The taxi industry is quietly being deregulated, taking most of its accountability with it
Right now, the government are consulting on a raft of changes that deregulate the taxi industry. They’re selling them as a simplification of the rules which will be a win-win for passenger safety as well as emerging technologies. I am not convinced.
To give you some context, the review of the sector, according to this Ministry of Transport page, is designed “to ensure that New Zealand’s regulatory environment for Small Passenger Services continues to be fit for purpose and flexible enough to accommodate new technologies“. In other words, they won’t completely ditch passenger safety and accountability mechanisms, but these will be significantly compromised to make it easier for the Ubers of the world to operate legally. Here is a table, from the same page, which tells you what’s about to change. If it looks too jargon-y, feel free to skip it and see my comments on the review underneath.
| Land Transport Amendment Bill | Operator Licensing Rule and Worktime Logbooks Rule |
| Creates a small passenger service licence | Extends the maximum worktime without a break to 7 hours for all small passenger services |
| Creates new requirements for drivers to drive under a transport service licence holder and for drivers of small passenger service vehicles to present vehicles for inspection, when required to do so, by the NZ Transport Agency | Specifies new requirements around third party facilitated carpooling |
| Creates a requirement for certain records to be kept under facilitated cost-sharing arrangements | Specifies in-vehicle camera requirements and exceptions |
| Removes mandatory signage, including Braille | Removes the requirement to have passed a practical driving test in the last 5 years |
| Removes the P endorsement course (through an amendment to the Land Transport (Driver Licensing) Rule 1999) | Removes the mandatory panic alarm requirement for taxis |
| Extends the exemption on child restraints to all small passenger services (currently taxis are exempted from having to provide child restraints). This is through an amendment to the Land Transport (Road User) Rule 2004. | Removes the mandatory requirement to calculate a fare through the use of a meter for taxis |
| Prohibits smoking in all vehicles used in a small passenger service in the future system (through the Smoke-free Environments Act 1990) | Removes requirement to operate on a 24/7 basis for taxis |
| Removes approved taxi organisations | Removes the Area Knowledge certificate and English language requirement |
| Removes the Certificate of Knowledge of Law and Practice |
Five reasons I am unimpressed with the Small Passenger services Review
- The Ministry of Transport did a terrible job of informing the public about the review, including the current consultation phases.
If the fact that said review has been in various googlable stages of development for a year and a half and this is the first time you’ve heard of it isn’t enough proof, the consultation process itself should be. The Ministry say they consulted with stakeholders in April, 2015. Judging by the 11 submissions received, “stakeholders” consisted exclusively of small passenger service operators, and not many of those at that. These are nationally applicable changes, affecting all taxi, shuttle, private hire and dial-a-driver services, not to mention all of the users of said services. Obviously, this was an embarrassing lack of consultation for such wide-ranging legislative amendments. Presumably for this reason, in December, they got around to announcing a public consultations phase. this time, they received 76 submissions. They analysed the main issues the submissions brought to light (in the summary doc on the same page), but while they acknowledged the issues, they consistently failed to address them adequately. I’ll demonstrate this with examples now.*
- The review team are of the unwavering opinion that the need for service providers to protect their brand reputation is a suitable mechanism for protecting their passengers.
Specifically, the review team think that
- Operators should be free to determine how they calculate fares, on the basis that the operator (or driver) and passenger have both agreed to the fare before the trip. No common system, such as an online fare calculator, need be used. It would not be difficult, under this new system, to rip off people who are unfamiliar with the route in question, or unfamiliar with normal taxi fares in New Zealand generally. As the Ministry of Business, Innovation and employment also point out in their submission, there are currently no provisions ensuring that mechanisms that drivers may well use to calculate fares (like meters, odometers and apps) are actually accurate.
- There is no particular need to make sure Small Passenger Service operators bother to write down specific, critical details of complaints (like who was involved, whether action was taken, and what said action was).** This, apparently, incurs extra and unnecessary cost. Instead, operators are simply told to “keep a record of complaints received” and to tell the NZTA about “any serious improper behaviour by a [small passenger service] driver”. This, funnily enough, may well be difficult to track down, now that the record-keeping of complaints is allowed to include only those details the service operators see fit. Seeing as there is no mandated need for an SPS operator to record whether it resolved a complaint (even though the record they do have can be inspected by NZTA), the rate and promptness of complaints being resolved is likely to decrease as well.
In practice, combine these two requirements and you have a situation where, if you agreed to a fare which you didn’t know was exorbitant, that is your problem, meaning that if you complain about it, the likelihood anything will actually happen is just about zero.
- If you hail a cab and there’s a problem, you might have a hard time figuring out how to complain about it…
Taxis are currently required to provide signage, which includes the operator’s name, phone number, business location, fleet number and fare schedule. All but the location and fare schedule should be shown in Braille too. In addition, there should be a sign showing they are a taxi approved by the NZTA.
Now? Scratch all of that.
Apart from the fact that brands can make themselves unnecessarily difficult to track down if they so desire, there is a danger that this will increase the number of unregistered drivers pretending to be taxis given that no-one needs to go get approved taxi signs any more. Hopefully, Braille signage will at least still be obligatory for taxis contracted under the Total Mobility Scheme (this scheme gives passengers with a disability a discounted fare).
- Apparently, drivers don’t require area knowledge or basic English language proficiency for their jobs any more.
While GPS are pretty good at locating the streets whose many names are not easy to remember, knowing where your local churches, major entertainment/sports venues, supermarkets or take-aways are would be a huge help in ensuring the smooth operation of taxi services. Passengers shouldn’t have to waste time asking a GPS what street number these places can be found at; but as I have witnessed, and been told on several occasions by other blind passengers, this is necessary all too often already. While the area knowledge test that currently exists may not be ideal, it would make more sense to review it, rather than pretend that the existence of GPS can make up for the knowledge.
Additionally, the excuse that the review team give for removing the English Language proficiency testing is that it was part of the area knowledge certificate and that the test doesn’t improve the drivers’ English anyway—because that’s totally what English language tests are designed for, apparently. I would have thought it would be an immutable fact that a basic level of English proficiency is important in a service that revolves around a certain amount of necessary communication between the passenger and the driver.
- The review team are okay with some compromises to ensuring passenger safety.
- In order to get the P Endorsement—essentially a safety requirement which drivers will thankfully still need to have to work for an SPS, you currently need to have passed the test for a full driving licence in the last five years. This requirement is zapped in the new regulations. Of course the test costs money… But passenger safety should be the top priority. Full stop.
- As an SVS operator, you don’t need a certificate proving you actually know all the regulations (called a Certificate of Law and Practice) any more. Obviously, not being familiar with the regulations that affects you gets you nowhere in court, but it’s certainly not going to do anything positive for general levels of compliance with said rules. The regulations may be pretty minimal now, but that should mean that those which managed to make the cut and will still exist ought to be even more strictly enforced.
If you have a desire to voice your views on any of the changes (including the many I haven’t talked about), the good news is that this is currently possible:
- First, Scroll up to the table to see if the changes you care about come under the Land Transport amendment Bill or the new Rules. Then, click on the appropriate link to
- Make a submission on the Land Transport Amendment Bill NOW (closes 27 Oct), or
- Make a submission to the draft rules (closes 18 Nov)
- Finally, tell social media that this deregulation is happening. A public consultation phase is not a public consultation phase if no one bothers to tell the public!
*I’m taking the information about what the review team think from the analysis and summary of submissions doc on this page.
**In this rule, the regulations in clause 2.118 used to also apply to SPSs, under the 2007 version of the Operating Licensing rule. The only applicable regulations now come from 3.3.
Anybody with a drivers licence can collect someone and drop them off. If the driver wants to charge the passenger, they should be allowed to make such agreements and advertise.
If somebody wants to call themselves a ‘taxi service’, they should meet the requirements, such as having a camera, displaying ID, industry code of conduct, etc. If people choose not to meet such requirements to hold a ‘taxi license,’ they should still be free to call themselves Uber Drivers or whatever.
Those who hold a basic drivers license are allowed to drive their friends around, so let them drive people round for a profit! The consumer gets to choose. They can go with a taxi company where they feel comfortable cars will have a current WOF & REG, criminal record checks are done, cameras installed, etc … or they can choose to pay someone who is not a registered taxi and will not film them, will charge them better rates, who will keep profits in NZ, will give them their personal number, etc
Don’t get me wrong, people shouldn’t be driving others, let alone themselves around without a REG & WOF and holding a full NZ Drivers Licence for passengers. If I started charging people for a cup of coffee and a chat, if successful I might make regular income. Should such a person be forced to register as a restaurant and obtain a masters in psychology?
The current taxi industry is just a racket and fast going the way of the farrier.
Zack, it’s not always about “consumer choice”. Not all “choices” have positive outcomes.
Some, like weekend trading took away working conditions and reduced wages for retail workers.
So “choice” for some comes at a cost to others.
You use the word “choice” Frank – I’d use the word “freedom”. When somebody is issued a Full NZ Drivers Licence, they have stratified the NZ Government they can safely drive on our roads and carry passengers. As such, drivers should have the freedom to charge for an activity they are licensed to do, i.e. giving people rides.
Truck drivers are allowed to charge for their services once the government is satisfied they can drive a truck. I simply don’t buy into your unforeseen consequences argument. We already have The Consumer Guarantees Act, WOF and REG, tax law, etc.
By your reckoning, sex workers should only be employed through a brothel and therefore always be beholden to a pimp/madam who rents them out.
The taxi companies here in Christchurch haven’t been fit for purpose for a long time. What people forget when it comes to regulation, is to regulate! In the beginning legislation around taxi services was probably wonderful. Over time the understanding of legal obligations, cars and technology has become ubiquitous. Conventional taxis have become less relevant.
On a mobile app you can see available drivers straight away, call them straight away, get a price straight away, make payment straight away, etc. Regulators are forcing us to call landline numbers, wait on hold, be hung up on, give all our details manually, wait for an available taxi, wonder when the taxi will turn up, forced to listen out for the taxi, be made subject to meters, have no choice in which driver you get, etc, etc
Sorry, it’s 2016! The awful thing is, there is a high possibility somebody offering say … $10 rides through Facebook and who will text/call when they’re outside your house … well, that worker/entrepreneur would probably be charged by the police.
I’m not crying a river for taxi drivers using outdated and over regulated business models. I’m happy entrepreneur can use business models like Uber to put food in their mouth!
Zack, your vision of “freedom” is someone elses’ lost job or reduced wages or clawed-back conditions. We’ve heard it all before from the Nats and ACT, and their promises are like smoke.
The Consumer Guarantees Act may protect “consumers”, but it does nothing for the workers who are impacted by your laissez-faire theories.
Re your example of truck drivers. Once upon a time they were protected by the Drivers’ Union. Good wages and conditions. Safety.
Now, it’s a free market with low wages, poor conditions (and even those are flouted) and worsening safety. Even former ACT MP, Ken Shirley seemed to realise the folly of de-regulation when he recently lamented;
Ken Shirley was speaking on behalf of the employers group, the Road Transport Forum.
ref: https://fmacskasy.wordpress.com/2016/05/15/foot-in-mouth-award-former-act-mp-exposes-flaw-in-free-market-system/
So your example is flawed.
Frank, I know plenty of truck drivers and they all earn $1000 or more per week. The lady who earns $1000 works 9-5 on weekdays around Canterbury. Another friend drives up and down the South Island. He’s from Australia so it sounds like deregulation has enabled him to have a job. I’m not an expert but I’m sure trucking deregulation made it easier to be self employed – is that a clawing back of conditions!
I’ve thought about becoming an Uber Driver in my spare time. The working conditions would be great. Flexible hours, no mentally ill bosses, freedom to choose your clothing, etc. I’m not seeing any clawing back of conditions!
Who would you rather hire Frank, Jo who’s just been berated by his boss for half a hour, is overtired from being forced to work a dabble shift and is a Muslim who disapproves of your western ways (it has happened, no discrimination intended) OR would you rather someone who has just had dinner, logged in Uber and feels like driving people around … oh and will furnish you with roses chocolates … oh and text when they’re outside … oh and have SD cards full of categorized music, etc, etc …
Conditions for everybody sound so terrible! This isn’t about a left or right wing ideology Frank, this is about good old fashioned anarchism – the kind that made America great once. This is about taking the power from big taxi companies, even Uber, then giving it back to the-little-guy who already owns the means of production (their car and license).
The race to the bottom was and is so predictable. That bozo’s like Ken Shirley are admitting this, finally and begrudgingly, really says it’s gone to far.
The problem is currently been masked by Nationals unofficial immigration policy, cheap labour from third world countries who have the carrot of residency dangled in front of them, in return for their meagre pay and poor conditions. I know, I’ve seen it.
They hang on, get residency, then head off to Aussie or at least join the churn of workers wanting better than just naked exploitation.
Our governments constant short-term thinking to maximise returns to investors is lowering the standard of living in this country incrementally day by day.
I agree XRAY, that’s why I’m for it being easier for taxi drivers to be self employed.
If such an owner-operator offers a good service, they can build a customer base, work as many/few hours as they want, choose their own working conditions.
Huge ACC levies, mileage taxes, camera install costs, specialized accountancy fees, etc drive owner-operators out of the market. Then workers often get left subjected to companies who pay low wages.
For example, the last thing the Housing Crisis needs is more restrictive regulation. Having urban limits in place has been the ‘land banker’s’ wet dream. I’ve spoken to plumbers, painters, builders and they all say regulation is forcing them to buy inferior products, at TWICE the price of products which are far better! Regulation run amok!
The health and safety of workers is more important than the end product/service, but both can easily have great results. We need regulation that enables people to work.
Hundreds of thousands of Kiwis are excluded from professions and licenses due to criminal (minor/major) convictions. Even more Kiwis are unable to start their own business ventures due to costly regulations and other exclusionary criteria.
NZ embraced capitalism, all be it crony capitalism a long time ago. For capitalism to work … you need capital, aka money to invest. Banks, the government, charities, pretty much nobody wants to lend to entrepreneurs. Combine this with low interest rates and high living costs … well, savers are having their capital investment ability eaten way.
When I’ve driven around poorer suburbs in Christchurch, I’ve noticed people have never looked so poor. They are using shopping trolleys for their belongings, wearing rages, looking very sick – they have nothing! But wait, what’s that – young men are washing car windows at Linwood (poor ChCh suburb) intersections! Better change the Christchurch City bylaws and have these youth charged and carried away!
Good news (for now) from the UK….
“Landmark employment tribunal ruling states firm must also pay drivers national living wage and holiday pay with huge implications for gig economy”
“Employment experts said other firms with large self-employed workforces could now face scrutiny of their working practices and the UK’s biggest union, Unite, announced it was setting up a new unit to pursue cases of bogus self-employment.”
We need this sort of action here. We may not have Zero Hours, but when jobs are called gigs, but your not in Metallica…well its not good.
https://www.theguardian.com/technology/2016/oct/28/uber-uk-tribunal-self-employed-status
This is to cater to all the new immigrants flooding into the country as taxi driving is often the path to having employment. It will put pressure of those already driving taxis. National is creating one hell of a mess in more ways than one.
Passenger service drivers do not have to sit a practical driving test in the last 5 years. They do have to pass a basic medical test every five years ( eyes, urine for diabetes etc)