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Legislative Assembly for the ACT: 2000 Week 8 Hansard (30 August) . . Page.. 2658 ..

MR SMYTH (Minister for Urban Services): I present the following paper:

I ask for leave to make a statement in relation to the price direction.

Leave granted.

MR SMYTH: Mr Speaker, this report is the first review of taxi fares by the commission and I thank the senior commissioner, Mr Paul Baxter, for his report. The government referred taxi prices to the commission to meet the price oversight requirements of the national competition policy. The terms of reference required investigation into the maximum taxi fares for taxi services provided within the ACT for a period of between three to five years, and the recommended method or formula that may be used.

Mr Speaker, I welcome the commissioner's direction on taxi fares. In summary, the commissioner directed that a 7.71 per cent increase in average taxi charges, based on cost increases over the last 12 months, be applied; that the impact of the goods and services tax be set at 7.85 per cent, reflecting underlying cost savings which ACCC guidelines state should flow through to taxi users; and the introduction of three flag fall and kilometre rates to address standard taxis for a single hiring and a multiple hiring and for the high occupancy taxis carrying six or more passengers.

The introduction of these fare categories reflects the wider range of vehicle types now in use as taxis. The ACT government's policy of increasing the wheelchair accessible taxi fleet has also benefited the public by providing vehicles with the capacity to meet the needs of larger groups wishing to travel together.

Mr Speaker, the commission decided that, rather than set a five-year price path using the taxi industry price index model, it will set a one-year price path, and in the coming year will undertake a major study into the most appropriate method for determining prices in this industry. The commission will also consider the outcome of the national competition policy review of taxi and hire car legislation.

The commission's inquiry and report help to ensure that the government is setting maximum taxi fares through an open and transparent process. This accountability comes in part from the very nature of the commission's inquiry process, with its important element of broad community consultation into taxi fares and its subsequent analysis of the information.

The commission's consultation and review period ensured that a large cross-section of the community could express their views about taxi services. The commission released the draft price direction in May 2000, called for public submissions for consideration,

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