$2 fare levy too rich for Bendigo: Uber

Uber has said the proposed $2 levy on taxi and ride-sharing fares – aimed at providing compensation for industry deregulation – could impact the company’s expansion into regional cities like Bendigo.

Asked a recent hearing for an inquiry into the Commercial Passenger Vehicle Industry Bill 2017 if the state government’s plan to introduce the extra cost from 2018 would affect regional expansion, Uber State Manager Victoria and Tasmania, Lucas Groeneveld, said: “Yes, certainly.”

“We would inevitably see that, rural areas or country areas being, I guess, over taxed relative to the rest of Victoria just based on the trip composition,” said Mr Groeneveld, who confirmed the ride-sharing service would pass the proposed levy onto consumers.

The bill would deregulate the taxi industry, allowing drivers to set their own fares, and legalise services like Uber. 

The $2 levy is aimed at financing compensation and the costs of the changes to industry.

Mr Groeneveld, giving evidence to the inquiry at a hearing in Melbourne on May 24, said while the levy wouldn’t necessarily prevent Uber “moving into these towns”, it would “decrease the adoption of services”. 

While there continued to be great interest in the service from cities like Bendigo and Ballarat, according to Mr Groeneveld, these areas had a high proportion of shorter trips, because of the condensed geographical nature of those towns, meaning the levy would represent a “significant proportion of that trip”. 

“We would, I guess, like to see that ($2 levy) remedied to some extent as it relates to launching into regional towns. But we are very excited upon the closure of this reform or the passing of this reform into launching into other areas in Victoria,” he said. 

The report into the Commercial Passenger Vehicle Industry Bill 2017, released on Thursday, recommends the government set a reduced levy in rural and regional areas and the government provide compensation as lump sum payments at the outset of revocation of taxi licences, among others. 

Taxi Action Group Victoria has twice protested outside Transport Minister Jacinta Allan’s Bendigo office in recent months, rallying against the proposed industry changes.

The Bendigo East MP, Ms Allan previously said a state government compensation scheme seeks to support taxi owners, not penalise them.  

Aside from paying owners $100,000 for their first taxi – and $50,000 each for the next three – a $50 million fund will be raised to assist those for whom the changes have meant hardship, Ms Allan said.