Proposed $1 taxi surcharge to compensate drivers for Uber

Article by James O'Doherty via The Daily Telegraph

Compensation payments for NSW taxi licence owners whose livelihoods took a hit from Uber could increase from $20,000 to $200,000 under a proposal being developed by the NSW government.

​The $1bn package, developed in consultation with the industry, will be considered by Cabinet’s powerful expenditure review committee.

The dramatic increase in payments would be funded by an extension to the $1 passenger service levy, currently applied to every trip in a taxi or ride-sharing car.

It was introduced in 2018 as a temporary measure to help the struggling industry.

The value of taxi licences plummeted when ride-sharing services like Uber entered the market.

In 2016 then-transport minister Andrew Constance announced a $250m package to support the industry, giving licence holders $20,000 in transitional payments.

David Elliott, who took over the transport portfolio last year, has told the industry he did not believe the relief measures went far enough.

Earlier this month, Mr Elliott assured taxi drivers through a budget estimates hearing that the government “has got their back”.

He has told parliamentary colleagues that his first priority in the role was to ensure families who have had their livelihoods and assets trashed are given some dignity given that Uber has radically changed the market.

“I am very conscious of the fact that they, through no fault of their own, have lost the value of a business and, in many respects, tragically, that includes the life savings of families,” he said.

Senior sources indicated that given the position of NSW’s finances, any new budget proposals would be unlikely to pass the expenditure review committee unless they were offset by cuts or extra revenue measures.

That means unless the compensation proposal is fully funded through an extension to the passenger service levy, it is unlikely to be accepted.

​There are about 5000 taxi licence holders in NSW.