Private-hire COE category ‘possible’ but needs careful study; new measures to stabilise private-hire, taxi supply

HAVING a separate Certificate of Entitlement (COE) category for private-hire cars (PHCs) is possible, but “there are trade-offs that need to be studied carefully”, said Senior Minister of State for Transport Amy Khor on Tuesday (Mar 5).

This suggestion, made by various Members of Parliament, is among feedback related to the longer-term stability of point-to-point (P2P) transport supply, she said during the debate on her ministry’s budget.

The possibility of a separate COE category will be addressed later this year, in the second phase of the Land Transport Authority’s (LTA) ongoing P2P sector review, she added.

The second phase will also tackle issues such as whether operators with a larger market share should be subject to higher regulatory standards.

Announced last September, the review was meant to end in the second quarter of 2024, but will now end by the second half of 2024.

On Tuesday, Dr Khor announced the first phase of regulatory changes stemming from the review, to improve the “availability, reliability and inclusivity of P2P transport services”.

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P2P operators to report disruptions

First, taxi and ride-hail operators will face new standards for managing operational disruptions.

Operators must inform LTA, commuters and drivers within an hour of confirming any “systemic incident” that will impair P2P services, and submit an incident report with measures taken to resolve it.

They must also develop and regularly review contingency plans, with measures to ensure the timely recovery of service and prevent the recurrence of such disruptions.

Separately, operators that intend to exit the P2P market must provide LTA with an exit plan and a minimum notice period of 120 days before surrendering their operator licence, up from 60 days previously.

They must also inform the public at least 60 days before surrendering their operator licence, to give drivers and commuters time to cash out their electronic wallets and transit to other platforms.

LTA will also work with ride-hail operators to make it easier for commuters to indicate if they need a vehicle that can accommodate foldable wheelchairs or has child seats.

Reducing costs for taxi operators

Regulations will be updated to reduce the operating costs of taxis, and rationalise the inspection regimes for taxis and PHCs.

Dr Khor noted that in 2023, street-hail rides formed 12 per cent of P2P trips, down from 23 per cent in 2020. The taxi population fell to 13,600 from 15,800, in the same period.

One reason for the decline in taxis is that they face higher regulatory requirements than PHCs, which means higher operating costs for operators and higher rental rates for drivers, said LTA.

Yet taxis and street-hail services remain important, said Dr Khor. The regulatory regime is thus being updated.

The statutory lifespan of non-electric taxis will be increased to 10 years, up from eight years.

Taxis less than three years old will require inspection once a year, down from every six months. But for chauffeured PHCs which are more than 10 years old, the inspection frequency will be increased to every six months, up from once a year.

Smaller taxi operators will no longer need to maintain call-booking services, as only 1 per cent of all P2P trips are made through these. ComfortDelGro : C52 0%, which fulfils 99 per cent of call-booking trips, will continue to offer the service.

Separately, the effort and cost needed to obtain a taxi driver’s vocational licence will be lowered, to encourage prospective P2P drivers to consider obtaining one.