It is often said that there is no such thing as a free ride. A passenger’s free ride is not free, because somebody else has to pay for it. A case in point involves senior citizens on the urban transit systems that are hemorrhaging money.
Almost one in five passengers is given free travel. In its performance evaluation of the seven subway corporations in six cities, the Ministry of Public Administration and Security says that people aged 65 or older, who are exempt paying fares, account for 19.3 percent of all subway passengers. Losses from the free travel amounted to 342.4 billion won last year alone.
Free rides date back to 1980, when a law on the welfare of senior citizens went into effect. In that year, mass transit fares were halved for people aged 70 or older. The welfare program expanded until 1984, when all people aged 65 or older were allowed to use the subway for free.
The government and the political community find it difficult to withdraw the benefits from senior citizens, one of the largest voting blocks in the nation. From the perspective of the subway corporations, however, the benefits are not sustainable because they incur such heavy losses, and all the more so because raising fares is rarely permitted for fear of stoking inflation.
The changing demographics poses another serious problem. As the population of senior citizens is projected to rise from 10.7 percent of the total population last year to 15.1 percent in 2020, the percentage of non-paying passengers will rise. No wonder the subway corporations are demanding a fix for across-the-board free travel for senior citizens. Top policymakers and political parties will have to ponder how to comply with their request ― a legitimate one, be it politically tenable or not.
There is no easy solution. If the subway corporations are allowed to raise their fares to cover losses, paying passengers will complain. It will also fuel inflation. Senior citizens will revolt if they are charged fares or free rides are limited to those in low income brackets.
But the government and the political community will have to take action to improve the bottom lines ofthe subway corporations. It would be hypocritical of them to blame the subway corporations for mismanagement without fixing the problem concerning free travel.
