Deregulation of taxi fares may sound like a good idea at first glance, but it could “undermine confidence” customers have in the industry and push them toward other, less reliable options, local providers worry.
“It's an essential service, so maintaining cost certainty for citizens is very important,” said Mohammad Iqbal, president and general manager of Red Top Taxi, in an email. “While some may argue that there should be freedom for taxi companies to set prices as they see fit without government approval, we believe there are benefits to this model that ensure fair competition in the industry, consistent costs for customers, and protect customers from predatory practices.
“Introducing cost-uncertainty in the taxi industry has the potential to undermine confidence in taxis as a whole.”
That comment comes on the heels of calls from mayor Cam Guthrie for a “serious conversation” about deregulating the industry and eliminating the need for taxi companies to seek city council’s approval to raise or lower rates.
“To me, it doesn’t make much sense to continue this way,” Guthrie told GuelphToday earlier this week, comparing the taxi licensing process to forcing restaurants to get council’s approval before increasing the price of hamburgers or hair salons in order to discount haircuts rates.
Iqbal doesn’t believe that’s a suitable comparison.
“There are dozens of restaurants or hair salons in Guelph that you can go to whenever you like. But options for safe, licensed transportation are much more limited,” he said. “If a restaurant increases their prices, customers don't hold that against all restaurants. But taxis are different, people look at the taxi industry as a monolith that all follow the same rules.
“Often customers flagging a cab downtown don't even notice which company they are taking, they just have confidence that all cabs are the same price no matter what company.”
There “does not seem to be support” for deregulation of taxi fares at this time, notes Scott Green, the city’s manager of corporate and community safety, adding the cap on the number of licenced cabs in the city has also been discussed.
“Concern with the removal of the cap of non-accessible cabs that we have heard from residents and stakeholders is that the incentive for companies to increase their fleet by adding accessible taxis that are not capped will also be lost,” Green said via email. “Another incentive for owners to operate accessible cabs is that they are also given priority each year for one of the two new non-accessible licences that are added to the existing cap.”
Currently, the number of non-accessible taxis in the city is capped at 108, though there is no cap on the number of “non-taxi drivers,” Green said. There is no limit to the number of accessible taxis licenced by the city.
“While staff will continue to pursue deregulation of taxi fares and remove or expand the licence caps … deregulation continues not to be supported by the local taxi companies,” he added.
Joe Morrison, secretary treasurer for Canadian Cab, said at this point there have only be "minor discussions" with the city about changes to the rate-setting process and he expects it'll take a least a year before changes are implemented, if any are made.
