Victorian taxi fare hike fears under radical industry shake-up

THERE would be no limit to what Melbourne taxi drivers can charge passengers under a radical shake-up that could see the end of meters, with passengers told they might have to ‘shop around’ to get the best fares. We reveal what the plans mean for you.

Victorians face a taxi fares free-for-all under a radical cab industry shake-up. Picture: Mike Keating

PASSENGERS face a fares free-for-all under a radical cab industry shake-up that would impose no limits on what taxi companies could charge.

Cab drivers will only be required to give fare estimates to people hailing vehicles on the street. MORE: CAB DRIVERS MAY SOON SET THEIR OWN FARES UNDER NEW STATE LAWS

Passengers seeking cabs through apps will get fare estimates at the time of booking. But to get the best deal, it is expected passengers will have shop around on the street or through apps.

Concerns have also been raised that the industry deregulation could increasingly lead to drivers refusing short fares.

The changes are included in laws to be introduced to State Parliament on Wednesday. Should they pass parliament, they are unlikely to affect passengers until next year.

Under the reforms, taxis will not be required to use a traditional meter, though the industry expects the current fleet to continue to operate with visible fare tracking.

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One major company is already expected to advertise flat day and night pricing. Other competitors will offer variable tariffs unlimited by any caps, or provide special set fares to the airport for loyal customers.

The fares free-for-all is designed to completely level the playing field. The government argues this will boost competition and lower prices.

Ride-sharing giant Uber is already operating with a no-limits model, under which it has used “surge pricing” to hike fares during periods of high demand or during major public events.

Public Transport Minister Jacinta Allan told the Herald Sun that the “second stage of comprehensive reforms will continue our work in improving services and reducing fares for Victorian passengers”.

“For the first time, we’re providing a level playing field by allowing the taxi industry to compete with new providers and giving passengers more choice,” Ms Allan said.

The government argues the fares free-for-all will boost competition and lower prices. Picture: Mark Dadswell

The next stage of the deregulation plan comes after ­licence fees were scrapped for taxi operators.

The government says for taxi or hire car bookings, 95 per cent will be done via mobile phone apps that would give a fare estimate or charge.

Only cabs with working cameras could use ranks or be waved down on the street, while new laws will cover safety and consumer protection.

The controversial $1-per-trip levy will commence next year once the flexible fare system has begun.

Big questions are likely to be asked about disability services, how to stop drivers refusing short fares, and peak period surge pricing.

Last year Ms Allan put Uber “on notice” over aggressive surges during public transport incidents, calling it “a practice that takes advantage of people at a certain time”.

Public Transport Minister Jacinta Allan says the taxi reforms will reduce fares. Picture: Lawrence Pinder

It is understood Transport for Victoria has been asked to look at how the government can partner with commercial operators when there is an unexpected public transport network failure — in order to avoid spikes in fares.

It is understood hefty penalties will apply to those who profiteer or mislead customers over fares, but it is unclear how that will be policed.

Victorian Taxi Association chief executive Georgia Nicholls applauded the changes and the government’s “commitment to creating genuinely fair and equal competition in the commercial passenger vehicle industry”.

“The finer points of the regulation are still to be negotiated, however broadly speaking the levelling of the playing field is good for consumers and the industry,” she said.

The Essential Services Commission will continue to monitor fares, particularly in regional Victoria, while a new commission will be established to oversee the industry.

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