Taxi Fleets
Last month’s government announcement of the award of five new taxi fleet licences did not set many pulses racing. This is not surprising: the public has become pretty blasé over the years about efforts to improve taxi services here, the new scheme is just the latest chapter in a very long book.
The failings of the present system are well known and have been debated for years: poor driving skills of an elderly workforce; persistent attempts at overcharging, particularly of visitors; blatant refusal of hire; vehicles in dilapidated or unpleasant condition; only accepting payment in cash, etc. The result has been an explosion in the use of services like Uber, despite the ambiguity of their legal status.
Notwithstanding everyone’s familiarity with the topic, the old arguments were given a fresh airing in an RTHK talk show last week, invited guests including the lawmaker from the Transport constituency Frankie Yick Chi-ming and an expert from a private sector consultancy Alok Jain. An associate professor from Hong Kong Polytechnic University, Tony Sze Nang-ngai, joined for part of the discussion.
The most startling point to emerge from the discussion, at least from my perspective, was the fact that not a single new taxi licence is being issued as part of the exercise. The present ceiling figure of 18,163 is being maintained. All 3,500 vehicles covered by the new fleet licences will come from cannibalising existing taxi licences. So this is not provision of additional resources, it is a reshuffle of those we already have. Taking into account also that all selected five fleet operators are players in the existing market (no new consortia have been successful in the award process) then it is plain to see that for all the talk of a new era in taxi matters, this is largely a case of old wine in new bottles.
In announcing the award, the administration stressed the advantages of the new licences. First, around 40 per cent (1,500 of 3,500) of the fleet vehicles will be completely new and the remainder will not be more than three years old. There will be a set number of wheelchair accessible and premium vehicles and more than a quarter will be electric. Secondly, all operators will establish proper training programmes for their drivers and many of them will have an employer/employee relationship which will provide stability of employment and improve the working environment.
Thirdly, all vehicles will be fitted with modern technology such as GPS, dashboard cameras and driver monitoring systems to improve driving safety. Finally, all fleets will offer online hailing services, electronic payments and maintain proper complaint handling procedures.
The main attraction for the fleet licence holders is that they will be free to set their own booking fees. Together they will control roughly a fifth of the total taxi fleet.
It all sounds very worthy, though it could be argued much of the improved service is what we should be getting already (and indeed do get from Uber) or could be achieved by routine amendments to existing annual licensing conditions rather than creation of a whole new licensing regime.
Taxi fares were increased just last month, a rise in flagfall from $27 to $29 and from $1.90 to $2.10 for incremental charges for urban taxis, with similar adjustments for New Territories and Lantau taxis. When the new licences kick in, the fleet operators will have scope to increase revenue at any time by adjusting booking charges, albeit subject to the constraint of market competition.
I will not pretend to be an expert on how the new scheme will work: I am a potential customer, not an operator. One area the studio discussion did not quite get to the bottom of is the possibility of coordination between the different operators. Will members of the public have to keep a record of all five contact numbers? What if one operator cannot fulfil an order right now in a particular location but another could? Do we keep dialling the other numbers until someone jumps in with an offer? No doubt all these issues will get sorted out in coming weeks and explained to the community.
I am wary of being too dismissive of the new licensing regime. After all I recently expounded the wisdom of former chief secretary David Akers-Jones about not letting the best be the enemy of the good. If these taxi fleet licences can bring about early improvement in services, then why not pocket those gains while we work on devising a perfect scheme.
And last year I wrote a rather tongue in cheek column about proposals to amend the system of cross-harbour tunnel tolls, in effect querying whether the glorious future we were being promised was realistic. I was wrong: in the event the new arrangements seem to me to have been an unqualified success. From personal experience, though without any data to support the impression, congestion has been eased and traffic does flow more easily even in peak periods.
So that’s one up for the transport planners and I hope they have similar success with the taxi fleet licences. But if this is just a device to prolong the privileged position of vested interests and delay regularisation of Uber and similar services, then the public will not easily forgive them.