Passengers to pay USD$180 departure fee for new Hong Kong runway; Legco in cold over funding

Upon its planned completion in 2023, the runway will allow Chek Lap Kok airport to serve 30 million more passengers a year.

The latest budget is set at USD$141.5 billion - but taxpayers are to be spared any expense as funds are to be drawn internally from the authority's surpluses, user charges and external financing via bank loans and bonds.

But the "self-financing" plan will entail the authority's denial of annual dividends to the government - its sole shareholder - and lead to lost public revenues of about USD$50 billion in the next 10 years based on 2014 figures.

Lam did not say if the plan was designed to get round the Finance Committee. Lawmakers' filibustering in recent years has delayed landfill expansion and incinerator projects.

Under the financing plan, departing travellers must fork out an "airport construction fee" of about USD$180. But Lam said: "With Exco recommendations, we will look into whether it is possible to increase internal funding or borrowing further, and reduce the charge on passengers."

Meanwhile, fees for carriers will "go back to their pre-2000 levels", reversing a 15 per cent cut in landing and parking fees - USD$25,790 and USD$2,490 for a Boeing 747 - in place since 2000.

Cathay Pacific welcomed the news, but hinted the authority was "capable of financing the construction … through its own means without the need to impose additional financial burden on users". Dragonair also said the project could be self-funded.

Pan-democratic lawmakers expressed worries over the apparent attempt to bypass Legco. Democratic Party transport policy spokesman Wu Chi-wai accused the authority of playing "financial tricks".

"One should bear in mind the lesson of the cross-border high-speed railway, which was passed in haste and is now witnessing problems during construction," Wu said, referring to a major legal sticking point over a joint immigration checkpoint.

He also said that, by withholding dividends to the government, the authority was in effect using public money to fund the works. Lawmaker Albert Ho Chun-yan, who sits on the authority's board, said he proposed in a board meeting yesterday that the government seek Legco support by tabling a motion, "otherwise the project should not be started".

Analysts expected the authority to face higher costs as the government had warned repeatedly of increases in interest rates. A source at the authority, however, said it had considered this factor. Lam said the authority would "bear all responsibility" for any cost overruns.

Apart from the new runway, other new facilities include 57 parking aprons, a runway concourse and an expansion to Terminal 2. The project will cover 650 hectares of reclaimed land, including the Chinese white dolphin's marine habitat.

Secretary for Transport and Housing Professor Anthony Cheung Bing-leung said the current dual-runway system was fast reaching capacity and that a third airstrip was needed to help maintain the city's competitiveness. "The third runway system is more than a transport infrastructure project. It is essential to keep our economy going."