Will Subway Fares, the 'Common People's Feet,' Also Rise... Deepening Worries

Seoul Subway Lines 1-9 Fare Increase Under Review
Subway Fare May Rise by 300 Won Next Year
End of '8-Year Freeze' Since 2015?

Seoul Subway Line 2 Sindorim Station. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kang Juhee] The Seoul Metropolitan Government is considering raising the base fare for Seoul Subway Lines 1 to 9. The subway fare, which has been frozen for about eight years since 2015, is expected to increase, causing concern among ordinary citizens.

On the 28th, Seoul City is reviewing raising the base subway fare to about 80% of the transportation cost (1,988 KRW). The current base fare is 1,250 KRW. Raising it to 80% of the transportation cost would make it 1,590 KRW. This discussion on subway fare increases follows the exclusion of local government urban railway PSO (Public Service Obligation) budget from the 2023 budget bill passed by the National Assembly plenary session on the 24th.

The government has so far supported the PSO budget only to Korea Railroad Corporation (KORAIL) based on Article 32 of the Railroad Industry Development Act. Some local governments, including Seoul, have requested government support for losses from free rides on subways, but the government decided to continue supporting only KORAIL next year as before. This subway base fare increase in Seoul is the first in eight years since 2015.

Seoul City views that fare increases are inevitable without government support as Seoul Transportation Corporation (STC) is running an annual deficit of about 1 trillion KRW. The corporation recorded a net loss of 1.1137 trillion KRW in 2020 and 964.4 billion KRW in 2021. Seoul Mayor Oh Se-hoon recently said in a media interview, "The subway deficit has become too large. If the government does not help, we have no choice but to consider raising fares."

The main reasons for the corporation's annual deficits are the decrease in passengers due to COVID-19 and the free ride system for seniors aged 65 and over. The senior free ride system was introduced in May 1984 under the directive of then-President Chun Doo-hwan. However, with rapid aging increasing the number of free riders and the COVID-19 pandemic compounding the situation, the corporation's deficits have snowballed over the past two years.

If subway fares increase, other public transportation fares such as city buses are also expected to rise consecutively. Typically, subway and city bus fares have been raised simultaneously. In April 2007, fares increased by 100 KRW; in February 2012, both subway and bus fares increased by 150 KRW; and in June 2015, subway fares rose by 200 KRW and bus fares by 150 KRW respectively.

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