The Nelson Mandela Bay municipality wants to cap the number of metered cabs operating in the city to 513 – a move which could hit the Uber and Taxify services the hardest.
Bombarded with hundreds of new applications for operating licences, the city wants to place a two-year moratorium on approvals, saying it needs to investigate the emergence of e-hailing services to avoid an over-supply in the metered taxi industry.
The municipality is sitting with 414 applications for operating licences which it has put on hold until there is firm direction on what to do.
In a report to the roads and transport committee, which met on Thursday, infrastructure and engineering executive director Walter Shaidi wrote that, since the emergence of e-hailing services Uber and Taxify, the municipality had been flooded with applications.
The applications come from the Provincial Regulating Entity (PRE), which falls under the Eastern Cape department of transport, and ultimately have to be approved by the metro.
But because the National Land Transport Act does not regulate e-hailing metered taxis, the municipality wants to limit the service until it can be regulated.
“There is no policy in place at the moment at national, provincial and municipality level that fully and specifically defines and regulates e-hailing services,” Shaidi wrote.
“Therefore, until such policies/regulations are put in place, e-hailing services are still regarded as metered services.”
Drawing on the number of metered cabs in other metropolitan municipalities, based on their population figures, the Bay municipality believes it should cap the number of metered cabs here at 513.
There are already 241 approved metered taxis operating in the Bay.
This includes all metered taxis and not only Uber and Taxify. This leaves room for only 272 of the 414 applications now before the city for approval.
Shaidi wrote: “Emergence of e-hailing service[s] within the city has caused an enormous increase in the volume of operating licence applications for metered taxis.
“If action is not taken regarding this, there will be overtrading/oversupply in the metered taxi industry.
“Lack of data that accurately depicts the supply and demand for metered taxis has hindered the city from giving precise recommendations to the influx of operating licence applications that are being referred from the provincial regulating entity.
“Hence about 414 operating licence applications have been placed on hold so far without firm direction on what recommendation to give the PRE regarding these applications.”
Shaidi proposed that the number of licences be capped at 513 as a temporary measure until a full investigation into the industry was carried out.
“The investigation will be able to give information relating to operational pattern, supply and demand, and various problems associated with the metered taxi industry.”
He wrote that the probe could take up to two years to finalise due to a lack of resources.
“It is therefore proposed that a moratorium be placed on the metered taxi operating licences after the additional 272 licences have been approved up until this investigation is finalised.
“This is to prevent service providers from wasting their fiances and applying for operating licences that will not be granted,” Shaidi wrote.
The report was not discussed by councillors at Thursday’s meeting as the meeting collapsed as there was no quorum before the metered taxis item could be discussed.
In the meantime, some Bay Uber operators have been able to use the service by submitting their application receipts – which expire after six months – while awaiting approval.
Uber operator Sandile Klaas joined the industry in early 2018, when applications were already placed on hold.
Klaas is among the 414 operators whose applications are on hold.
“I have had to keep going back to reapply for the licence about three times because Uber blocks you from operating until you have it or submit a new receipt,” he said.
Kevin Chidumwa has been driving his current Uber car for nearly five months and says the owner is still awaiting approval for a metered taxi operating licence.
Although he fears the municipality’s proposal to cap operating metered taxis might affect jobs negatively, he supports the need for regulations tailored for e-hailing services.
“I’m optimistic that something good might come out of the investigation because I believe that, as similar as the goal of e-hailing services and regular metered taxis may be, there is a difference in how we operate.”