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Jane Holroyd
April 30, 2012 – 12:34PM

The Victorian Taxi Association wants to triple the flagfall rate of hailing a taxi in the CBD.The Victorian Taxi Association wants to triple the flagfall rate of hailing a taxi in the CBD. Photo: Angela Wylie

A minimum $10 taxi fare in Melbourne would not result in people hailing fewer cabs, according to the Victorian Taxi Association, which is pushing for the change.

VTA executive officer and spokesman David Samuel said more than tripling the flagfall rate for booking or hailing a taxi in the inner-city from $3.20 to $10 would encourage drivers to accept short fare trips.

Drivers who refuse to accept passengers who want to travel a short distance is one of many issues being investigated by the Victorian Taxi Industry Inquiry being headed by Professor Allan Fels, which is expected to release its draft report with suggested reforms to the Victorian Government by mid-year.

Mr Samuel said a $10 flagfall should apply to all taxi trips departing from Melbourne’s central business district, with passengers compensated with lower per-kilometre charges, which would kick-in after the flagfall. It is one of a number of submissions that the VTA, which mainly represents taxi booking agencies, has made to the inquiry.

As part of a publicity campaign about the VTA’s recommendations, five drivers will be offering free taxi rides in the city this week.

Mr Samuel said short-fare refusal by drivers was a problem largely confined to Melbourne’s central business district, where drivers often wait for passengers for long stretches of time at taxi ranks.

“It’s largely a Monday to Friday, nine to five problem,” he said. “People want to jump into a cab and go to a meeting that is five blocks away. We’re saying that $3.20 is not enough of an incentive for drivers.”

He said he did not believe such a price rise would result in fewer taxi trips. “All our research has shown that passengers are willing to pay more for a better service,” he said.

Currently, all passengers are charged a $3.20 flagfall as soon as they get into a taxi. Passengers are then charged $1.617 per kilometre, or 56.6 cents per minute if the speed is below 21km/h.

Mr Samuel said that under the $10 flagfall plan, the rates charged per kilometre would be lower to recompense city passengers.

“It is important to remember that taxi fares have not been adjusted since 2008,” he said.

Other VTA recommendations submitted to Allan Fels’ inquiry include a 12-month probation period for new taxi drivers and better training, including new drivers being paired with more experienced “mentor” drivers.

The VTA is also pushing for new laws that would ensure drivers receive a minimum of 50 per cent of revenue raised from taxi fares, and a cap placed on fees charged to taxi operators by licence holders.

“Lots of people focus on the value of (taxi) licences but the real issue is the lease of that licence,” Mr Samuel said.

“At the moment you can be a dentist in Singapore who owns a Victorian taxi license and you can lease that license out to an operator for whatever price the operator is willing to pay.”

The Essential Services Commission has estimated that rents collected by licence holders — who pay up to $500,000 for their licence — account for 15 to 20 per cent of taxi fares. But David Samuel said taxi operators, who own taxis, paid for fuel and all other maintenance costs associated with running a taxi.

He said the VTA wanted new conditions on future licences that would restrict their availability to taxi operators.

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