The Chief Executive-in-Council has rejected a toll increase application for the Eastern Harbour Crossing.

The Government said the increase was not approved because it could not be justified on either traffic-management or financial grounds.

In addition, the Government is concerned about whether consumers can afford higher tunnel tolls.

The Government said the company has consistently enjoyed a healthy financial position with all bank loans fully repaid in July 2001. Its cumulative profit up to end 2002 stood at $2.135 billion.

The company started paying dividends from 1994 onwards and total dividends paid up to the end of 2002 amounted to $1.604 billion.

From the traffic management point of view, the tunnel is operating slightly above design capacity during peak hours and at about 80% of capacity the rest of the time.

Noting that there is no undue congestion at its approach roads, the Government said there is no justification either on traffic-management or financial grounds to support the proposed increase.

The Government has urged the company to reconsider the need and timing for any toll increase under the current economic situation.

The Transport Advisory Committee and the Legislative Council Panel on Transport were consulted on the application on April 29, and June 27, respectively. Both raised strong objections.