Seoul subway fare hikes became inevitable as the free transportation loss support for urban railways was not reflected in next year's government budget.

According to the Seoul Metropolitan Government, in the government budget for next year, which passed the plenary session of the National Assembly yesterday (24th), the local government urban railway PSO, that is, the budget to compensate for losses due to public services, was eventually excluded.

The PSO budget is set aside to compensate for the cost of free transportation for the elderly and the disabled.

The government has supported PSO budget only for KORAIL based on Article 32 of the Framework Act on Railroad Industry Development.

Last year, we supported 379.6 billion won, and this year, 384.5 billion won.

A budget bill of 397.9 billion won was submitted to the National Assembly for next year, but the Land, Infrastructure and Transport Committee of the National Assembly additionally reflected 358.5 billion won in compensation for losses in urban railways by local governments on the 24th of last month, resulting in a total of 756.4 billion won. The amendment was passed.

At the plenary session, however, the government's original bill, which reflected only KORAIL's loss compensation, was passed, not the transportation committee's amendment.

As the free transportation budget was finally canceled, it seems that the Seoul Metropolitan Government will start to 'prepare self-rescue measures' recently mentioned by Mayor Se-hoon Oh.

The basic subway fare in Seoul has remained the same for eight years after being raised from 1,050 won to 1,250 won in 2015.

Considering that it has been raised along with bus fares every 3 to 4 years, it is well past the point of adjustment.

In addition, as the number of free transportation increases every year due to the aging population, the average fare per person is less than half of the cost, and the loss per person soared from 494 won in 2019 to 1,015 won last year.

To make matters worse, as passenger transport income decreased due to COVID-19, the net loss of Seoul Transportation Corporation, which operates the Seoul subway, recorded KRW 1,113.7 billion in 2020 and KRW 964.4 billion last year from KRW 586.5 billion in 2019. .

Free transportation accounted for 29% of last year's deficit, or 278.4 billion won.

Local governments, such as the Seoul Metropolitan Government, are in the position that the government should compensate for the cost of the loss as the free ride system for the transportation vulnerable was introduced in 1984 by the order of the president.

If the subway fare increase policy is decided, it is expected that the city bus fare will also rise.

Subway and city bus fares are usually raised at the same time. In April 2007, they increased by 100 won each, and in February 2012, by 150 won each.

As the subway fare increase has been frozen for 8 years and the loss of Seoul Transportation Corporation has increased, some observers say that this increase may be larger than the previous 100 to 200 won.