Government deregulates passenger services

Some really good decisions from the Government on the passengers services. Simon Bridges and Craig Foss announced:

Currently there are separate categories and rules for , private hire, shuttles, and rideshare operators. Under the changes, these services will be regulated under a single category of small passenger service, meaning one set of rules for all.

A good start – one simple set of rules.

“New technologies like smart phones and apps have changed the way the sector can operate. Modernising our rules will ensure they are flexible enough to accommodate new business models,” Mr Bridges says

“The Government has clearly stated our intention to encourage innovation and enable new kinds of services. Freeing up the regulatory environment will allow transport operators to compete on an even footing,” Mr Bridges says.

Some rules that impose costs on operators, but no longer provide any significant benefits, will be removed.

“Removing outdated rules will allow a broader range of transport services to develop throughout New Zealand, giving consumers more choice,” Mr Foss says.

People used to just pick whatever taxi was on a taxi stand. Now many people use apps to book a driver, and will swap firms based on quality.

The regulations being removed include:

  • Signage requirements (including information about fares, mandatory branding, information supplied in Braille)
  • An Area Knowledge Certificate
  • Passing a full licence test in the preceding five years
  • The need to belong to an approved taxi organisation
  • Provision of small passenger services on a 24/7 basis
  • Driver panic alarms, monitored 24/7 from a fixed location

These have all imposed a considerable cost and now little benefit. The q+a explains:

The Ministry’s review found that these requirements no longer add value. For example, GPS and mapping technology means that area knowledge is not as important as it was in the past. Removing these requirements means that the proposed regime will be more flexible, and reduces compliance costs. It encourages businesses to make their own decisions about what their services should include, depending on their customers’ needs.

They have also given an exemption from the silly rule about needing a video camera in the vehicle if:

  1. Providing services to registered passengers only
  2. Collection of driver and passenger information
  3. Availability of driver and passenger information
  4. Retaining a record of each trip.

Drivers still need a P licence and a full Police check. However the time taken to do this has dropped from 55 days to 20 days, and reduce further yet.  And the cost is likely to drop from $700 to under $200 which will make it easier for mreo people to become part-time drivers – say students between lectures or retired persons for a few hours a day.

Really good to see the Government not trying to protect incumbent industries with regulatory overkill, but instead responding to a new business dynamic by reducing regulatory obligations on all participants. The end result is better choices and prices for consumers.

On that note Uber has just announced their prices in Auckland and Wellington are dropping 20%. They are already a third cheaper than most taxis, so this will probably mean around half the price in future – great.

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