Gov’t introduces changes to MTR fare mechanism

These changes include the lowering of the fare adjustment rate by 0.8 percentage points.

The government has introduced changes to the Mass Transit Railway (MTR) Fare Adjustment Mechanism (FAM)  following its linkage to MTR Corporation’s (MTRC) property development profits.

Since MTR fares will be linked directly to the MTRC’s property development profits, the government has revised the calculation method of the productivity factor in the FAM formula to lower the corporation’s fare in the long run to benefit all passengers.

Based on the property development profit in 2022, the government has to lower the fare adjustment rate this year by 0.8 percentage points.

The government also has to set a 1.2% special fare reduction for the fare adjustment this year to offset over 40% of the 2.85% unrecouped fare adjustment rate due to the affordability cap arrangement.

The remaining 1.65% recoupment will continue to be deferred and the MTRC will defer implementing another 0.2% of the fare increase rate this year.

“The money to be set aside for incidents that cause disruptions of more than three hours and the maximum amount to be set aside per incident under the service performance rebate will be increased,” the government said.

“Once the amount set aside under the performance rebate reaches $25 million, a Special Fare Day will be arranged on a designated Saturday or Sunday when passengers can pay half price for taking the MTR,” the government added.