Taxi fares in Victoria could be cheaper after Essential Services Commission review

A review could result in cheaper fares for passengers hailing cabs in Victoria – but not everyone’s happy about it.

The cost of hailing a taxi may be reduced.

Victorians could be in line cheaper fares when hailing cabs from the street, with the Essential Services Commission reviewing maximum charges in a move that has frustrated the recovering industry.

The commission regulates maximum fares payable for unbooked taxi trips and is now investigating whether the current scheme is working.

Unbooked fares are when passengers hail a vehicle from the road while trips organised through an app or phone are treated different.

The ESC’s director of pricing, Marcus Crudden, said that there was not as much competition for taxis hailed from the street.

This could mean passengers were missing out on cheaper trips.

“Consumers hailing a vehicle in the street can’t shop around for a better deal, so there is less competition and fewer pricing options for passengers,” Mr Crudden said.

The Essential Services Commission is reviewing the charges for hailed cabs.

“Our review aims to protect passengers who use rank and hail services from paying too much.”

Mr Crudden said laws introduced last year also meant the agency could better examine broader issues within the industry before setting maximum fares.

“We can now consider the Fair Work Commission’s annual wage review and the commercial viability of operating a taxi service, as well as the financial viability of the industry, which has been a feature of previous taxi fare reviews,” he said.

But Transport Matters MP Rod Barton said taxi drivers needed more money rather than less.

“Taxis provide an essential service to the community, yet they are being forced to work in a set of conditions and with a rate of pay that most Victorians would not accept,” he said.

“Bills, rent, school fees, groceries, petrol price. These are all things taxi drivers are worried about while the ESC conducts their time-consuming review.

“Taxi drivers need a pay increase now.”

13 cabs chief operating officer Stuart Overell said the income drivers could bring in had not been adjusted in real terms since 2014.

“13 cabs has been arguing for many years now that ESC are effectively suppressing the amount taxi drivers are able to earn at rates well below consumer price index and immediate action is needed to rectify this.

“No other essential industry or business 13 cabs are aware of are treated this way and most Victorians would understand that the amount people earn should, at the very least, keep pace with annual changes in the inflation rate.”

Mr Overell said regulated fares needed to be kept consistent to provide security for the industry as they rebuild business after Covid.

“To be quite clear 13 cabs is not talking about surge pricing,” he said.

“13 cabs is talking about increasing the amount that hard working taxi drivers can earn in relation to the cost of living. We are talking about fairness here.”