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Mike Rowse

The concessionary HK$2 transport fare scheme for the elderly and persons with disabilities began life with clear objectives and manageable costs. It was well intentioned and made a meaningful difference to the lives of the intended beneficiaries.
Unfortunately, it then lost focus, was extended to hundreds of thousands of less deserving individuals and the costs rose exponentially. Hence the attempt in this year’s budget to rein the scheme in and bring the costs under control.
However the intended remedies bring problems of their own, not least the revelation that our much vaunted technological prowess is not all it’s cracked up to be. Apparently it may take 18 months to effect the necessary software changes, so cost saving won’t kick in until the autumn of next year. Frankly that is ridiculous and it’s time to think again.
In the last policy address of his second term, in 2011, then chief executive Donald Tsang Yam-kuen announced the government’s intention to subsidise travel for seniors aged 65 and above and persons with certain disabilities. The scheme was implemented in 2012 and on top of the various concessionary arrangements already in place at the transport operators’ own expense.
The plan was imaginative and socially significant. It is easy for seniors to gradually become disengaged from the wider community, especially after retirement when they have less reason to venture out of their homes and less income with which to do so. This can accelerate their mental, and then physical, decline.
Capping the cost of public transport at HK$2 (26 US cents) per trip removes any disincentive and indirectly encourages a more active and healthier retirement. Setting the qualifying age at 65 was in line with the widely accepted retirement age at the time, which also coincided with eligibility for various welfare payments.

Over the years the scheme was gradually extended to cover more transport modes, for example, ferry services in 2013 and green minibuses in 2015.
But in 2022 came a radical change in approach when chief executive Carrie Lam Cheng Yuet-ngor lowered the qualifying age to 60. In February that year, the scheme was also extended to red minibuses, kaitos and trams, and in September to residents’ services.
The lowered age was presented as part of a package ostensibly designed to improve community morale after the ravages of Covid but widely seen by many observers as an attempt by Lam to boost her popularity, which had been severely dented by the mishandling of the extradition issue.
Whatever the real motive, the decision to lower the qualifying age to 60 was a major error, for two reasons. Firstly, it threatened to nudge public thinking about the appropriate retirement age towards a lower number, when many of the new beneficiaries are of course still working. In fact, with life expectancy in Hong Kong now well over 80, we should if anything be edging the retirement age up in the direction of 70. That is the age at which welfare allowance for seniors ceases to be means-tested. (It is at 65.)
Secondly, the costs of the transport concession scheme began to spiral, from HK$1.4 billion in 2021-22 to HK$3.1 billion in 2022-23 to HK$4.3 billion in 2023-24. The estimates are HK$4.7 billion for the current financial year and HK$5.7 billion for 2025-2026.




Faced with these numbers, the current administration has moved to curtail expenditure. In his budget speech, Financial Secretary Paul Chan Mo-po announced two changes. The fare would remain HK$2 for trips costing up to HK$10, but thereafter passengers would pay the full fare less a discount of 80 per cent.
The number of concessionary trips per month would be capped at 240. Reprogramming Octopus card readers to give effect to the changes could take 18 months, and even then the savings would be modest.
However, the administration has apparently ruled out reverting to the previous qualifying age of 65. I believe this is a major error. In addition to locking in the mistake of the Lam administration, it in effect starts to create another – the myth of chief executive infallibility. How else to explain the reluctance to reverse a clearly erroneous decision?
One argument advanced against restoring the required age of 65 is that the existing holders of JoyYou cards would lose a privilege they had been enjoying. This problem is easily sidestepped: simply grandfather in the existing cardholders so they continue to enjoy the benefit and impose the previous age requirement on new applications received after a future date, say, April 1.

An advantage of this approach is that without any software changes at all, savings would start to accrue immediately.
Another quick win in terms of achieving savings would be to increase the beneficiary’s contribution, fixed since 2012 at HK$2, to HK$3. After such a long period, and given the many fare increases in the interim, this would be reasonable. If the software can’t be changed to effect the revised deduction within a few days, then frankly Hong Kong needs a new IT industry.
Neither of these options would preclude the government in due course from also implementing the measures outlined in the budget. But progress depends on the current chief executive, John Lee Ka-chiu, accepting the principle that chief executives can make mistakes, and when they come to light, the best approach is to acknowledge and correct them forthwith, rather than try to pretend the office is always perfect. After all, even popes have been known to correct dogma.


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Just move Hong Kong’s HK$2 transport fare qualifying age back to 65

A sticker advertising the HK$2 fare scheme for the elderly and disabled is shown on a minibus on February 21. The plan implemented in 2012 was imaginative and socially significant, but the 2022 expansion of the scheme was a mistake. Photo: Elson Li 

Former chief executives Donald Tsang and Carrie Lam converse at the flag-raising ceremony in Golden Bauhinia Square to celebrate the 75th anniversary of the founding of the People’s Republic of China on October 1, 2024. The HK$2 fare scheme was proposed by Tsang and expanded by Lam. Photo: Sam Tsang

A passenger uses the JoyYou card at Diamond Hill MTR station on February 21. Photo: Edmond So

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Hong Kong’s Financial Secretary Paul Chan Mo-po holds a press conference at the government headquarters after delivering the 2025-26 budget on February 26. Photo: Elson Li

A bus shop at Nathan Road in Tsim Sha Tsui on February 24. The government has approved a series of bus fare increments in recent years. Photo: Jelly Tse

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Hong Kong is scaling back its transport subsidies to help balance the government’s books. Photo: Jelly Tse

A source has said the 18-month period is a prediction based on a time frame for replacing Octopus cards with JoyYou ones. Photo: Edmond So

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Hong Kong Financial Secretary Paul Chan speaks during a press conference after presenting the budget for 2025-26 on February 26. Photo: EPA-EFE

Passengers get on the bus on Nathan Road in Tsim Sha Tsui. Government expenditure on the popular HK$2 transport fare scheme has ballooned over a decade. Photo: Jelly Tse

Civil servants step out of the government offices in Tamar during lunchtime on December 17. To achieve more savings from within government, departments must be readier to embrace AI. Photo: Sun Yeung

Monthly cap on Hong Kong’s HK$2 fare scheme unfair to elderly, experts say

The government is considering capping the HK$2 concessionary fare scheme for the elderly to 240 times per month. Photo: Elson Li

The government has paid more than HK$10.7 billion in reimbursements to public transport operators over the past five financial years. Photo: Dickson Lee

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The Hong Kong government’s headquarters in Admiralty on February 22. Photo: Edmond So

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Opinion

Hong Kong Opinion

News

Hong Kong

Policy errors made by previous leaders need to be acknowledged, so the city can course-correct and achieve savings immediately


Policy errors made by previous leaders need to be acknowledged, so the city can course-correct and achieve savings immediately.


Hong Kong transport

Carrie Lam Cheng Yuet-ngor

Paul Chan

Donald Tsang

Ageing society

Transport and logistics

John Lee

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


Just move Hong Kong’s HK$2 transport fare qualifying age back to 65

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Policy errors made by previous leaders need to be acknowledged, so the city can course-correct and achieve savings immediately

Policy errors made by previous leaders need to be acknowledged, so the city can course-correct and achieve savings immediately