If curbing a spiralling multibillion-dollar transport fare subsidy bill was as simple as an Octopus card system reset, the revamp to make the concessionary scheme for senior and disabled passengers more affordable for public coffers would have been much less bumpy.Without restoring the age eligibility threshold of 65 to check the growing pool of beneficiaries – currently at 2.7 million people – the Hong Kong authorities sought to rein in spending first by footing less for longer and costlier trips starting from April. Instead of the original flat HK$2 (26 US cents) for all trips, eligible passengers now pay HK$2 for fares of HK$10 or less and 20 per cent of fares above that threshold. A monthly cap of 240 subsidised journeys was to be imposed next year after system adjustments.But the government has made a surprise announcement that the monthly cap would not be pursued further, and reported savings of HK$69 million (US$8.8 million) during the first month following the overhaul. The U-turn is no doubt good news for those who would otherwise be affected, but it raises questions whether the revamp was well thought through.Secretary for Labour and Welfare Chris Sun Yuk-han said system updates and testing for the proposed cap would cost an estimated HK$30 million, which he said was unjustifiable in light of the estimated annual savings of several hundred thousand dollars. He revealed that only about 450 people, of whom 22 per cent were disabled, made more than 240 trips per month in the past year.Assuming the latest estimate by the government is accurate, few taxpayers would take issue with the about-face and the forgone savings, especially when one in five of these high-frequency commuters is reportedly disabled and might have special needs for medical check-ups, rehabilitation services and work. The cap would cause passengers to worry about exceeding the limit, adding unnecessary mental pressure, Sun said.We trust officials will continue to monitor spending closely to ensure the scheme remains affordable. Given the city’s rapidly ageing population and regular fare increases, the long-term sustainability of the transport fare subsidy scheme cannot be ignored.
Editorial | U-turn on HK$2 fare scheme cap a welcome change of direction
Officials must continue to monitor spending closely to ensure the transport subsidy scheme remains affordable and sustainable.
Hong Kong shelved its HK$240 monthly cap for elderly/disabled subsidies, citing implementation costs versus marginal annual savings. Only 450 users qualified (22% disabled); the HK$30M system cost proved economically indefensible for such small benefit.







