Euro I NFBs respectively. These percentages were higher than those of other eligible pre-Euro and Euro I diesel commercial vehicles, which were 20% and 15% respectively.
As the measure implemented by the Government is effective in alleviating the problem of oversupply of NFBs, we have no plan to change the measure at the present stage.
Ends/Wednesday, June 17, 2009
Issued at HKT 12:16
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