The Environment, Transport & Works Bureau wants to finish merger discussions on the Kowloon-Canton and Mass Transit Railway Corporations as soon as possible.

In a Legislative Council paper today, the bureau said a final consensus on the merger has yet to be reached, noting the terms will need to strike a balance between the interests of different stakeholders, including the travelling public, staff, taxpayers and the MTRC's minority shareholders.

As the talk involves commercially sensitive information relating to the railways' operation, the bureau will only report to LegCo the deliberation of the Government on the way forward in detail once the merger outcome has been reached.

Due to the complexity and wide implications of a merger, it is impossible to set an implementation timetable at this stage, it said.

The bureau has studied a joint report submitted by the two corporations on the feasibility of a rail merger in September 2004, and discussions with them are on-going.

5 parameters

Regarding the negotiation with the MTRC on terms for the possible merger, the bureau said discussions have been based around the following key parameters:

* adoption of a more objective and transparent fare-adjustment mechanism;

* abolition of the second boarding charge and review of the fare structure to cut fares;

* early resolution of interchange arrangements for new rail projects under planning, notably the Sha Tin-Central Link;

* ensuring job security for frontline staff at the time of the merger; and,

* the provision of seamless interchange arrangements in the long run.

The bureau said if a decision is made to proceed with the merger, legislative amendments will be required to provide the legal framework for the operation of a combined railway network, and approval of the merger proposal by the minority shareholders of the MTRC will also be required.