The long-awaited Green Paper for the Personalised Transport Review (aka the Uber Review) has been released. The trouble is, as highlighted by Gene Tunny in a previous post, the Green Paper provides almost no analysis to objectively assess the most appropriate regulatory and policy framework for personalised transport in Queensland.
Four major options are presented in the Green Paper:
- Option 1: Do nothing.
- Option 2: Legalise ridesharing in south east Queensland with hailing and cab ranks restricted to taxis.
- Option 3: Legalise ridesharing across Queensland with hailing and cab ranks restricted to taxis.
- Option 4: Deregulate with a safety-focused accreditation scheme.
These options and related discussion are, for the most part, constructed on the premise that the Government is best placed to determine the future of personalised transport in Queensland, rather than establishing a least-cost regulatory framework and letting consumers decide. There is insufficient recognition that increasing competition will obviate the need for much ‘command and control’ regulation.
Scant attention is also paid to identifying the nature of the policy problems or the objectives of government regulatory action. As a result, the Green Paper is a ‘brainstorm’ of ideas, from legalising ridesharing in the south east corner but retaining the taxi monopoly for the rest of Queensland, to mandating vehicle signage or deciding whether or not taxi drivers should have to wear seatbelts.
The Green Paper uses an opaque form of multi-criteria analysis (MCA)(a fancy name for ranking) to evaluate options using the Final Guiding Principles (Accessible, Accountable, Customer focused, Innovative and Safe) as the assessment criteria.
In a standard MCA each policy option is given a score for each criterion and these are weighted and summed to give an overall score. But as Dobes and Bennett argue, MCA is flawed and a poor substitute for cost-benefit analysis. While MCA avoids the challenge of quantifying dollar values for positive or negative impacts, it does implicitly assign values (in this case, by assigning arbitrary values to the guiding principles, which is not the same as determining whether Queenslanders are actually better off).
Moreover, the MCA in the Green Paper does not even attempt to weight the criteria and score options, instead it makes a purely subjective assessment. The Review Taskforce concludes all options either ‘satisfactorily’ or ‘strongly meet all of the principles’. This leads to the implausible conclusion that Queenslanders could be better off by maintaining the status quo, and the similarly fanciful conclusion that the Government could choose any of the other three options and the community would be equally better off.
This approach allows maximum flexibility for the Review Taskforce to recommend any of the reform options without testing the evidence on impacts, or providing an opportunity to identify unanticipated consequences, or any better options. By not consulting on an objective evidentiary base, it is also a lost opportunity to increase acceptance and understanding by interested parties of the option ultimately recommended in the forthcoming White Paper.
The Green Paper does raise a number of interesting policy issues, such as improving transport options for people with a disability by reforming the government subsidy scheme. However, it fails overall by not identifying, in either a qualitative or quantitative sense, the costs or benefits of the individual reform options.
Instead, Queensland consumers are looking down the barrel of a significant regulatory decision being based on limited analysis. Let’s hope the White Paper manages to find an option that provides the greatest net benefit to the community.
Rod Bogaards is an economist and former Director of the Productivity Commission.