All ridesharing services will be slapped with a $2 fee over the next two years in order to pay for buying back taxi licenses.
Victoria will shake up the taxi and ride-sharing industry in an attempt to both legalise Uber and keep the taxi industry onside.
Premier Daniel Andrews has announced that the current licensing regime will be replaced, and none of taxis, hire cars and ride-share services will require to pay to operate.
He said this would level the playing field for the industry.
“This is the most progressive, comprehensive reform anywhere in the nation,” he told the ABC. “But the reform is grounded in fairness.”
In order to do so, the government will be forced to spend up to $378 million buying back taxi licences to enforce the changes, some of which cost half a million dollars in 2012-2013.
The average cost of a licence is now over $24,000.
The Premier said the changes would “open the door” for more drivers to get into the industry, which would “drive innovation and provide more choice and better services for passengers.”
Victorian Liberal public transport spokesman David Hodgett said there was “nothing fair” about the changes.
“This means Victorians will pay more for Uber than everyone else,” he said. “There is nothing fair about slugging consumers $2 every time they take a taxi or an Uber.”
Executive Director of the Australian Taxpayers’ Alliance Tim Andrews slammed the changes, saying the government was more interested in “bailing out mates” than it was helping taxpayers.
“There is no economic justification to bail out a dying industry because it has failed to keep up with technology,” he said.
Uber said they were “reasonably comfortable” with the news, but was still reviewing the proposed laws.
However, Uber Victoria general manager Matt Denman stopped short of endorsing the moves, saying that anything that makes rides more expensive is “bad for consumers”.
“We would urge the government to provide full justification and economic modelling for the proposed levy,” he said.
Drivers had varying reactions to the news, with some saying on forums they “aren’t too fussed” about the levy, but others expressing concern about the changes.
“If you think that Uber are screwing the drivers now can you imagine Uber, the taxi industry and a multitude of other cars all racing to the bottom together,” one driver said.
“I’m not fussed too much about a levy but I am concerned that the government will begin to interfere with the way I want to operate,” said another. “I decided years ago that I wanted to work for myself without reliance on the government.”
The government is also setting up a $75 million dollar “fairness fund” to help drivers in immediate need, and $25 million to help those with a disability.
