Part D â Understanding and improving industry performance (PDF ...

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The inquiry considers that there is a need to rationalise existing government regulation in relation to taxi networks and work to achieve a much more effective balance between industry self-regulation, government regulation and competition. The DOT appears to share this view although it is also concerned that there are underlying weaknesses with self-regulation. Fundamentally, it is DOT’s view that the accreditation schemes have been unable to significantly influence the motivations of industry participants because the underlying regulatory structure remains in place. As with previous legislative reforms in the sector, the accreditation regimes have simply layered new rules on to a regulatory model which has changed little since the 1930s. 42 Significantly, the VTA is also highly critical of accreditation arrangements and in discussions with the inquiry has proposed an alternative structure where responsibility for managing quality services is the domain of networks and not the regulator. The inquiry is sympathetic to the view that the industry should be primarily responsible for service performance, though it has some qualifications to this view: • NSPs must have legal responsibility for the adequate performance of services provided under their brands. Without affecting any responsibility that operators and drivers have, it is considered that NSPs should be covered by the consumer guarantee provisions of the Australian Consumer Law (see case study). • NSPs should actively monitor the performance of their operators and drivers to ensure they adhere to appropriate standards. • NSPs need to implement customer complaint handling procedures that are in line with approved standards. • Procedures and remedies should be put in place to discipline operators and drivers who fail to adhere to appropriate standards. These procedures need to adhere to natural justice principles. They should include provisions to suspend an operator and/or driver from the network for an appropriate period of time. • Regular reports on service delivery should be provided to the regulator and the regulator needs to have powers to audit these reports as required. • NSPs and the regulator need to work collaboratively to ensure industry-wide sanctions can be imposed on persistent offenders. • Safety considerations must be of paramount consideration for the regulator and to its industry monitoring and enforcement efforts need to focus particularly on this. Despite claims by the VTA to the contrary, the power to discipline operators and drivers was not taken away from them. NSPs continue to have the ability to seek liquidated damages from drivers and operators in relation to poor service performance and to impose penalties where these do not conflict with the general law. NSPs have argued that they do not have the capacity to adopt an even more effective measure, which would be to suspend a poor performer from the network for an appropriate period of time. It was suggested to the inquiry that this would involve a restraint of trade. However this matter was clarified by the Federal Court as far back as 2000. 43 As long as the sanction imposed is arrived at fairly and honestly and the sanction is necessary to protect the NSPs interests, an NSP can take this action. It seems the NSPs have felt compromised in taking action against drivers who have not performed adequately. To take a driver off the system would also potentially adversely affect operators who are the main source of income for the NSPs. Far from being a negative, however, the inquiry considers this would be a good thing as it would reinforce the incentives of operators, as well as the NSPs, to ensure drivers did the right things. The inquiry considers that it is essential to have a clear understanding of the respective responsibilities of NSPs and the regulator so that unnecessary duplication of roles is avoided and a more co-operative approach to regulation is achieved. Where possible, regulation imposed on NSPs should be outcome-based and avoid unnecessary prescription, which characterises the current regulation. To this end detailed discussions with the VTA have been held covering a large number of matters including the following: Fares • Fare refusal • Short fare • Refuse WAT work • Bookings Driver appearance • Driver identification • No uniform • Hygiene 42 Department of Transport, Submission to the Taxi Industry Inquiry SS168, p.21 43 Aerial Taxi-Cabs Co-op Society Ltd/as Canberra Cabs v Lee, FCA, 1628, 2000 Understanding industry performance CUSTOMERS FIRST 235
Driver knowledge • Geography • General Vehicle condition • Cleanliness • Safety Driver behaviour • Unsafe/illegal driving practices • Refusing passenger directions • Not taking the most direct route • Rude behaviour • Refusal to assist passenger • Refusal to carry assistance animal • Assault – verbal or physical • Not running the meter/ negotiating price with passenger outside of contracted arrangement • Not logged on to electronic payment system • Running at higher tariff rate • Not complying with legislation or licence conditions The inquiry expects that this exercise will eventually not only lead to a clarification of responsibilities, but it will also be the basis for a more substantive rationalisation of regulatory instruments. This would entail consideration of the legislative provisions, accreditation provisions and conditions, and the Business and Service Standards affecting NSPs. This would potentially result in both a more effective regulatory framework and also one that significantly reduced regulatory burdens on the NSPs. Inquiry findings è The existing regulatory framework places a high degree of emphasis on taxi operators and drivers for delivering quality services, and very little emphasis on networks. The framework relies on prescriptive government regulation and the compliance activities of the regulator to achieve quality services. Market driven regulation and industry self-regulation are under utilised, despite being well placed to deliver efficient outcomes that meet community and industry expectations. è There is large scope to rationalise existing regulation relating to NSPs to more clearly define the role of NSPs in service performance and to remove unnecessary regulatory burdens. 11.5. Performance issues 11.5.1. Ability to deliver guaranteed service/advanced bookings As noted previously, many taxi users are mystified as to why the NSPs cannot guarantee a service will arrive on time (or at all) when it has been booked hours in advance or is a regular daily or weekly booking. NSPs have argued for some time that they are not empowered to direct affiliated operators to perform a booked job. The inquiry has not been provided with a specific reference to a regulation that may give effect to this restriction and has not been able to locate any statutory restriction on this practice. Rather, it seems that the reluctance to direct drivers is a discretionary one: The driver is free to accept or reject bookings offered to the driver by the Network and applicable to the class or type or taxi-cab at the time of offer driven by the driver. 44 In 2004, Silver Top Taxis was the subject of litigation that sought to find that they had discriminated against wheelchair passengers by providing a different service to those passengers. 45 While the case was dismissed, Federal Magistrate Walters did make some pointed comments regarding the service provided to wheelchair passengers: One of the main thrusts of Silver Top’s argument was that it is unable to compel taxi operators to accept or prioritise a booking. The fact of the matter is, however, that for the reasons explained by Mr Franet (from Silver Top), it elects not to compel taxi operators to accept or prioritise bookings. That is so because it has chosen not to make the compliance by a taxi operator with the terms of his licence a real and enforceable condition of his affiliation with the depot. 46 44 Silver Top Taxis Ltd, Owner and Driver Handbook, supplied to the Taxi Industry Inquiry by the VTD, July 2008, p.13 45 Walters FM, Federal Magistrates Court of Australia, Ball v Silver Top Taxi Service Ltd , December 2004, FMCA 967 46 Ibid., p.39 236
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Part D Understanding industry perfo
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The number of licences is restricte
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9.2.2. Quality and safety controls
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Case study New Zealand’s experien
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Case study Singapore’s unique reg
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Case study London’s quality contr
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A report commissioned by the inquir
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From these comparisons, we can obse
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New Zealand is an example of a taxi
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Chapter 10. 10. Taxis, hire cars an
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10.1.2. Substitution with public tr
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Nonetheless, there are market mecha
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10.2.2. Detriments from restriction
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Page 36 and 37: 10.2.3. Are there offsetting benefi
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Page 40 and 41: 10.2.4. Valuing the effect of licen
Page 42 and 43: It would also be possible to implem
Page 44 and 45: Inquiry findings è The detriments
Page 46 and 47: In its 1999 report, KPMG argued tha
Page 48 and 49: 10.3.4. Effect on taxi operators an
Page 50 and 51: The practices raised with the inqui
Page 52 and 53: Historically, the zones generally r
Page 54 and 55: Merging the taxicab markets of two
Page 56 and 57: A further summary of these data is
Page 58 and 59: 10.5. Regulation of taxi-cab fares
Page 60 and 61: • It exposes taxi operators to a
Page 62 and 63: KPMG argued that these restrictions
Page 64 and 65: 10.7. Vehicle regulations Taxis and
Page 66 and 67: Advertisements The policy to remove
Page 68 and 69: In recent years, NSPs have increase
Page 70 and 71: Some respondents argue that the mar
Page 72 and 73: Driver obligations to the NSP NSPs
Page 74 and 75: There are nine accredited secondary
Page 76 and 77: From 1953, the use of two-way radio
Page 78 and 79: 11.4.2. Mandatory network affiliati
Page 82 and 83: Walters FM also said: Until such ti
Page 84 and 85: The ACCC has been called on a numbe
Page 86 and 87: The ACCC also noted that West Subur
Page 88 and 89: This also means that other NSPs and
Page 90 and 91: Metropolitan NSPs charge affiliatio
Page 92 and 93: Figure 12.1 Average fare costs, met
Page 94 and 95: 11.8.3. Affiliation with more than
Page 96 and 97: However, unlike most other goods an
Page 98 and 99: 12.3. Characteristics of the paymen
Page 100 and 101: A further key feature of two-sided
Page 102 and 103: Case study Cabcharge penalised for
Page 104 and 105: To compete with Cabcharge, the newe
Page 106 and 107: 12.5.1. Removing regulatory barrier
Page 108: In addition, given the well establi
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