A blog on issues affecting Australia's newsagents, media and small business generally. More ...

Why are governments handing taxi drivers compensation for deregulation?

I was shocked to hear the number $800 million bandied about on radio in Melbourne Friday as the amount that may be paid to Victorian taxi drivers in return for deregulation in the face of competition from Uber. Any amount paid to taxi drivers is wrong in my view.

Then, I discovered the $20K reportedly paid to NSW taxi drivers and the $100M transition package for Queensland taxi drivers.

It reminded me of the hundreds of millions of dollars a year compensation for the TV networks from successive federal governments so the TV networks could deal with technology changes, right at the time of increased competition for them.

Back in 1999, small business newsagents had their exclusive territory ripped from them by the Howard government. No compensation was paid. I estimate that at least $500,000,000.00 was wiped from the value of the newsagency business assets as a consequence of the deregulation. I suspect the cost was more than the $.5B I estimated.

Some of the write down is being felt today as long-held businesses are sold.

Yet no compensation was paid to newsagents.

Compensation had been paid years earlier as the federal government forced the sale / closure of pharmacies as Australia had too many.

But no compensation was paid to newsagents.

The newspaper publishers and magazine publishers at the time offered no support of small business newsagents in pursuit of compensation. Some of those parties involved were robust in representations to government seeking compensation for TV networks.

Bow we see the generosity of state governments, conservative and labor, to taxi drivers to help them deal with deregulation.

Newsagents have every right to feel aggrieved.

On the politician side those around at the time of deregulation said newsagents were poorly represented. Maybe so but I would have expected greater care for newsagents than taxi drivers given the role back then of the local newsagent in the community versus the role of and respect for taxi drivers today.

With this latest taxi driver news it is clear newsagents were dudded. While there is nothing for today;s newsagents to gain, it is a reminder of how useless politicians are when it comes to representing their constituents. They look after themselves and their closest mates first followed by those who they feel could do them harm. Newsagents never made it into that top three.

If I had a say, I’d pitch that taxi drivers get no compensation for deregulation. You can’t have a free market, a global market and offer compensation. But, then, we don’t have a truly free and global market – only when it suits vested interests.

22 likes
Newsagent representation

Join the discussion

  1. ken

    How come we as a newsagent dont get COMPENSATION,as supermarkets sells magazines ,stationery and other things?

    0 likes

  2. Colin

    Don’t get me started. Politicians over paying by tens if billions to build submarines in Adelaide. Would have been far better to spend on infrastructure and emerging industries.

    0 likes

  3. James

    Whats another Billion between friends.

    Victorians will now borrow and fork over the best part of 1 Billion dollars for the privilege of legalising ride sharing in Melbourne.

    Thats on top of the 1.4 Billion for not building the bypass and the 1 billion a year to not supply any water from the desal plant.

    Thats money we dont have and are essentially stealing from our kids and grandkids in return for a big fat nothing.

    2 likes

  4. Steve

    I wasn’t a newsagent till long after deregulation so I dont know the ins and outs of what went on. However unlike Taxi plate owners who have been fleeced by state governments through sale of taxi plates and high rego and licencing I dont believe newsagents were being charged a special fee by government for the right to be a newsagent. This is why having allowed an unlicensed competitor into the taxi industry state governments now find they have no choice but compensate the owners of taxi plates.

    4 likes

  5. Mark Fletcher

    Steve, purchasers paid a premium because the entry was difficult and territories protected. Those who paid the premium lost this value when deregulation came on.

    1 likes

  6. eric

    i knew someone paid $200k each plate for 10 of them , ouch!
    I will never buy goodwill for anything for now or licences that worthless in few years.

    0 likes

  7. Peter

    Over 10 years ago Taxi Plates where seen as an excellent investment for retirement income. A healthy guaranteed percentage derived from the taxi plates cost plus profit all paid by their lease to a taxi operator. Not now.

    0 likes

  8. Sam

    I heard from a private limo driver that he paid like $500k and now the QLD government is only going to compensate them like $10k. It is kind of like pity money when you put that into perspective. Although newsagents didn’t get any compensation I feel for the poor taxi drivers and any business that get dudded by government. These uber drivers don’t have insurance requirements, proper police checks and everything else that the taxi drivers have to go through. Imagine get driven around by a psychopath. I can’t see myself being driven by a uber driver anytime soon.

    1 likes

  9. Mark Fletcher

    Sam the governments have not dude them, the world has. Nothing stands still in business. There is no exclusivity. It should be one rule for all including taxi drivers and TV networks – you pay your own way.

    I have no love for taxi drivers in Australia. The majority I ride with do not provide a good service.

    2 likes

  10. Paul

    Sam , you would be surprised to find that more than a few Taxi drivers didn’t pass their ID checks either. Some drive on “friends” licences or look a like drivers licences. I have a female friend who had a very close call with a Taxi driver a few years ago who attemped to abduct her. The Police actually charged this grub.

    Having a friend who spent 30 years in the Taxi Industry I could tell you some stories about what gos on and how a certian group even played the ethnic discrimination card to get at least one driver who probably wasn’t fit to be a Taxi driver passed.

    All Uber for me if I need that service. They are polite. The vehicles are all clean and I know exactly who is picking me r more importantly my wife up.

    1 likes

  11. hzhousewife

    The answer to Mark’s question is “Because the loudest lobbyists got the governments ear, and more than a few old politicians own taxi licences”.

    0 likes

  12. Henry Henderson

    When governments set laws with which the contractors must comply, then the government is a party to the contract. If the government changes the conditions under which contract was agreed, then the contract is meaningless under the new regulations.
    If one of the contractors breaks the agreement – under the regulations it was agreed – then the other contractor is entitled to damages. If the government changes the regulations, it, as a party to the contract, should be liable for the damage to the other parties.

    6 likes

Leave a Reply

Your email address will not be published. Required fields are marked *

Reload Image