27 July 2015

Ride sharing: Why is Australia still stalling?

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"We know cities around the world are grappling with these changes and in particular, the introduction of new unregulated ride sharing apps. I have made it a priority to get to the bottom of these issues, no matter how complex," Andrew Constance, Minister for Transport and Infrastructure

Most if not all of us are aware of ride sharing apps such as Uber, Backseat.me, Lyft, etc. These are app-based ride-sharing services where individuals use their own cars to drive passengers for a fee. It’s convenient as consumers can book a car using the app and then track the car’s progress. The passengers then also have the ability to give their driver a rating based on their experience and the performance of the driver. This is basically just a more formal way of the old fashioned way of carpooling. 

Not only is this app convenient but it also turns out to be a lot cheaper for us consumers. However taxi drivers are not happy with this new form of competition. A survey of 2000 Sydney residents from last year found that the people prefer to use Uber instead of a taxi because:
  • 75% of the respondents quoted the high expense of the taxi is off-putting
  • 15% said reliability was a major reason for avoiding traditional cabs

Despite consumers around the world embracing ride sharing, it is currently illegal in some states such as NSW, SA and QLD.

So why are these ride-sharing services an ‘issue’? Well the answer is quite simple, while consumers are enjoying this the cheap and convenient service, the state governments are missing out on millions of dollars in taxi licence fees whereas the federal government misses out on taxes, and not to mention the taxi industry loses its customers.

The state government has been taking ride-sharing seriously. For example, the NSW Transport Department has begun taking UberX drivers to court for breaking laws that require drivers and cars to be licensed. It has prosecuted 24 drivers and issued 193 warning notices. Whereas, Queensland has issued fines totalling more than $1.7 million in the past 12 months.

On the bright side, Uber has been receiving some political support as well recently. For example, NSW Greens party said in a recent media release that ride-sharing should be legalised and regulated. Also, NSW Opposition Leader Luke Foley has publicly supported Uber and mentioned that he will introduce a bill to Parliament this year to regulate the fast-growing platform.

Earlier this month, transport Minister Andrew Constance announced that Gary Sturgess will head an independent taskforce and we will hear back from the government in October this year on their stance on ride sharing and recommendations on matters relating to competition in the taxi market, the impact of app-based ride-sharing and consumer safety.

Based on the fact that consumers have embraced the simplicity and convenience of ride sharing apps – I can safely say that ride sharing will be legalised – it’s just a matter of when and how? And lastly I wanted to finish off with a quote from Luke Foley which nicely sums up what the government should do: “It’s time for the government to get out of the slow lane and show real leadership when it comes to ride-sharing."

When Aranei was seven she truly believed she could one day train turtles in the Galapagos. Unfortunately she came to the realization that such a thing could never happen. A couple of years later, she decided to be a conference producer and has never looked back. The best part of her role is exploring different sectors and getting in-depth insights from thought leaders and well-experienced specialists from varying sectors.         


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