Ride-sharing leads to unknown social and economic destinations

Driverless option could be just down the road for Uber

We live in interesting times. Smartphone app technology is delivering a remarkable reshaping of our economy. With smart technology we see more consumer choice, exciting new companies and high-tech jobs. In certain sectors we also see the erosion of existing local jobs as new app-enabled businesses out-perform the existing ones, which grew our economy and support our society. It is far from being a Luddite to ask, what can reasonably remain for employment in local service companies? Bookstores and video stores have virtually disappeared; checkouts at stores are endangered and newspapers and libraries are cutting staff. As a society, should we have concern that good jobs with local businesses are being replaced by the slimmer offerings of offshore mega technology corporations?

Consumers are rightly excited by new choices. Early enablers such as Amazon, Google, Facebook, Netflix, Twitter, and the banks provided online services for networking, information, shopping and financials. Smart apps empower the new sharing economy for ride-share, bike-share, house-share, deliver-share, edu-share, medi-share and more. These enable new less regulated, lower-cost entrants into long-established service markets. AirBnB provides more choice and lower costs for consumers and extra income for homeowners. On the flip side it also reduces long-term rental housing and challenge the economics of B&B and hotel industries. For governments, the difficulty in the sharing economy is to balance our desires for new businesses offering greater consumer choices today and with the economic and societal resilience needed tomorrow.

For further insight into the sharing economy let’s examine transport, which is undergoing a technology revolution. Predicting the arrival of millions of driverless electric cars by 2020, Uber Taxi CEO Travis Kalanick reports plans to purchase 500,000 of Tesla’s self-driving cars. Imagine Uber with driverless cars. We understand that 25 per cent of Uber’s revenue today goes offshore with no taxes paid in Canada. Tesla CEO Eldon Musk says he is working on new driverless e-vehicles that will replace public transport. How do we manage the pace of this change and balance its social impacts? What will we do with the people who drove vehicles for a living?  How are schools and hospitals paid for with lost taxes?

Given the impacts of ride-share on the taxi industry, Minister Peter Fassbender reports the province is undertaking its first review of the Passenger Transportation Act in 30 years. This review will look at provincial and municipal taxi licence regulations and public transit. The minister is seeking input from local governments, businesses and the taxi and ride-share industries.

It is 2016. Elected officials welcome the innovations of smartphone technology. It seems appropriate, however, that ride-share businesses are regulated, taxed, licensed, insured and monitored on the same basis and to the safety and fiscal levels of any public-transport company. Environmental standards and requirements to provide services for the elderly, physically disabled, minors and lower-income residents must be upheld or enhanced.

The taxi industry is regulated for public safety, market sustainability and fiscal accountability. Deregulation of the taxi industry was tested in a number of jurisdictions in the 1970s and 1980s. Deregulation was linked to over charging, lack of vehicle maintenance, and poor service levels.

Within B.C., the Passenger Transportation Board (PTB) issues taxi licences based on its analysis of market sustainability. An unregulated ride-share market destabilizes the economics of a sector in which taxi owners have heavily invested to meet PTB regulations.

A taxi licence represents “buying a job” based on existing regulations. Elected officials need to provide a level regulatory playing field for both taxi and ride-share drivers. Responding with innovations, B.C. taxis are preparing to launch the eCab app that will connect passengers to every taxi company in the province, reduce wait times, enable credit card payment, rate their driver and provide GPS tracking.

In our region, taxi operators receive permits from the Victoria Police Department. They undergo a twice-annual safety check, annual criminal background checks and an initial knowledge test. In Saanich, taxi operators who take their “commercial” vehicles home are subject to our zoning bylaw and home occupation use regulations. These indicate that only one commercial vehicle used in a home occupation can be stored or parked on the lot in an unenclosed manner.

Do we need to change our bylaws to accommodate a ride-share driver’s commercial status? With Uber Taxi’s plans to go driverless in 2020, should we ask what are tomorrow’s economics for the drivers Uber is hiring and displacing today? Are there consumer questions on Uber’s plans for surge pricing at peak times? As we look at a driverless ride-share economy should we think about the landscape of the unknown destination we will arrive at? The Saanich Advisory Committee on Planning, Transportation and Economic Development that I have the pleasure of chairing would appreciate input from Saanich citizens. Please contact us at Fred.Haynes@Sanich.ca.

Fred Haynes is a councillor with the District of Saanich.

 

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