I’m a bit confused about the Queensland Government’s position on the Uber ridesharing service, which has the potential to massively disrupt the highly regulated taxi industry. Taxi industry regulations, particularly the restricted number of licences, result in economic rents (i.e. super profits) for licence owners. It appeared that earlier today the Premier supported Uber users competing with the taxi industry, but a later news report clarified that Uber users would still need to comply with taxi regulations (i.e. they’d need to buy an expensive licence) if they’re to compete with taxis. AAP reports (Qld cracks down on Uber taxi service):
Transport Minister Scott Emerson says the company needs to meet existing taxi service laws, such as driver accreditation and vehicle standards.
“The department is working with Uber to outline what safety regulations it needs to meet in order to operate in Queensland, including driver authorisation, which includes detailed criminal history checks, vehicle standards and taxi licences,” he said.
Premier Campbell Newman expressed concern that the service might not be as safe as traditional taxis, and said he wouldn’t want his daughters to use it…
…Mr Newman had earlier said the government didn’t believe in red tape and regulation unless it was absolutely necessary, but later updated his advice following advice from Mr Emerson’s office.
Taxi Council Queensland CEO Benjamin Wash said it was only fair Uber complied with existing regulation.
The Taxi Council CEO is protecting the economic rents accruing to his members. The current regime of taxi regulation is blatant industry protection, and the Queensland Competition Authority should investigate it as part of its current industry assistance review.
My friend and colleague Brad Rogers has written a great piece pushing for taxi industry deregulation:
I’ve also commented on the desirability of deregulation: