Beijing promises to solve its taxi problem with fare increase

PUBLISHED : Wednesday, 17 April, 2013, 12:32pm
UPDATED : Thursday, 29 August, 2013, 4:13am

Beijing's municipal traffic regulator has announced a series of reforms over the next two years aimed at ending the increasing scarcity of taxis in the capital.

"After one to two years, we want to create a balance between supply and demand in the taxi service," the Beijing Transport Commission said in on its website on Tuesday.

The city will introduce new measures including an increase in fares and a tentative liberalisation of the industry by putting an end to permanent licences for taxi companies. While not aiming at increasing the number of vehicles in the already congested city, the regulator says it wants to increase the number of cars on double shifts - driving night and day. 

With these measures, Beijing administrators aim to guarantee that 80 per cent of the city's taxis operate during rush hours, assuring that more than 50,000 vehicles are on duty when the city's commuters need them most.

Being a taxi driver is becoming less and less lucrative. Except for a fixed-rate fuel surcharge, fares haven't changed since 2006 keeping salaries the same - even though the city's economic output has increased 9.1 per cent on average over the last five years, and consumer prices have soared.

The number of taxi drivers in Beijing has decreased in the last two years, the Economic Observer reported earlier this month. Only half of the 200,000 licences issues are actually used.

In future, taxi drivers will be the sole beneficiaries of fare hikes, the commission promised, according to a report in the People's Daily.

Last week,news reports suggested that the flag-fall might rise from 10 to 15 yuan and the fare per kilometre travelled might rise from 2 to 2.4 yuan. Detailed figures are yet to be announced.

Taxi drivers have long called for a change in the way their accounts are settled with employers. Taxi companies provide cars to drivers on a service contract basis, who then pay them 5,000 yuan or more per month in commission fees, the Beijing News reported.

The companies will soon be obliged to publish fees they charge to drivers on a regular basis, including social security contributions and management fees. Companies that fail to provide adequate service could lose their licences after six years, under the new regulations.

Wang Keqin, a mainland journalist, who gained prominence by exposing the dire conditions of Beijing's taxi drivers, said he was not convinced by the reforms.

The taxi companies with their "hegemonic power are used to silently take more and more money," he told the Post.

Wang has previously exposed the long working hours, work-related diseases and the crippling deposit and management fees that bind drivers to companies, which among themselves control entry into the market. 

The reforms are, however, also aimed at drivers. Those who receive complaints or refuse to take passengers can be put on a new "black list" that bars them from working in the industry for up to five years.

The city has some 66,000 taxis transporting 1.9 million people every day, according to an estimate by the municipal regulator. The industry employes some 100,000 people.