Driving the Taxi Industry

I don't often hire taxis in Singapore. Still, I have had my fair share of experience with taxis and not just as a passenger either. Sometime in the early noughties - that's the early 2000s - I worked on a project involving mobile payments in taxis. We worked closely with CityCabs which was at that time still distinct an entity from Comfort. It was a great project which allowed me to interact with taxi drivers and gain an insight into who they are and what makes them tick.

Backtrack some 15 years before that into the decade of big hair, big shoulders and the best music since the 60s and you will find me working shift hours in a credit card company in Sydney, Australia. Our shifts meant the company provided transport to us in the form of taxi vouchers so two weeks out of three when I travelled around midnight I would have a taxi ride home or to work. These rides again gave me a glimpse into the lives of these hardworking Australians and some of my rides and the conversations during them were memorable ones.

I think we tend to look at taxi drivers in Singapore as a homogenous group of semi-crazed lowly-educated foul-mouthed cretins who whine too much and drive too fast. They're often the subject of abuse, ridicule and vitriol.

I have a different view.

The Cabbie throws some shrimps on the barbie
Sometime ago there was a series on Discovery Channel called City Cabs and there was an episode where the host, Michael Krass, visited Sydney. The episode took me back in time to when I was a frequent taxi passenger.

At one point in the episode, the taxi driver invited Michael to his home for a BBQ. How much more Australian could you get right? The amazing thing was 'home' turned out to a be a sprawling suburban house with a large well kept garden where they had the barbie.

Expressing surprise, Michael asked then learnt that the taxi driver started with a single cab he bought and owned outright. He paid one of the taxi companies a fee for the radio service and livery which his taxi sported. When he'd earned enough, he bought a second cab and leased that to a couple of other blokes. Over time, he'd grown that business to a third (or more) taxis and earned a little from those too.

Thats when it hit me - this could never happen in Singapore. Taxis now are almost all owned by large companies. There are few private taxis - identified by their black & yellow livery - around now. It wasn't always like this of course. In the old days taxis were privately owned and operated. Under the guise of improving service standards and reducing cheating and so on, the large taxi companies began to cover the market. And the small-business owner, the taxi driver, got relegated to a bit part in the play.

Now the norm is that taxi drivers hire their taxis from a company, pay for the fuel and other daily costs such as ERP but nothing more. In return the companies service and maintain the taxis to ensure they work well.

What hit me was the realisation that a taxi driver's profession is the single most dead-end job in all of Singapore.

Taxi driver drives down a dead-end
Consider this: in any other job, if you did well, maybe took some course or other, and generally was liked by your boss, you would have a chance at being promoted and thus getting a higher salary. Doesn't matter what job it is - even a rubbish collector could be the driver of the truck one day. Or the supervisor.

A retail sales assistant could be a supervisor then a manager. A petrol pump attendant could work his way up to be a shift senior or more. A mechanic starts as an apprentice and could end up owning his own workshop. Heck, even a barber at the Sri Dewa chain could one day set up his own shop.

But not a taxi driver. His income is dependent 100% on the fares he picks up which are in turn dictated wholly by the amount of time he spends on the road.  It doesn't take a rocket psychologist to work out that this can lead to driver fatigue which in turn can lead to mistakes which cause irritation at the best of times and accidents at the worst.

In no other job are you faced with the same boundaries. Professionals whose fees are determined by their billable hourly rates don't face the me limits - lawyers charge for more than just their fees including photocopies and affixing their stamps on template documents, doctors dispense medication, heck even photographers can do bigger jobs and thus charge more.

Taxi drivers can't take 'bigger fares' as no such thing exists.

Or do they? What about that extra fee you pay when you call for a taxi? Or when you hail one at a certain time or place such as the airport? These 'surcharges' were supposed to make less-desirable routes or destinations more palatable to taxi drivers. Changi Airport was once deemed so far that taxi drivers needed to be enticed there hence this surcharge. With all the new towns now bordering the airport, I would wager this is no longer necessary. My 12-year old apartment is now only 10-15 minutes away from the airport, for example.

With Singapore being so built-up why do we even need to pay to call for a taxi now? By calling we are assuring the taxi company and driver of a fare. He doesn't need to circle, looking for a fare to pick up. He goes where the call was made from and there is a ready fare waiting for him. The companies say the fee defrays the cost of the system. I say with the system they remain competitive and they should view it as a necessary business investment and stop passing these costs onto consumers.

CBD ERP fees are the most unnecessary fees of all. By not making taxis exempt from this charge, the government in one fell swoop went against the grain of all the other incentives. After all, if I were a taxi driver, I too would not spend $3 (or whatever) to go in to the CBD hoping to pick up a passenger who might just make a $4 trip. The fee they have to pay to go in disincentivises drives who are outside the CBD area from entering to pick up passengers who are, really, in abundant numbers.

More and more taxis - except when you need them
Some years ago, in response to complaints there were never enough taxis in the CBD at peak hours, the government through its relevant authority, ministry or commission decided the answer was to issue more taxi company licences. There were two ideas at play here - the idea that increased competition would lead to better quantity and quality of supply and more amazingly, the simplistic conclusion that not being able to hail a taxi at that time = not enough taxis on the road.

There is an idea in management theory which essentially explains that the solution is not always related to the problem. In this one instance, the problem itself is not related to the problem, as it were.
I’ve already said above what would really help match taxis to passengers at key times so I won’t belabour the point. I will however remind you that the very same people who subscribed to the simplistic equation above also came up with the ill-conceived  idea of restricting taxis in the CBD to picking up and dropping off passengers only at driveways and taxi stands. Apparently taxis stopping along the road were a hindrance to the smooth flow of other vehicles such as buses. They back-tracked soon enough to include minor roads. And now that policy seems to have taken a back seat. Thankfully. For it was the single most short-sighted and blinkered idea to come out of the LTA’s brain in a long time.

While I’m going on about the LTA, I remain confused as to why, when it suits them, they and the Ministry of Transport regard taxis as part of the public transport network. And when it doesn’t such as when declining to exempt taxis from the CBD ERP fees, taxis are suddenly termed 'private hire vehicles'. At least this is the answer I got when I wrote in to the papers some years ago to suggest taxis be exempt from ERP charges. Yet when detailing public transport infrastructure, taxis are clearly deemed part of the public transport network.

Is it fair? Or is it just about fares?
I just read that 4 taxi operators have announced they will raise their fares as well - in line with Comfort Delgro’s and SMRT’s move. We all saw it coming and the initial response was for some to boycott Comfort Delgro and SMRT taxis. I feel this merely hurts the guys who have no choice or say in the matter, and doesn't do a thing to resolve the issues.

So what’s the road ahead? Firstly, let's be consistent and recognise taxis as a form of public transport - and let's do away with ERP for taxis. No, we don't have to do so for buses too as they ply fixed routes.

We can continue by cutting out all the other crap - stop all this business of surcharges. It serves no purpose, confuses passengers, and ultimately does nothing for the bottom line of cabbies.

In a country which often defers to ‘market forces’ I’m surprised we have to meddle so much and so I would also do away with the extra fees for taxi rides after midnight. The demand for taxis tapers off late at night as well so the expected reduction in taxi numbers will probably have no impact. Ready customers = ready supply. If need be, encourage the supply by offering rebates on rental or other fees (maybe through a credits scheme) for taxis running a minimum number of past-midnight-hours.

Next, find some way to cap or reduce taxi rentals, perhaps through reducing road tax for taxis - in fact for all Euro IV-compliant diesel vehicles. The taxi companies then simply pass the savings on to the cabbies.

I'm also for bringing back privately-owned taxis. Let individuals own more than one taxi, and manage their service delivery through the methods we already have in place including vehicle inspections.

Lastly, I’m all for doing away with service taxes and bringing back tipping. I believe this is the thing that will finally make our courtesy campaigns work. It will start with some service providers coming across McDonald’s and fake but over time, people will respond firstly by tipping good service then by reciprocating in kind too and notoriously grouchy and rude Singaporeans may just be motivated to change.

How will this impact taxis? Well, if you tipped a cabbie for helping you with your baggage or your child’s stroller rather than staying seated in his cab, it will only encourage cabbies to behave better and this can only be a good thing.