Free Subway Rides for Seniors Under Threat Amidst Budget Concerns

SEOUL, Dec. 7 (Korea Bizwire) – South Korea’s decades-long free subway ride policy for elderly passengers is being met with calls for a higher age threshold, with local public transport operators seeking ways to offset the growing losses.

Since its implementation during the 1980s under the Chun Doo-hwan government, the free subway ride policy has been hailed as a role model for social welfare services for the elderly.

However, public sentiment is changing in the face of growing reports that most of Seoul Metro’s deficit is caused by elderly passengers, and calls are growing for the government to reconsider the policy, with some suggesting that the qualifying age should be raised from the current 65.

Last year Seoul Metro, which operates most of the lines of the Seoul Metropolitan Subway connecting Seoul and the surrounding area, posted a deficit of 288.7 billion won as a direct result of non-paying elderly passengers, who accounted for 73.7 percent of the total loss.

The figure has been growing steadily since 2010, when the public corporation’s deficit due to elderly passengers stood at 169.2 billion won.

The aging population of the country is exacerbating the financial situation of subway operators, particularly in Seoul where the average age reached 41.1 years last year, according to data from Seoul Statistics.

“Given the aging population, losses resulting from elderly passengers will continue to increase. If the financial situation worsens and operators can’t improve and replace old facilities, there will be an increased risk of safety accidents,” said the Seoul Metropolitan Government, which owns Seoul Metro.

Amid growing pressure from local governments, an amendment to the Passenger Transport Business Act was passed by the Land Infrastructure and Transport Committee in September, allowing the central government to compensate subway operators for operating losses caused by elderly passengers travelling for free.

When the final bill is passed by the National Assembly later this year, the new amendment is expected to alleviate the financial burden on city governments that operate subway systems, including Seoul, Busan, Incheon, and Daegu.

It’s the first time a move to share the responsibility of free rides for the elderly with the central government has reached the floor of the standing committee, after years of an unwavering stance that operating losses due to elderly passengers were the sole responsibility of municipal governments.

While the Seoul Metropolitan Government is urging lawmakers to go forward with the move, others are calling for an increase to the qualifying age, given the social climate.

At a parliamentary inspection meeting held in October, Finance Minister Kim Dong-yeon hinted at the possibility of considering a higher age limit for free subway rides, or excluding rush hour from the controversial policy, in an effort to deal with the issue of operating losses for public transport systems.

Last month, the Seoul Metropolitan Government held a public forum marking the 33rd anniversary of the free ride policy for the elderly, during which members of the public discussed the sustainability of the controversial policy that caused a nationwide operating loss of 554.3 billion won last year, as well as possible alternative approaches.

Supporters of the policy, however, argue that the free ride service needs to be looked at as a form of elderly social welfare.

According to a joint study conducted by the Korea Transport Institute and professor of transportation systems engineering Yu Jung-hoon at Ajou University, the free subway ride policy helps to reduce depression, road accidents and suicide among the elderly by encouraging seniors to engage in social activities. 

Hyunsu Yim (hyunsu@koreabizwire.com)