Melbourne taxis: Victoria to stop cabs turning off meters in rule change

A little-known loophole that allows cab drivers to turn off the metre and negotiate exorbitant prices when hailed off the street is about to be slammed shut.

The Andrews government will introduce new regulations for the commercial passenger industry aimed at stamping out ripoffs. Picture: Ian Currie

A loophole that allows taxi drivers to turn off meters and negotiate an exorbitant price if they are hailed from the street or a cab rank will be slammed shut.

The Andrews government will introduce new regulations for the commercial passenger industry aimed at stamping out ripoffs that have become flashpoints during busy events such as the Australian Open tennis tournament.

Changes will come into effect from September 28, which the government said would be in time for the city’s major events season that includes the AFL Grand Final and the Melbourne Cup Carnival.

The little-known loophole was created when the industry was deregulated by the Andrews Government to allow for rideshare services such as Uber to operate and boost competition.

It effectively allowed for taxi fares to be negotiated at whatever price the consumer was willing to pay after flagging down a car, rather than use meters which had a maximum rate attached.

Transport advocates including some within the industry urged a crackdown when it became clear that vulnerable people were being taken advantage of by unscrupulous drivers after hailing cabs late at night, at busy events where they had no options, or even at the airport.

During the Australian Open, people were reporting being charged $100 for a trip that should have cost $30 or $40.

People reported being price gouged at the Australian Open. Picture: Ian Currie

During this year’s Grand Prix, the government warned drivers not to gouge spectators as it revealed it was considering changing the law to stop exorbitant fares.

At the time, Public Transport Minister Ben Carroll said fans would be hoping drivers showed goodwill and did not charge unfair prices. 

Concerns have also been raised by passengers at Melbourne Airport that drivers were nominating expensive fares to unsuspecting visitors and prices were not reflective of distances travelled.

Mr Carroll said the changes would be introduced before the AFL Grand Final.

“These changes will improve taxi services for Victorians – giving passengers certainty they can get home safely, especially during busy major events,” he said.

“We’re making sure the rules are clear and that people travelling by rank and hail taxis will get to where they need to go without frustrating price hikes.”

The new regulations will mean that for unbooked trips, such as from a rank or hailed in the street in Melbourne, Geelong, Ballarat and Bendigo, drivers always have to use the taxi meter to calculate a maximum regulated fare.

The government said this would remove confusion about how fares can be negotiated, and that it was acting on feedback from the community.

No changes are being made to pre-booked taxi or rideshare services.