Relax Entry Restrictions to Entice More Taxi Drivers

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By Chamber Press Office, 26 February 2018

Relaxing market entry restrictions will be key to addressing the current taxi shortage, according to business group Dublin Chamber.

The Chamber was responding to the launch today of a campaign by the NTA to recruit 1,600 new taxi drivers this year.

Dublin Chamber has welcomed the recruitment drive, stating that a lack of taxis and a shortage of drivers is becoming an increasing problem in Dublin as the economy continues to grow.

Dublin Chamber has called on the NTA to heed calls by the Competition Authority (now the CCPC) to drop prohibitions on new vehicles entering the market.

At present the NTA accepts applications for new vehicle licences for wheelchair accessible taxis (WAVs) only. This restriction has created a permanent barrier to entry for new drivers and distorted the overall taxi market, the Chamber said.

According to Dublin Chamber CEO Mary Burke: "The past decade has a major drop in the number of taxi drivers and vehicles servicing the market. In 2016 the number of taxi drivers was 40% lower than in 2009, while the toal number of vehicles was down 25%. There has been little improvement since. All the while, demand for taxis continues to rise as the economy grows and and tourist numbers increase. An adequate supply of taxis is a pre-requisite for a buoyant city such as Dublin."

In 2014, the Competition Authority warned against the requirement that all new vehicles be wheelchair accessible stating that: “While existing licensed drivers are likely to benefit from this provision, wheelchair users, consumers, businesses and future entrants to the SPSV industry will lose out in the long run".

The Chamber said that this has materialised, with the WAV requirement having proved ineffective in terms of increasing the number of wheelchair-friendly taxis and the availability to people with disabilities of those WAVs already in the market.

The Competition Authority also warned that these restrictions are not of benefit to mobility impaired users: “While economic recovery may encourage more WAVs into the market, this does not mean that such SPSVs will supply more services to wheelchair users, since the returns from servicing other users are likely to be higher, especially with restrictions on entry of standard taxis and hackneys. New entrants may also demand fare increases for all SPSVs (small public service vehicles) to cover the higher costs associated with WAVs”.

The ERSI, meanwhile, has warned that the requirement for all new taxi entrants to drive WAVs, in conjunction with new qualitative measures such as vehicle branding, limits the flexibility of the taxi market to respond to changes in demand and supply. The higher fixed (65%-91%) and variable costs (27% for fuel) associated with a WAV means they are not suitable and uneconomical for many drivers.

Ms Burke said: "Taxi drivers leaving the market over the past 9 years have disproportionally been part-time drivers. Part-time drivers are more likely to supply services during peak demand compared to full-time drivers. Almost three-quarters of SPSV trips occur between Friday and Saturday night with over half taking place between 6pm and 3am. This has resulted in higher waiting times and less availability across peak periods generally. Without a change to market entry requirements, it is likely that the target of 1,600 new taxi drivers will be met."