Taxi Fares is the cruz of the matter

This letter was sent to the Straits Times on 3 February 2012 but was not accepted for publication.

The Minister for Transport announced in Parliament that the Government will regulate the standard of service for taxi drivers but will not regulate the fares. I recall reading an editorial in the StraitsTimes which politely state that regulation of fares is "the crux of the matter".

I understand the reluctance of the Minister to regulate the fares as his Government has, for the past  many years, been promoting the advantages of deregulation of taxi fares to allow greater flexibility in the supply of taxis.  


I wish to suggest an approach that can solve the two conflicting goals:

• The Government should regulate the fares for a basic taxi service that picks up passengers on the road or at taxi stands
• Taxi companies can operate special services for customers that book a taxi at their call centre; they can set their own fares

This approach will allow the taxi companies to participate in the basic taxi service without  incurring the high cost of setting up and managing a taxi booking operation. It will be easier for  new taxi companies or even taxi cooperatives to be set up to run the taxi service - hence  achieving the goal of greater flexibility in the supply of taxis. The taxi cooperative may be able to serve the needs of the taxi drivers better.

Commuters will also benefit as the fares for the basic taxi service can be used as a benchmark to decide on the taxi company to choose for call a taxi. Tourists will not be baffled by the myriad of taxi fares and surcharges.

Tan Kin Lian