Page 439 - Week 02 - Wednesday, 20 February 2019
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I want to make it abundantly clear that this is not a debate about rideshare. This is not a debate about Uber. The Canberra Liberals fully support rideshare; we fully support a competitive on-demand transport sector. This debate is about opening up the on-demand transport sector even further. It is about encouraging and fostering competition. It is about allowing taxis to remain competitive alongside Uber and other rideshare services. It is about levelling the playing field and it is about achieving social justice for those who have been mistreated by this government.
We heard from the Chief Minister yesterday that the government is not in the business of guaranteeing investments. With that, I completely agree. We also heard, and I am sure we will hear it again today, that this reduction in taxi plate values has been a result of market forces. This is not true. The government would like to have us believe that its policy is some form of capitalism, that this is simply the way markets operate: that for some investments pay off and for others they do not.
What the Chief Minister has neglected to mention is that this market is not, and has never been, a free market. The taxi industry has always been one of the most heavily regulated markets around. And it is a market that the government continues to operate. The devaluing of these taxi plates is not the result of market forces but a direct result of government intervention. It is a direct result of the government’s decision to release more taxi plates to market and is the direct result of the government’s decision to force leases down from $20,000 a year to $5,000 a year.
Mr Ramsay, in particular, needs a lesson in economics 101. The government report released in September last year, his own report that he spoke to in this place, shows that demand for taxi services is declining and that demand for licences has remained static since 2017. What did the minister do in response to this report? He made the decision, the clumsy and rather heartless decision, to release more taxi licences to market. Any first-year economics student starting at the ANU this week could explain to the minister that when demand is falling in any market, a government regulated market or otherwise, the correct response is not to increase supply. The correct response would have been to reduce the supply of taxi licences.
Another argument the Chief Minister and Minister Ramsay made yesterday is that this policy is about consumers. In this government operated market, the government also sets prices. The government sets taxi fares. I ask the Chief Minister: if this policy is really about consumers, why hasn’t the government reduced taxi fares? Don’t for one second be fooled by this rhetoric, Madam Speaker. Don’t be fooled by Minister Ramsay or Mr Barr that this policy is focused on consumers, that this policy is focused on delivering better services for consumers. This is not about consumers. With new taxi licences expected to raise $710,000 in revenue for the government every year, this policy is just another revenue grab.
A more competitive market without intervention would, of course, be far better for ACT consumers. A more competitive market would put downward pressure on fares. A more competitive market would encourage taxi drivers and operators to improve the services they are providing and would also put pressure on the ridesharing sector to reduce fares and provide better services. All in all, we would have much better on-demand transport options for consumers with a more competitive market.
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