Jan 21, 2016

The Department of Economic Development, Jobs, Transport and Resources (EcoDev) has recently concluded industry and community consultations on a review of the Multi Purpose Taxi Program. 

Consultation on the program ran from late September to early December this year to ensure all stakeholders including program users, carers, disability advocacy groups, local councils, community groups, and the transport industry could have their say. 

Information collected during consultation will help inform the final recommendations to be delivered to the Minister for Public Transport in early 2016. The Minister for Public Transport will then make a decision on future action. 

The VTA prepared a submission on behalf of all members. Read the full VTA submission here 

The introduction is reproduced below:

The MPTP is a government funded service for many Victorians who suffer from significant disability and mobility issues. The Victorian taxi industry has proudly provided this service for over 30 years and welcomes the opportunity to discuss ways the level of service to the community can be improved for the community and in a way that is financially sustainable for the Government and MPTP transport service providers.

Providing accessible transport is a vital service that government values from an inclusion and economic perspective. This service can be very challenging to deliver both structurally and often personally. The taxi industry and the government have partnered for many years in efforts to provide a service that meets community expectations and is financially sustainable. In recent years, community and government expectations have grown and have increasing looked to the taxi industry to meet those expectations in delivering what is fundamentally a government service. As a commercial industry, however the sole industry delivering the MPTP, the taxi industry is proud of the strong relationships that have been formed in delivering and attempting to improve taxi service to MPTP members.

The VTA understands that that the review is focused on practical ways to enhance the existing program of transportation services of those who are eligible for the program. The VTA’s response to the discussion paper Improving transport for Victorians with limited mobility, A better Multi Purpose Taxi Program follows. The response addresses the key topics raised in the discussion paper. The VTA is available to discuss or explain anything further with the review team should they require it.

Initially, however, the VTA feels it is imperative to discuss how significant reform initiatives have impacted on the ability of the industry to continue to provide this service in its current form.

The systemic nature of some reforms, particularly those relating to licensing, have significantly shifted the industry’s view of itself, the service it provides and what obligations can and should be imposed upon it by government.

For many years the supply of taxi licences was heavily regulated. This regulation helped establish a view that because supply was restricted and external competition was limited, taxi services became an ‘essential service’, therefore the industry had an obligation to ensure all parts of the community could access taxis.

With the removal of these traditional ‘protections’, and a number of other reforms such as a mandated 55/45 driver-operator split, the industry must now seek to operate in a more commercial environment and now questions the commercially viability of these services. Over the past few years it has become evident that many operators and networks across the state operate these services operate at a loss or, at best, from a revenue neutral position.

With the emergence and growth of less regulated services and a virtual ‘opening up of the market’, the VTA and its members are reviewing business structures, service offerings to the consumer and, unfortunately, the commercially viability in continuing to provide wheelchair accessible services. This is of deep concern to many taxi industry members and a position we would prefer not to be in.

Fundamentally, the VTA are of the view that there is, and has always been, a significant market failure regarding the commercial viability of accessible services. As a result, continued government support is necessary to ensure the services can be provided at an appropriate standard. Without this support the service will diminish both in terms of viability and quality.

The current MPTP scheme, while being of great benefit to target members of the community, in many cases, no longer provides adequate incentives to make specialised services commercially viable. Other incentive systems, such as the Performance Based Booking System (PBBS) are administratively difficult to participate in for many businesses, extremely costly in regards to reporting and fundamentally flawed in design. The PBBS also lacks clear definition in regards to what it is trying to achieve.