You are hereHome > Operators > Taxis > Taxi licences > Annual taxi licence release - Sydney

Annual taxi licence release - Sydney

**NEW** Annual Determination made on the number of taxi licences to be released in 2012/13

2012/13 Annual Taxi Licence Determination

2012/13 Annual Taxi Licence Determination - Submissions

Submissions received from customer and industry stakeholders in response to ‘Annual Taxi Licence Release 2012/13: Discussion Paper’ PwC, 31 January 2012:

 

  1. Australian Taxi Drivers’ Association (pdf 138KB)  8 Feb 2012  
  2. Dr Peter Abelson(pdf 33KB)  8 Feb 2012  
  3. Council of Social Services of NSW (NCOSS) (pdf 181KB) 10 Feb 2012  
  4. Edward Ellis (pdf 20KB) 13 Feb 2012  
  5. NSW Taxi Council (pdf 306KB)  14 Feb 2012  
  6. Manly Council (pdf 93KB) 14 Feb 2012  
  7. NSW Taxi Drivers’ Association (pdf 665KB) 14 Feb 2012  
  8. Physical Disability Council of NSW (pdf 228KB)   14 Feb 2012  
  9. John Fan (pdf 50KB)  14 Feb 2012  
  10. Action for Public Transport (pdf 18KB) 15 Feb 2012  
  11. John Lewis (online submission) (pdf 66KB) 14 Feb 2012  
  12. Erin O'Brien (online submission) (pdf 66KB)  14 Feb 2012  

 

Transport for NSW has determined the number of annual taxi licences (other than wheelchair accessible taxis) to be released in Sydney for the year from 1 July 2012.

This determination reflects the improvements in taxi availability and service reliability for customers which have resulted from the 464 additional taxi licences issued in the last 2 years.  The regular annual release of licences has also reduced cost pressures on fares paid by customers.

There is no demand for further fleet growth in 2012/13 due to the economic climate and improvements in existing services and no additional licences will be issued.  57 annual taxi licences will be issued to replace existing licences which were not renewed or are due to expire, including:
• 55 unrestricted licences for 24 hour operation which are reserved for experienced taxi drivers, and
• 2 Windsor/Richmond fringe area licences.

The 55 licences reserved for taxi drivers will be issued to experienced drivers who are, or who have applied to become, accredited taxi operators. This year’s release will continue to provide more opportunities for taxi drivers to be their own boss as owner/operators.

Over the past two years there have been 229 licences reserved only for taxi drivers, with drivers also successful in applying for the majority of other licences available.

The determination was based on consultation with customer and industry groups, as well as an analysis of passenger demand, service performance, demand for new licences and industry viability. The licence tenders will take place in the next few months.

To support the continued improvement in these essential services, annually renewable Wheelchair Accessible Taxi licences will continue to be available on application for $1,000 per annum.

To receive further information and updates: send an email to taxilicence@transport.nsw.gov.au 
 

In making the determination, Transport for NSW must General consider factors outlined in s32C(3) of the Passenger Transport Act 1990 including:

  • Likely passenger demand and latent demand for taxi-cab services
  • The performance of existing taxi-cab services
  • The demand for new taxi-cab licences
  • The viability and sustainability of the taxi-cab industry
  • Any other matters Transport for NSW  considers relevant, having regard to the objective of ensuring improved taxi-cab services.

Background to the drivers of taxi licensing reform

Prior to the licensing changes in late 2009, the growth in the taxi fleet had generally not kept pace with demand for services, despite there being no cap on new licences since 1990. A contributing factor to this slow growth take up was the cost of obtaining a new licence had been higher than lease rates on the open market.

Licence values and lease returns have varied significantly over the years due to many factors including market demand, economic conditions (particularly unemployment) and changes in regulatory activity. However, transfer values had climbed significantly in the recent years prior to the reform.

Operators were facing difficulties in servicing increasing licensing costs, when licence values and lease rates continued to increase. In June 2009, the Independent Pricing and Regulatory Tribunal estimated that licensing costs had increased by over 8% in the previous year and represented the second largest cost of operating a metropolitan taxi.

This led industry groups to call for sustainable fleet growth to better match passenger demand and for stabilisation of the past growth in licensing costs to more certain and affordable levels.

Taxi licensing changes from December 2009

On 14 December 2009, legislation came into effect to help achieve the following objectives:

  • Ensure that the supply of taxis responds more closely to growth in passenger demand for taxi services
  • Balance the need for a more affordable means of entry into the taxi market with the need to avoid unreasonable impacts on existing licences holders
  • Reduce barriers to entry and encourage competition
  • Place downward pressure on fares over time
  • Simplify existing taxi licence structures.

Transport for NSW must determine before 31 March of each year  the number and class of new annual licences to be released in Sydney for the year commencing 1 July (excluding wheelchair accessible taxis). The first Determination was made on 30 March 2010.

This supply-based model enables Transport for NSW to determine the number of annual taxi licences to be released each year in Sydney.

Key features of the annual taxi licence are:

  • The licence will be easily renewable each year so that it can operate up to a maximum of 10 years, subject to compliance with normal operating standards
  • The annual licence fee will remain the same as the price bid for the 10 year period
  • The licence can be leased (but must be operated by an accredited operator)
  • The licence cannot be transferred (sold).

In making the determination, Transport for NSW will take into consideration factors including:

  • Likely passenger demand for taxi services, including latent demand
  • The performance of existing taxi services in meeting passenger needs
  • Maintaining a sustainable and viable industry
  • Levels of market interest in the new licences
  • Any other matters Transport for NSW may consider relevant to ensure improved taxi services.

Transport for NSW may also decide to target the issue of a certain number of licences at drivers to provide a career path, or may restrict the total number of licences taken up by any one person or entity in the interests of promoting competition.

Transport for NSW may then determine whether the licences will be issued by public auction or a sealed tender process. This means that, rather than Government setting the licence fee, anyone wanting a new taxi licence is able to bid the amount they are willing to pay. All licences in the 2010/11 and 2011/12 licence release process were issued by tender.  The tender process establishes  the annual licence fees for each of the licences being offered. The highest bidder for each licence is notified and given the opportunity to complete the application process to be issued with an annual licence.

The annual renewal of the annual licence will be at the same price for 9 years (that is 10 years in total). At the end of this 10 years in operation, licence holders will need to apply for a new licence through the public auction or tender process if they want to continue holding a taxi licence.

To encourage competition and prevent market dominance, the reform allows Transport for NSW to limit the number of licences any one body or related body can take up.

No further 'ordinary' transferable or short-term licences can be issued in the Sydney Metropolitan Transport District.

Non-transferable, annually renewable Wheelchair Accessible Taxi (WAT) licences will continue to be available on application at $1,000 per annum in Sydney and other metropolitan areas WAT licences will continue to be at no cost in country areas).

The new licensing arrangements have commenced initially in the Sydney Metropolitan Transport District, Further consideration will be given to introduction to Newcastle, Wollongong, the Central Coast and country areas. New 'ordinary' and short-term licences for taxis to operate in these areas can still be issued.

2010/11 Annual Taxi Licence Determination

2011/12 Annual Taxi Licence Determination

Existing transferable taxi licence lease values

Historically, licence values and lease returns have varied significantly due to many factors including market demand, economic conditions (particularly unemployment) and changes in regulatory activity.

Transport for NSW does not, and has not, guaranteed the value of such licences (see Important Notice regarding licences). However, the reform package is intended to minimise impacts on taxi licence values by determining the number of licences to be released at a level that encourages gradual sustainable growth. The price for these licences will be set through an open market process such as a public auction or sealed tender.

Wheelchair Accessible Taxis

To support the continued improvement in these essential services, annually renewable WAT licences will continue to be available on application for $1,000 per annum.

Tags: 
Taxis
Last updated 02 April 2012