Cut cab fares to lift service, taxi inquiry chief Prof Allan Fels urges

Taxi

It’s time to cut taxi fares, says Alan Fels.
Source: HWT Image Library




TAXI fares should be slashed to improve service and stem the decline in passenger numbers.


The cost of cab fares was a major contributor to passenger dissatisfaction and was driving people away, taxi inquiry chief Prof Allan Fels said yesterday.

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Releasing an update of submissions, he said the complicated licensing structure – there were too many hands in the till – was largely responsible for siphoning off profits and ensuring drivers were poorly paid.

An estimated $4 of every $20 cab fare went to licence holders who had no direct input into the taxi industry.

Prof Fels would not be drawn on how much taxi fares should fall, but overhauling the licence regime could see fares fall by a fifth.

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Prof Fels’ comments contradict the Victorian Taxi Association, which wants fares to rise at least 12 per cent to stem the flow of drivers leaving the industry.

The inquiry has identified possible potential changes including:

INTRODUCING a more flexible, hybrid service that’s a cross between a taxi and a bus.

GIVING poorly paid drivers a bigger slice of the profits.

CHEAPER and more flexible taxi options catering to the disabled, low-income earners and young people forced to drive or walk instead of catching a cab.

CONSIDERING a London style mini-cab hire system.

Prof Fels said public satisfaction with the city’s taxis was at a record low, with the high cost of fares a major contributing factor.

“The high cost of fares seems to be driving people away,” he said.

“They want cheaper, more flexible customer-focused transport options that meet their needs.”

While conceding the quality of many poorly paid drivers, and customer service, were issues, Prof Fels laid the blame squarely with a system in which 80 per cent of licence holders don’t drive a cab.

“Every time you get into a taxi, the first thing you pay for is the $500,000 licence cost,” he said. But with a cost of $1.5 billion, a mass buy-back of licences was not the answer.

Victorian Taxi Association spokesman David Samuel called for fares to be raised by 12 per cent.

There had not been a fare rise since 2008.

 “You could argue that we should have a 30 per cent increase, but that would just scare off customers,” he said.

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