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LTA Lays Down The Law On Grab And Uber - Unleashes Measures To 'Level' The Playing Field With Taxis

Perhaps this was the day that taxi companies have been waiting for.

Yesterday evening, the announcement came that private-hire drivers from ride-sourcing service operators like Uber and Grab would now be required to obtain a vocational licence.

This comes after amendments were made to the Road Traffic Act (RTA) in Parliament.

Alongside that comes other regulations that the companies and their drivers would now need to abide to, including giving LTA the power to “introduce and enforce other rules such as ensuring the service operators provide the authority with trip and other fleet-related data to help in transport planning functions”.

Potential Changes Were Already Mentioned Last Year

The idea is nothing new, as it was previously announced last year at the Ministry of Transport’s (MOT) Committee of Supply debate, which saw Senior Minister of State for Transport Ng Chee Meng speaking about how while taxi drivers have expressed their frustration against the competition that came with private-hire arrangements.

Given that the latter aren’t bound by the regulations that taxi drivers are, it was seen as unfair, and there have been multiple calls by taxi companies for the Government to ‘level the playing field’.

Another area of concern raised by Minister Ng was also that the safety of commuters are not as guaranteed when they engage in private-hires, because they don’t go through the safety training, background screening or demerit point system that taxi drivers have to abide to.

Stating that the LTA would introduce a new Private Hire Car Driver Vocational Licensing (PDVL) framework, private-hires would also need to be registered, and have a tamper-evident decal which indicates their PDVL status.

Taxi drivers were also set to see several positive changes.

Image Credit: Vulcan Post

Minister Ng mentioned that many taxi drivers had felt that training curriculum for the existing TDVL (Taxi Driver Vocational Licensing) should be updated to fit current market conditions.

This entails the drivers being taught how to use GPS, and there were also plans for more training to be online rather than off.

Refresher courses that the drivers must attend every six years would also be shortened to three and five hours, from the six and nine-hour sessions.

The revisions to the TDVL were set in place from May 2016.

Announced in April last year, the once-mysterious PDVL framework has finally been set in stone, and private-hire companies like Uber and Grab are due to see pretty big changes.

What Does It Really Mean For Private-Hire Drivers And Companies?

While the announcement did mention the regulations that would come with the amendment, many don’t know its actual implications – both the short and long term ones.

It’s also unclear if the playing field will actually be levelled with the changes.

Regardless, we decided to take a look at the differences between both licenses, and what Uber and Grab drivers would need to do under the PDVL framework.

There is not much updated information about PDVLs at the moment, but a quick check on LTA’s site reveals a table of key features, created back in April last year when it was first announced:

PDVL features from April 2016 / LTA

Vis-à-vis what is stated for TDVL, both are similar in terms of the need for a medical examination, background screening (though not specified for PDVL), the need for a refresher course every few years, and adherence to the Vocational License Points System (VLPS), but some differences stand out:

  • Number of training hours: According to the table, private-hire drivers need to attend a 10 hour long (or so) course. In comparison, rven after the revision last year, taxi drivers need to undergo at least 25 hours of training.
  • Age restrictions: According to the TDVL guidelines, applicants need to be over 30 years of age. PDVL doesn’t seem to have any restrictions on age.
  • Years of driving experience: PDVL applicants need to be holding a license for at least 2 years. TDVL applicants only need a 1 year valid driving license.
  • Street-hailing: Successfully registered private-hire drivers would still be unable to pick up passengers along the street. Taxis would have the option of doing so alongside picking up requests from apps.
  • Licensing fees: Private-hire companies will be exempt from licensing fees “for now” but taxi companies will see their operating licence fees rise to 0.3% of their gross revenue in 2017, up from 0.2% last year.
  • Suspension of operations: Perhaps one of the most contentious parts of the framework, LTA would be able suspend operations of a private-hire company for up to a month if their drivers are convicted of licensing or driving offences. This means that not just the offenders, but all drivers in the fleet would suffer from the consequences.

Uber Responds, Says They Weren’t Consulted About The Changes

When the news came, we couldn’t help but wonder what Grab and Uber, 2 of the largest private-hire companies here, would have to say about it.

An article which came out just over an hour ago answered those queries.

Screenshot from CNA

Reporting that while Uber said that “it is supportive of any effort by the Government to improve the well-being and safety of passengers and drivers, […] it was not given the opportunity to provide input on some of the amendments to the Road Traffic Act”.

In particular, the amendment that will have a private-hire company suspend all its operations if 3 of its drivers are found committing licensing or driving offences.

Said Uber Singapore’s general manager Warren Tseng, “This penalty would not only affect operators, but would also impact the tens of thousands of other hardworking driver-partners who are not to blame for the mistakes of just three other driver-partners. […] Hundreds of thousands of commuters would also be affected; especially those who have come to rely on Uber rides as a vital part of their commute.”

Stating that Uber will “continue to review the amendments to better understand the implications”, he added:

“When industry players are engaged, the result is often a better outcome that simultaneously meets the regulator’s objectives, whilst safeguarding those of other stakeholders, in this case private hire car drivers and riders, and moves the industry forward as a whole.”

This claim is interesting to note, as just last year, Uber’s stance on the new rules was pretty positive, saying that it was “pleased” that the Government had “adopted many of our existing world-class safety standards in these new regulations”, such as pre-screening and robust driver skills training, and fits well into the company’s stance that passenger safety was “the single most important thing” for the company.

Perhaps, then, it’s the addition of the rather daunting potential of suspension that comes as a nasty surprise for them.

On the other side of things though, Grab seems to be taking the amendments pretty well, with their spokesperson stating, “Our goal is to provide the safest transportation platform for users, while ensuring Grab driver-partners continue to earn sustainable incomes – and we are in favour of bill amendments that complement this mission.”

Image Credit: Campaign Asia

The spokesperson also mentioned that their “‘robust’ driver registration process, vehicle inspection framework and relevant internal processes” are well in place to support the changes.

Clever move there, Grab.

Will This Really Level The Playing Field?

It’s too early to say, but the amendments seem to be more skewed towards regulating vocational drivers (in particular, private-hires) on the road and less about making the situation better for both types of drivers.

Perhaps the strict regulations would deter more from hopping into the private-hire industry, thus reducing supply of private-hire cars on the road and potentially increasing fares, but that’s way too early to tell now.

Watch this space for updates.

Feature Image Credit: CNBC