Reasons for Recent Booking Difficulties and Price Surges for Private Hire Vehicles
Ministry of TransportSpeakers
Summary
This question concerns the causes of booking difficulties and price surges for point-to-point transport and the potential liberalization of carpooling regulations. Mr Saktiandi Supaat asked about demand and supply factors, to which Minister for Transport Mr S Iswaran noted that active driver numbers fell 18% during the pandemic while daily demand rose by 30,000 trips following the easing of safe management measures. Minister for Transport Mr S Iswaran explained that the resulting fare surges and booking issues are being addressed as the market adjusts and vocational license applications increase. Regarding carpooling, he stated there are no plans to increase the daily two-trip limit because such trips are intended to be incidental and non-commercial. This ensures that private car owners operate on a cost-recovery basis, while commercial ride-sharing continues to be managed under the existing point-to-point regulatory framework.
Transcript
75 Mr Saktiandi Supaat asked the Minister for Transport (a) whether the Ministry has conducted any studies to identify the respective demand-side and supply-side causes of recent booking difficulties and price surges of private hire cars and taxis; and (b) whether the Ministry will consider liberalising current regulations limiting private motor cars to two paid carpooling trips a day.
Mr S Iswaran: Since January 2020, the number of active taxi and private hire car (PHC) drivers has fallen by 18% to about 57,000 drivers as of June 2022, in response to lower demand for point-to-point (P2P) transport during the COVID-19 pandemic. This was despite the Government setting aside more than $530 million for P2P support measures such as the COVID-19 Driver Relief Fund and the Special Relief Fund.
Demand for P2P services has picked up sharply after community safe management measures were eased in March and April 2022, including the reopening of international borders and the return of all employees to workplaces. Daily P2P trips have increased by 30,000 in June 2022 compared to February 2022. However, the number of P2P drivers has not increased as rapidly as demand and this has resulted in fare surges and booking difficulties.
Like other sectors, the P2P sector will require time to adjust to the surge in demand after COVID-19 restrictions were lifted. We are seeing signs that the market is responding. Vocational Licence applications have increased recently, and some drivers who left the P2P sector may progressively return in response to the higher demand. These will boost the supply of P2P drivers in the upcoming months.
Carpool trips are incidental and non-commercial in nature, and this remains the case today. As private car owners typically take two trips a day – to and from home, the current regulatory regime allows private car owners to charge at cost-recovery basis for up to two trips a day. We have no plans to change this limit as existing avenues, such as the P2P framework, are in place for drivers to provide ride sharing services which are commercial in nature.