From Roger Bale.
THE taxi is the only form of public transport which can serve any address in the Island.

In Jersey we do not limit the number of school teachers; we ensure they are properly qualified. We do not limit the number of hairdressers; customers decide who suits their needs best. We do not limit the number of lorries; it’s just that they must conform to standards and sizes and the drivers must be suitably qualified.
Why is it, then, that we limit the number of taxis?

Clearly at certain times of the day, as evidenced by queues, there are insufficient taxis available. Excess demand has a high cost, both because that trade which does occur is inefficient and because much trade does not occur at all. The former involves longer waiting times and probably higher fares. The latter leads to increasing the use of private cars, undermining campaigns against drinking and driving, and other effects. There is also the spin-off effect on the restaurant, nightclub and licensed trades, thus contributing to their decline.

The main rationale advanced for the restriction is that increasing the margins earned by plate-holders encourages them to behave more responsibly, leading to a safer and higher-quality service. There are problems with this argument. First, other policy instruments, such as enforcement of quality standards, may be more effective. Second, the increased margins get eroded away by the spiralling ‘worth’ of plates to those who seek them.

The economic literature on taxi regulation suggests that fare controls are necessary to avoid overcharging, but that controls on entry are not required. Many cities do not have controls on entry. Among these, the most positive experiences are reported from those where fare controls are maintained. The only systematic problem that has accompanied entry deregulation is that quality standards fall as the market expands. However, this is a reason for improved quality standards, rather than an argument against removing entry controls.

The existing regulatory system has failed. It has prevented the supply from growing with demand, as it should. This failure will continue as long as entry is regulated, even if new plates are issued. Ironically, the issue of more plates may perpetuate the problem, because it may reduce the pressure for the fundamental reform: namely the removal of the entry controls.

Proposals based on the experience of Dublin and other jurisdictions are: l Entry to the market should be deregulated in not more than three years. At that time, any suitably qualified applicant should be awarded a plate. l Fare control should be retained. l Supply should be increased before entry deregulation by awarding a second plate in the same category as the plate already held to each of the current holders with the right to assign their plates or keep them for use with employed drivers, as they wish.

l There should be a user-friendly mechanism for making, receiving and acting upon both complaints and compliments (with Driver and Vehicle Standards as the regulator?). l After entry is deregulated, the regulator should focus on maintaining and enforcing quality standards and fine-tuning fare controls to equate supply and demand. l Private-hire cabs should be subjected to the same quality standards as taxis.

I believe that all these changes can be effected by the minister using powers within the existing legislation.
If these proposals are adopted: l The worst queues would be eliminated by the issue of second plates in both categories. l Existing plate-holders would be compensated for the reduction in the worth of their plates by being able to sell (or keep) one or both plates.

l Using fares to regulate supply and demand in the market would not give rise to such strong interest groups on either side of the market. In particular, with free entry there would be no monopoly ‘rents’ to protect. l Rapid deregulation of entry can be used to increase the number of those taxies that are wheelchair-accessible so that improved service can be provided to disabled passengers.

I wonder why politicians have been ineffective in dealing with this situation. I do not believe it is politicians’ conversations overheard by taxi drivers, but rather that taxi drivers offer a co-ordinated voice and lobby, whereas there is no equivalent taxi users’ platform.

The logic of restricting entry to taxi plate-holders when not restricting entry to haulage, hairdressing or any other consumer providing service is beyond me and is no way favours the public.
Rocque Berg,
Grande Route de la Côte,
St Clement.