The personalised transport sector is embracing new technologies and models. The most obvious illustration of this is Uber, who have faced a significant struggle breaking in to the market. With over 700 fined issued since the crackdown in April, Queensland Premier Annastacia Palaszczuk has now announced that ride-sharing services will be legalized from 5 September 2016, allowing companies like Uber to legally operate.
The new framework will be implemented progressively, and aimed at levelling the playing field for taxis and Uber. Transport Minister Stirling Hinchliffe framed the changes as 'innovation done with fairness.' $100 million will be budgeted to support the taxi industry through the spike in competition, acknowledging that the taxi industry is unlike other industries facing disruption, restricted by exhaustive Government regulation around the service.
The $100 million adjustment package will attempt to usher in new regulations in a way that compensates taxi drivers for the additional competition. The incentive so far provides for:
- $20,000 in one-off payments for taxi license holders, capped at two licenses;
- A $2.6 million hardship fund to allow disadvantages taxi drivers to compete in the booked market;
- $4.3 million in waived fees for taxi drivers over the next 12 months;
- $5.6 in incentives for wheelchair accessible taxis; and
- $3.7 million in funds for business advisory support for taxis
Booked transport drivers will require a booked service annual license and authorization that will involve mandatory health and criminal checks, and a vehicle with a current safety inspection - limitations to which Uber drivers are already subject. All drivers will be subject to an annual booking service license fee, which will replace the taxi license renewal fee.
The regulations will take a two staged approach. From 5 September 2016, stage one will see taxis continue to have exclusive access to hail and ranks markets. Fines for solicitation and touting are set to double to $487. Maximum fares will be removed, but will continue for taxis obtained at a rank hailed from the street, or those providing wheelchair accessible services and Taxi Subsidy Scheme members. Like Uber, taxis will be able to charge surge pricing, although will see a hard hit on service fees which will be capped at five percent. Customer service standards will be heavily impacted with the removal of standards for dress of drivers, cleanliness and comfort of vehicles, as well as minimum age limits for drivers, English proficiency and electronic payments. From November 1 2016, safety certificates will be valid for 12 months and all fare estimates must be provided before the journey, or agreed upfront.
The legalisation of ride-share services has been a controversial issue across the board, with many people favouring Uber as a cheaper alternative, providing a more streamlined service with higher standards. The Government claims the introduction of blanket regulations will bring improved services for taxis and Uber, reduced waiting times and competitive fares as a result of industry players competing on equal footing. Equal footing will allow for consistency in safety and fair estimates, and will open the market and create opportunities for new and existing participants to respond to market changes and drive competition. However, public response has been mixed, with those in favour of taxis suggesting this is a way to subsidise Uber's entry to the market, making taxpayers fund the changes. The Chief Executive Officer of the Taxi Council was publically unimpressed with the announcement, which may indicate the changes will continue to aggravate tensions between taxis and Uber.
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