Transport Legislation Amendment (Taxi Services Reform and Other Matters) Act 2011

Outline

The stated purpose of the Act is "...to provide for the reform of the commercial passenger vehicle industry...". In general, the Act establishes a regulatory scheme with the following key elements -

Context

The Victorian Government's pursuit of the Act was driven by concerns about the ongoing poor performance of Victoria's taxi industry and the desire to establish an inquiry and signal long term organisational and regulatory changes.

Announcement

An inquiry into the taxi industry was announced on 28 March 2011 by the Premier of Victoria, Ted Baillieu. The Premier advised that the inquiry would be headed by Professor Allan Fels, the former head of the Australian Competition and Consumer Commission. Mr Baillieu said the Fels Inquiry’s key tasks would include improving disastrously low levels of public confidence, providing better security and support services for drivers and safety for customers, and ensuring drivers were properly trained and knowledgeable.

The media release issued by the Premier announcing the Inquiry reported him as saying that -

Taxi industry problems

The key problems with the current Victorian taxi industry listed by Mr Baillieu in his announcement were -

Inquiry details and ongoing regulatory responsibilities

Reforming the Victorian taxi industry occurred in two stages. Firstly, the Fels Inquiry undertook a comprehensive inquiry into the service, safety and competition issues in the Victorian taxi industry. Secondly, following Professor Fels’ investigation, the Taxi Services Commission took over industry regulation with the powers and tools necessary to drive reform in the taxi industry.

The previous taxi industry regulator, the Victorian Taxi Directorate (VTD), continued to operate as normal until the Commission was established. During the second stage staff and resources from the VTD were moved to TSC once it assumes the ongoing role of regulator.

Parts

The Transport Legislation Amendment (Taxi Services Reform and Other Matters) Act 2011 is divided into four parts -

1. Preliminary
2. Initial Amendments
3. Post Inquiry Amendments
4. Repeal of Amending Act

The substantive parts of the Act are Parts 2 and 3, while the remaining parts are predominantly formal. The Part 2 amendments are now in force. The Part 3 amendments are yet to commence.

Inquiry phase

The Act establishes a new Taxi Services Commission as a body corporate. In its initial incarnation, the Commission is responsible for conducting an inquiry into the taxi industry and the wider small commercial passenger vehicle industry. The Commission is then required to report on those matters including by making recommendations about how the commercial passenger vehicle industry should be structured and regulated.

The initial changes have broad scope. They enable the Commission to not only investigate traditional matters relating to vehicles, drivers, licences and the like but also a wide range of ancillary matters such as the supply of relevant goods and services in the taxi and broader small commercial passenger vehicles industry.

This breadth facilitates the investigation of provision of electronic and other payment systems for the payment of fares and charges, suppliers of booking and dispatch systems, driver protection screens, taxi fit outs, taxi meters and sealers, security cameras, panel beating, vehicle repairs and maintenance, finance and banking services, licence and insurance broking, bureau services, call number services, taxi ranks, and vehicle consumables such as fuel, oil and tyres. These matters are thought to be important in the current monopolistic and coercive practices evident at present in the Victorian taxi industry (see Taxi Industry Inquiry).

In its second phase, the Commission is positioned as the Victorian Government's regulator of taxi services and other small commercial passenger vehicles. This role will require the TSC to, among other things, administer any licensing and accreditation schemes and conduct compliance and enforcement and other activities.

Constitution

The Commission consists of a Chairperson and up to two Commissioners. Professor Allan Fels has been appointed as Chairperson and Dr David Cousins AM as a Commissioner. Provision is also made for staff to be engaged by the Commission to assist it in its work. The Commissioners in the Commission's initial inquiry phase are not automatically transitioned to manage the Commission when it assumes its role as a regulator as fresh appointments are required.

Transport Integration Act

The Transport Legislation Amendment (Taxi Services Reform and Other Matters) Act amended the Transport Integration Act to provide the TSC with a governance framework - the objects, functions and powers - which comprise the charter of the agency.

Object

The Transport Integration Act provides that the object of the Commission in its inquiry phase is to

Functions

The function of the TSC includes -

Desirable considerations

In performing its function, the Commission is required to consider the desirability of -

Provisions triggering inquiry

It is not sufficient for the Commission merely to be established for it to conduct an inquiry. It must also have matters formally referred to it by the Minister for Public Transport before it can commence its inquiry duties. Accordingly, the Act amended the Transport (Compliance and Miscellaneous) Act to make provision for the Minister to issue a notice specifying the matters to be investigated, the nature of the Commission's reporting on its investigations and other relevant matters.

General

The TSC is generally able to conduct its inquiry in the manner it considers appropriate. A number of requirements and signals are included in the legislation, however, requiring initial and ongoing consultations The Commission's procedures are informal - it is not bound by the rules of evidence and may inform itself as it considers appropriate. In addition, the Commission is empowered to conduct hearings in public or in private and may determine whether a person can appear at a hearing and be represented by another person.

Requiring information and documents

The Act allows the Commission to require a person to provide information or a document to the Commission if the Commission believes on reasonable grounds that -

The Commission may also require the person to appear before it to provide the information or the document.

It is an offence to not comply with these requirements. A person must also not provide false or misleading information or to interfere with another person's actions in pursuance of the requirements.

The privileges against self incrimination and client legal privilege apply in relation to requirements to provide information or documents.

Confidential or commercially sensitive information

The Act establishes an elaborate scheme relating to the Commission's handling of confidential or commercially sensitive information. Restrictions apply on the Commission's disclosure or use of sensitive information. Similarly, freedom of information exempt information is also subject to a number of specific requirements and procedures.

Reporting

The Act make provision for the Commission to issue three types of reports: interim reports, special reports and a final report. The provision must divide reports and if the report contains sensitive information and information from FOI exempt documents, the report is required to be appropriately divided.

The Commission's final report must be laid before Parliament and be made publicly available. The Act also requires the Minister to cause a review of the taxi and small commercial passenger vehicle regulation provisions of the Transport (Compliance and Miscellaneous) Act 1983 once the final report has been released and recommendations are available. The review must be completed within 12 months of the report being laid before Parliament.

Independence

The TSC is independent of Ministers and Government generally in its initial inquiry phase. No provision is included for the Commission to be directed during this period. This changes during the second phase when the Commission is subject to the standard powers of direction available to Ministers.

Transfer of taxi regulatory responsibility to the Department of Transport

The Act transferred regulatory responsibility for taxi regulation from the Director of Public Transport to the Secretary of the Department of Transport. This step occurred as an interim measure prior to the eventual transfer of the function to the Taxi Services Commission on completion of the current Taxi Industry Inquiry. In the interim, the function is exercised by the Victorian Taxi Directorate on delegation from the Secretary.

Post-Inquiry Amendments

Part 3 of the Act will make a number of changes following the completion of the current Taxi Industry Inquiry. For example, the Taxi Services Commission is conferred with a new object and functions in preparation for its commencement as the regulator of taxi and other small commercial passenger vehicles in Victoria.

Object

The primary second phase object of the Commission provides that the agency should concentrate on regulating the relevant industries consistent with the vision statement and transport system objectives set out in the Transport Integration Act 2010. A number of specific matters which are taken to form part of the primary object are then listed comprising -

Functions

The Taxi Services Commission is conferred with a range of new functions by the Act when the Commission undertakes its second phase. The Act provides that the functions of the Commission are to -

The changes specifically provide that the functions of the Commission do not include a function to develop strategic policy and legislation. These functions are instead reserved for the Department of Transport to avoid the conflicts of interest involved in regulators performing both policy and legislative tasks.

Other provisions of interest

The new Act makes specific provision for the Taxi Services Commission to be subject to general or specific direction by the Minister. A range of other substantive and procedural changes are made by the Act to position the Commission as the regulator of the taxi and small commercial passenger vehicle sector.

Commencement of the TSC as taxi regulator

As indicated, legislation has been passed by the Victorian Parliament which establishes the Taxi Services Commission as the regulator of the taxi industry and other small commercial passenger vehicles. However, the Victorian Government has indicated that as designed these requirements will not come into operation until after the conclusion of the current Taxi Industry Inquiry. The legislation itself provides that unless triggered by proclamation to commence earlier, these changes will operate automatically on 1 July 2013.

Introduction

The Act was introduced into the lower house of the Victorian Parliament, the Legislative Assembly, on 31 May as the Transport Legislation Amendment (Taxi Services Reform and Other Matters) Bill 2011.

The responsible Minister for the Bill was the Minister for Public Transport, the Hon Terry Mulder MP. The Minister moved the second reading of the proposal on 2 June 2011 and set the context for the Bill in his speech as follows -

The Minister then spoke about the role of taxis in the overall transport mix and also commented on the Victorian public's expectations of taxi services -

The Minister then commented on the specific measures effected by the Bill -

The Minister concluded his speech in support of the Bill by stating that -

Passage, assent and commencement

The Transport Legislation Amendment (Taxi Services Reform and Other Amendments) Bill was passed by the Legislative Assembly on 16 June 2011. The Bill was introduced into the Legislative Council on the same day. Second reading was moved immediately. The Bill was ultimately passed without amendment on 30 June 2011.

The Bill received the Royal Assent on 5 July 2011 to become the Transport Legislation Amendment (Taxi Services Reform and Other Amendments) Act 2011. The Act was partially proclaimed to commence on 19 July 2011.

Changes to the Act

No significant changes have been made to the Act since it was passed.