Canberra Airport - Rego ACT - ACT Government

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4. How Many Taxi Licences Should Be Issued While Canberra Airport believes that there is an immediate unmet demand for at least 130 - 150 taxis, it is recommended that there be an initial ballot of 75 - 100 additional taxi plates. It is then recommended that the Government ballot off an additional 40 - 50 taxi plates per annum for the next 5 to 7 years. Subject to our comments below on varying the number plates in each ballot, these ought to be done in half yearly issuances of between 15 and 25 plates and we would suggest that the first half yearly ballot after the initial 75 -100 plates be for 15 plates. We would also propose a simple mechanism for varying the number of plates available at each six monthly ballot as follows: (a) if 5 or more plates fail to sell at a ballot - then at the next ballot, the number of taxi plates available would reduce by the number of unpurchased taxi plates in the previous ballot; (b) if all plates are purchased at ballot - then the number of plates made available at the next ballot would be increased by 5; and (c) if less than 5 plates fail to sell at a ballot, but not all the plates are purchased – then there would be no change to the number of plates available for purchase in the next ballot. This is a simple and effective mechanism to ensure that the market is supplied with additional taxi plates to meet growing market demand as well as adjusting for the historical shortfall in supply in a measured way which ensures that the market will not be flooded. It should not be forgotten that the issuance of additional taxi plates will create additional jobs in the Canberra economy – directly through the employment of additional drivers and secondly through the flow on business that will be created by recapturing some of the lost convention business that Canberra is currently missing out on. It is forecast that the initial ballot of 100 additional licences would create between 120 and 150 new jobs in the ACT. In addition, the issuance of additional taxi plates is an important road safety issue for the ACT – the availability of more taxis will assist in reducing the incidence of drink driving, and violence in late night taxi queues in Civic. In this regard, it needs to be acknowledged that the bus service in the ACT does not have sufficient frequency or availability of service in late night hours, resulting in a corresponding increase demand for the provision of taxi services. This mechanism of regular supply of taxi plates ensures that if estimates of unmet taxi plate demand are wrong or if circumstances change, then the Government will receive signals from the ballot on a six monthly basis as to how many taxi plates are required. The simple fact is that if there are too many plates to be financially sustainable then investors and drivers will not take up the additional 15 - 20 plates that might be available at any particular auction. It must, however, be recognised that such an outcome may not imply an over supply in the market but rather that the market has reached an equilibrium. Subsequent ballots would result
in the issuance of additional licences equal to the market’s assessment of the unmet demand for taxi plates and taxi services. No matter what form of benchmarking the Government might implement in relation to trying to determine the number of taxi plates to issue, it will always run the risk of being wrong in the eyes of the taxi industry or consumers. However, a mechanism such as that described above will allow for the regular availability of plates, but also provide true signals and advice to Government and the market as to the current financial sustainability of the market.
Page 1 and 2: ACT Taxi Industry Review Canberra A
Page 3 and 4: this situation is rectified, there
Page 5 and 6: 2. Should There Be A Cap On The Num
Page 7: Table 3.2 - Taxis Vs Airport Passen
Page 11 and 12: 6. Licence Fee In order to improve
Page 13 and 14: 8. Fare - Commercial Viability And
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Canberra Airport - Rego ACT - ACT Government

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