Uber turns Victoria’s transport industry on its head
IN 2013 then premier Denis Napthine trumpeted a taxi industry shake-up that featured new peak fares and a Knowledge Test as the biggest reform since the demise of horse-drawn cabs.
Opinion
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IN 2013 then premier Denis Napthine trumpeted a taxi industry shake-up that featured new peak fares and a Knowledge Test as the biggest reform since the demise of horse-drawn cabs.
Three years later, those regulations are set to go the way of the horse-drawn cab largely because of the emergence of “ride-share” operator Uber.
The government is preparing to create laws that would legalise ride-sharing but also level the playing field in a bid — one would hope — to drive competition and result in a better ride for passengers.
MORE: Uber is go in Victoria as cabbies win compo
Uber’s most popular service is the cut-price UberX, where drivers use their own cars to take passengers to a destination after they have booked through a smartphone app.
It uses variable pricing that means when demand is low passengers pay cheaper prices and when demand rises a “surge” price is offered at a vastly inflated rate — which customers accept or reject before getting in the car.
The plan Public Transport Minister Jacinta Allan presented to state Cabinet this week would see taxi operators given the opportunity to set their own fares, too.
Taxis are currently limited to fares set by the Essential Services Commission.
While more competition is theoretically good for consumers, how these radical changes play out in the real world presents a risk for government.
If passengers are left stranded at night, or are smashed with a massive bill to get home, public reaction is not likely to be kind. There have already been cases of over-refreshed Uber passengers agreeing to exorbitant surge pricing.
Another issue is cost to taxpayers.
Cabinet’s expenditure review committee will now work out the finer details, but taxpayers could have to cough up hundreds of millions of dollars in compensation.
Whatever the final scheme set up, safety must be front and centre.
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