FARES on Metro Lines 1 and 4 would remain unchanged, a senior government official said Tuesday, relieving public concerns that a hearing next month would result in fare increases.

The hearing will set fares for Metro lines yet to be completed, Wu Bin, vice head of the city's State assets supervision and management bureau, said in a call-in radio program.

Five new Metro lines - Lines 3, 2 and 5, and extensions of Lines 1 and 4 - would open by the end of next June, earlier reports said.

There had been growing concern that the public hearing, as in most public hearings, would favor fare increases, the Southern Metropolis Daily reported.

"A hearing should be subject to strict government supervision and not always result in fare increases," Wu said. "I don't see that the Metro company has any intention of raising fares, either."

However, Shenzhen Metro said in a statement in July that it was considering an increase in fares with the company predicting a loss of 22 billion yuan (US$3.25 billion) between 2012 and 2016 as a result of the huge investment and "low-priced fares."

Based on the Metro's huge investment, interest and depreciation, fares should average nearly 6 yuan, but the existing average fare was 2.8 yuan - far below the level needed to offset losses, said Huang Rui, chairman of Shenzhen Metro Co.

Huang proposed that a flexible pricing system be established to reduce the Metro's losses. Huang said a loss of 22 billion yuan would exert great pressure on the city's finances, the Shenzhen Evening News reported.

But an immediate price jump to 5.9 yuan would not be accepted by travelers, said Xiao Youmei, a local legislator. "The Metro company should focus on reducing costs," he said.

Shenzhen Metro also lacked financial and policy support from the municipal government and preferential policies for interest, depreciation, tax and electricity costs would help reduce losses, Huang said.

Source:Shenzhen Daily