Taxi licence owners fight for fair deal in challenge to State Government’s compensation scheme

FURIOUS taxi licence owners fear State Government’s reforms will critically devalue their businesses, financially crippling their families.

Taxi licence holders, together with the support of their family and friends, take a stand against the compensation scheme at Parliament House in December. Picture: Mark Stewart

TAXI licence owners say the State Government’s compensation scheme critically devalues their assets and will financially cripple their families.

The scheme is part of changes the government plans to introduce by 2018 in a gradual move to a single registration system for taxis and hire cars.

While the deal has improved since the reforms were announced in August last year, owners said their licences were essentially being confiscated and the compensation did not recoup their value.

The original offer of $100,000 for the first licence and $50,000 for the second has been expanded to $50,000 for a third or fourth licence, but nothing for any subsequent licence owned.

This will be paid out over two years, instead of the eight years suggested when the reforms were initially outlined.

Linda De Melis, whose father owns six taxi licences, said owners had been led to believe taxi plates were assets, and the government was now pulling out of that collective agreement.

She said taxi plates were considered assets under the Commonwealth Income and Assets Form, had been included in superannuation funds and the Australian Taxation Office considered them assets for capital gains tax purposes.

Banks lent up to 80 per cent of the value of a licence and accepted them as collateral against loans and, eleven years ago, the previous State Labor Government also created a trading facility for plates on the Bendigo Stock Exchange.

“We all had a collective agreement that the little bit of paper that is a licence was more than just a bit of paper,” Ms De Melis said.

She noted when fishing licences were bought back by the government, fishermen received an amount for the licence, income compensation and an amount for equipment purchased which could not be sold or reused.

“We are only receiving income compensation and nothing for our assets — our licences,” Ms De Melis said.

Taxi licence holders, together with the support of their family and friends, take a stand against the compensation scheme at Parliament House in December. Picture: Mark Stewart

“Taxi plates were so valuable because they represent exclusive and perpetual business contracts with the State Government … cancelling our licence means they are no longer perpetual and allowing pirates to operate in the same business landscape without a licence means that our exclusivity arrangement with the government has not been upheld.”

Victorian Taxi Association chief executive Georgia Nicholls said the group had concerns about the fairness of the transition package.

“There will … be licence holders who have invested in good faith left in severe financial distress as a result of the changes to licensing,” Ms Nicholls said.

“The VTA hopes the Fairness Fund established by Government, and now open for applications, will assist those in these circumstances.”

Public Transport Minister Jacinta Allan said Victoria had announced more than $420 million to assist licence owners.

“This includes $50 million in targeted support for licence holders who may experience significant financial hardship as a result of the changes,” Ms Allan said

“We continue to work with the industry as we draft the reform legislation, to create a level playing field for the taxi and hire car industry, and safe, responsive services for passengers.”

Taxi licence holders, together with the support of their family and friends, take a stand against at Parliament House. Picture: Mark Stewart

‘They will lose their entire super’

VITTORIO De Melis has served the public as a taxi driver for more than half a century.

Now a retired licence owner, he spent years — many of them in debt — striving to build his taxi business and a financially secure future for his family.

But with changes to the licensing system, and having used his six taxi licences as his superannuation, his daughter Linda said he stood to lose everything.

“Put simply for our parents and countless other retirees in this business — they will lose their entire superannuation,” Ms De Melis said.

“The assets built up over 30, 40, 50 and, in the case of our father, 60 years in the industry — and the income these assets will generate — will vanish overnight.

“At the age of 80 our parents are not in debt, and yet they face the loss of their home at the hands of the government.”

Ms De Melis said she had been clearing out her spare room to accommodate her parents if the taxi reforms went ahead.

She said her father had wept at a family gathering held not long after the changes were announced.

“He asked for our forgiveness and apologised to us because he feels he will become a financial burden — something he never expected and through no fault of his own,” Ms De Melis said.

“This man has been our rock and this is what he has been reduced to.”