Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

Uber seeks to return to Vancouver

with 4 comments

I’m sorry that this story comes from a paywalled site. The Globe and Mail reports that Uber has had a meeting with Councillor Geoff Meggs who “said there will be a motion to council this week to freeze the status quo for six months while staff study the issues – past the election in November.” He also acknowledged that this will have to be treated as a regional issue even though “each municipality in the Lower Mainland has its own rules on taxis.”

Mohan Khang of the BC Taxi Association knows he can rely on the Passenger Transportation Board. They turned Uber down two years ago and are highly unlikely to do any different next time. Why? The PTB actually controls who can have a taxi license, even though they are issued by municipalities.

Section 28(1) of the Passenger Transportation Act states that the Board may approve an application if the Board considers that

  • (a)    there is a public need for the service the applicant proposes to provide under any special authorization,

  • (b)    the applicant is a fit and proper person to provide that service and is capable of providing that service, and

  • (c)    the application, if granted, would promote sound economic conditions in the passenger transportation business in British Columbia.

So it actually does not matter what any one city decides to do. The provision to “promote sound economic conditions in the passenger transportation business in British Columbia” means that the established taxi operators’ interest overrule any and all other considerations. Uber could indeed try to satisfy the requirements that there is a need – simply on the grounds that there are fewer taxis here per thousand population than anywhere else in Canada. They could also show that they are working in Halifax, Montreal and Toronto. All the BCTA has to do is point to the impact services like Uber and Lyft have had in cities in San Francisco – where taxi use was more than halved – and the PTB will be obliged to reach the same decision as it did last time.

It has become something of a truism that regulators become the client of the industry they are set up to regulate. That is demonstrably the case with the National Energy Board and the oil industry. While other places have sought to deregulate taxis or to operate on the basis that the public interest in plentiful, affordable and convenient access to mobility services is more important than the survival of existing providers, that has not happened yet in BC. It is not likely to change any time soon.

The people who drive taxis are not the people who drive the industry or the PTB. The people who make significant amounts of money from taxis are those who own licenses. Although these are issued by government they can be traded on the market, and thus, due to their scarcity, acquire significant value. The man (and it is usually a man) driving the cab has to rent the license from its owner. He also has to rent the cab and pay for its fuel, maintenance and access to the dispatch system. A cab driver does not start to earn any money until he is at least halfway into his shift and even then will be very fortunate to clear more than minimum wage. He will do better if his cab also has the even rarer YVR permit – which also means the taxi has to be licensed in Richmond as well of the municipality where it is based.

So for Uber – or anyone else – the task is to get the legislation changed. And while there might well be many people who would like to see that, the people who control the industry also have considerable political weight, not just because they are contributors to party funds but also because they claim that they can deliver votes from the people and communities that rely on employment in the industry. So far as I am aware, no politician in BC has ever tried to test the validity of that claim.

The virtues – or otherwise – of Uber do not matter. The public need for greater access to demand responsive transportation does not matter. Political power is what matters. Geoff Meggs can have as many meetings and as much research as he cares to commission. It will not make any difference to the outcome.

POSTSCRIPTS

I have now seen another post on the same issue from The Georgia Straight – which, of course, isn’t paywalled

The issue of taxi licensing in Greater Vancouver and a possible solution is presented by Ben Proctor in his recent (April 2104) Masters of Public Policy Thesis at SFU. I am indebted to Neil Salmond for this link. The research confirms what I have been saying on this topic. His proposed solution is practical but still requires a politician with considerable courage and willingness to take on a powerful and deeply entrenched private interest group. Both John Horgan of the NDP and Todd Stone in their recent comments regarding Uber show that neither has any intention of changing the present arrangements.

The real issue is that taxis are expensive and not as readily available as needed. Licence owners make a lot of money. Taxi drivers very little – but carry all the risk. Uber ought to be a better system but isn’t. Once again the drivers take all the risk, the company all the profit. Lots of seats in cars are empty: average occupancy of the cars on the road is around 1.4. Most cars are only in use for an hour or so each day. Much of the fleet sits idle most of the time. There are clearly opportunities to make better use of the resources tied up in private cars. The PTB and Uber are both significant blockages on the path to progress towards better, more efficient personal mobility.

Written by Stephen Rees

September 29, 2014 at 12:23 pm

4 Responses

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  1. In the tourism blog about France I read a couple of times a week, quite a few Americans are crazy about Uber, because they don’t trust the average US taxi.

    They ask if they can trust Parisians cab drivers to not fleece them..(as if France wasn’t one of the most regulated place in the world..I read that, should I need a French ID card, I would have to show copies of the birth certificates of my French relatives on both sides, all the way to the great grand parents)

    I don’t like the idea of Uber. How do we know if the cars and the drivers are safe..how familiar are they with the city?

    Red frog

    September 29, 2014 at 9:06 pm

  2. @Red Frog In London all black cab drivers have to pass “The Knowledge” – an exam on the geography of Central London. It takes around two years to qualify. London is the only city to my knowledge that uses quality licensing. All others use quantity licensing (including Paris).

    In Vancouver it is highly likely that your taxi driver will be a very recent immigrant with little knowledge of Vancouver, or English and none at all of dealing with the special needs of people with disabilities. Complaints over drivers refusing to carry blind people (because of their cultural aversion to all dogs) or preferring to use their wheelchair lift equipped cars to carry cruise ship passengers were (in my experience) legion.

    Both Uber and Lyft have their own systems for establishing the quality of their drivers based on user reports. I think people who want to use the system as passengers are also vetted.

    Stephen Rees

    September 29, 2014 at 9:17 pm

  3. I only use Vancouver taxis when someone else is paying the bill. They’re way too expensive to take any other time. I’ve found that most of the drivers are from India and thus have a fairly good command of the English language. I’m used to the accent, but I can see how others might struggle with communication.

    I have had to help more than one driver find my destination, but only when that destination was residential or way off the beaten path. I was surprised to find that my latest driver had no trouble locating my car repair shop and took what I felt was the most logical route to get there in very heavy traffic. The courtesy van driver who did the opposite trip was, by comparison, horrible. He drove straight into a construction project, followed congested streets in the rush hour direction and then expected (by magic perhaps) to be able to make left turns onto side streets. I could have saved him 10 minutes on the round trip, but because my route would have dropped me off first (instead of last) I politely kept my mouth shut.

    David

    September 30, 2014 at 1:37 pm

  4. I drive a taxi in Vancouver and treat all my customers with respect (rich, poor, young, old). Generalizations about people are dangerous.

    Change is inevitable.

    Andrew

    October 16, 2014 at 3:34 pm


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