Beijing metro fare hike 'speculation'

Line 14 of Beijing's subway on May 5, 2013. [Photo/Xinhua]

News that Beijing is mulling a subway fare hike is premature, according to the city's transport authorities.

A study of operating costs was launched last month sparking speculation of a possible subway fare increase.

Beijing Municipal Commission of Transport, who is conducting the research, said the possibility of price change depends on the findings and the study is expected to be finished by the end of the year, Beijing Times reported.

Beijing's subway fare was reduced from three to two yuan in 2007 regardless of mileage, to make the city's metro system affordable and to encourage environment-friendly public transport.

The low-price incentive, however, turned out to be a colossal financial problem for the city's government. Four billion yuan was spent in 2011 on subsidizing the high cost subway system, while the total subsidy for public transport stood at about 15 billion yuan.

The possibility of price hike triggered discussion among experts. Some agreed, saying the subway system has devoured a big portion of the city's government spending, which has to take care of education, social security and housing as well.

Others said the current low price was designed to promote public transport and a price increase will unlikely help to ease metro traffic during rush hours.

Shanghai's subway fare starts from three yuan and increases based on mileage. Transferring lines is also charged.