The government on Tuesday announced plans to raise highway tolls and train fares in a bid to cope with surging costs and to boost the financial stability of state-run enterprises.
The package includes an average hike of 2.9 percent in expressway tolls nationwide starting later this month, and an average increase of 2.93 percent in train tickets from mid-December, according to the Ministry of Land, Transport and Maritime Affairs.
“The government has frozen toll and train rates since 2006 and 2007 in efforts to reduce the burden of ordinary people but the decision was inevitable given persistent factors such as high fuel prices, inflation and the deteriorating financial structure of Korea Expressway Corp.,” the ministry said in a statement.
Korea Expressway has been struggling to get its balance sheet in order in recent years amid spiraling construction and maintenance expenses.
Last month, the state-run highway operator said it was seeking to impose a 5 percent toll raise every two years, saying the frozen fees have eroded its financial conditions and helped increase debts. It has 22.9 trillion won in debt as of last year, which translates to a debt-to-equity ratio of 94 percent.
In a move to minimize the impact on household budgets, the ministry said it would extend discounts on the tolls during off-peak hours and cut fees for privately built highways by up to 700 won depending on the section.
With such markdowns taken into account, the actual range of the toll increase will be no more than 1.76 percent, the ministry noted.
As for railroad services, ticket prices for KTX, Saemaeul and Mugunghwa will increase 3.3 percent, 2.2 percent and 2 percent, respectively.
The ministry said it also plans to differentiate rates for routes based on the speed of the trains, required time and timetable to make fairs more reasonable.
By Shin Hyon-hee (email@example.com