[Asia Economy Reporter Byeon Seon-jin] Local governments are arguing that "the eligibility criteria for welfare benefits for the elderly aged 65 and over should be raised" as deficits caused by free subway rides due to population aging worsen. This has even sparked controversy over the interpretation of the Elderly Welfare Act, which defines the senior citizen discount standard as ‘65 years and older.’
According to the Ministry of Health and Welfare, Article 26 of the Elderly Welfare Act enacted in 1981 stipulates that the state or local governments provide free or discounted access to transportation facilities and public facilities such as palaces, museums, and parks for elderly people aged 65 and over. The following year, when the ‘senior citizen discount system’ was implemented, the subway fare discount of 50% for those aged 70 and over was lowered to those aged 65 and over. The current free ride system was established in 1984 when the enforcement ordinance of the Elderly Welfare Act was revised under the leadership of then-President Jeon Du-hwan. In 1982, when the senior citizen discount system was implemented, the proportion of the population aged 65 and over in South Korea was 4%, but last year it rose to 17.5%. By 2025, it is expected to reach 20.3%, entering a ‘super-aged society’ where one in five people is elderly. Local governments, which have to bear the deficits caused by free subway rides, say, "It is time to consider raising the age limit for the free subway ride system."
Daegu City “Considering Raising to 70” Seoul City “Government Should Support”
Daegu City is considering raising the free subway ride age from 65 to 70. Since the Elderly Welfare Act stipulates ‘65 and over,’ there is no problem even if one local government raises the free subway ride age without revising the law. This interpretation is similar to the Ministry of Strategy and Finance’s position that local governments also have the authority to decide subway fares. On the other hand, Seoul City believes that since the free ride system applies to all subways nationwide by law, a national-level legal amendment is necessary rather than local governments arbitrarily restricting it. Seoul City holds the position that the government should partially compensate local governments for losses caused by free subway rides.
An official from the Ministry of Health and Welfare, the department in charge of the Elderly Welfare Act, said, "There is no law explicitly stating the elderly age standard as 65, but the senior citizen discount standard is set at 65 and over according to the Elderly Welfare Act. The issue of the elderly age standard is also related to pension receipt and retirement age extension, so it requires social consensus." They added that legal review is necessary first to determine whether it is acceptable to apply 70 instead of 65 and whether local governments can implement different free ride criteria.
Experts “Need Caution” Elderly Groups “Strong Opposition Equivalent to Regime Change”
Although there are calls to raise the elderly age standard due to aging and increased life expectancy, there are also many opposing views. Seoul City also announced a survey result that the average age considered elderly by residents aged 65 and over in Seoul was 72.6 years.
Professor Kwak Min-young of Daegu University’s Department of Social Welfare pointed out, "Elderly people engage in a lot of social and physical activities through subways, and if the free benefit standard is raised to 70, the time they have to stay at home will increase accordingly," adding, "This is not an issue that can be decided solely based on economic logic." Lim Chun-sik, president of the National Federation of Elderly Welfare Organizations, said, "Free subway rides partially alleviate elderly poverty and provide incentives to move, which helps improve health," and warned, "In a situation where social security systems to resolve high elderly poverty rates are insufficient, suddenly raising the benefit age standard will provoke strong opposition equivalent to a regime change in next year’s presidential election." He suggested, "The benefit age of 65 and over should remain as is, but a selective approach based on income and property criteria should be considered."
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