The Chief Executive in Council today endorsed Hong Kong Tramways' application for fare increases that will take effect on July 2.

Consent was given in accordance with section 51 of the Tramway Ordinance.

The adult fare will rise by 30 cents to $2.60, while that for children and the elderly will rise by 10 cents to $1.30 and $1.20.

The monthly ticket will rise from $200 to $220, while the tourist ticket will remain at $34.

The Transport & Housing Bureau said the application was assessed in accordance with the established policy and mechanism, taking into account service quality and improvement plans, changes in operating costs and revenue, its forecasts of future costs, revenue, profit and return, and public acceptability.

The bureau said Hong Kong Tramways has been providing satisfactory services for many years and noted it will implement new projects in the coming years to maintain the service's competitiveness and sustainability.

The 12.6% weighted average fare increase proposed by the company was lower than the changes in the Composite Consumer Price Index at 21.5% and Median Monthly Household Income at 39.3% since its last fare increase.

As tram fares only have a 0.01% weighting in the CPI Index, the inflationary impact of the fare increase will be insignificant, the bureau added.