Low cost 'taxi' service a danger to the public, furious taxi council says

Sydney taxi drivers and the NSW Taxi Council are furious with a new initiative launched by US tech start-up Uber that allows car owners to use their own vehicles to taxi people around for a fee.

The NSW Roads and Maritime Services has requested a meeting with Uber to discuss how the NSW Passenger Transport Act applies to the new service, and how Uber will respond to its obligations under the act. The RMS said it was "looking forward to Uber's response".

Until now, the $US250 million ($270 million) Google-backed Uber has only allowed users to ride in taxis and private hire cars in Sydney and Melbourne. But now it has started to branch out into the "ridesharing" market, allowing anyone to ferry users around in Brisbane, Sydney and Melbourne provided they are at least 24 years old, have insurance, a licence, no criminal record, and own a four-door car that is no older than a 2005 model.

"This has to be dealt with before it gets out of hand," NSW Taxi Council chief executive Roy Wakelin-King said.

Uber Sydney general manager David Rohrsheim says Australians want "ridesharing".Credit: Nic Walker

"We have an organisation that is asking people to take on faith a [taxi or hire car] booking system that has no regulatory checks or balances."

There were no vehicle or driver background checks by the NSW government, he said.

"[It] represents a clear risk to the public."

Mr Wakelin-King said the Taxi Council had asked the NSW government to investigate.

An ad that appears on Facebook for drivers.

"We will also be warning passengers about the risks of using this service," he said.

The service is currently only available to select users but is due to be launched publicly within weeks. Called "low cost" in Australia and "UberX" overseas, the company takes a 20 per cent cut from each fare.

One of the cars that picks up passengers.Credit: Ben Grubb

The new option on the Uber smartphone app has infuriated the taxi industry, according to one Sydney driver, who said drivers were questioning the legality of the service and the fact it was largely unregulated.

Drivers have signed up by responding to Uber job ads on Seek, Facebook and Gumtree. The job ads stipulate that drivers wanting to be part of the low cost service must be "fun and outgoing", with "strong communication skills and great city knowledge", and "be willing to participate in a police background check".

This has to be dealt with before it gets out of hand.

NSW Taxi Council chief executive Roy Wakelin-King

One of the drivers Fairfax Media spoke to said she used to be a fast-food home delivery driver.

Uber's legal obligations are unclear, such as details of insurance and passenger injury compensation.

Uber Sydney general manager David Rohrsheim said every low cost ride was backed by third party liability insurance up to $US5 million per incident.

"With more options, consumers win, drivers win and Australia's cities win," Mr Rohrsheim said.

Already some US states have banned or are attempting to ban similar businesses.

Some have allowed it though, but only after making Uber or other ridesharing services get a large amount of public liability insurance, which has resulted in the services adding $US1 "safety" surcharges to rides.