When the public hearing on raising taxi fares opened in Beijing
yesterday, there had already been ample public input via numerous
media reports in the past week.
The time limit of the hearing predetermines that no answer will
be immediately offered to questions raised by the public.
However, whatever the final fare increase will be, the merit of
the decision made by local pricing authorities hinges on whether
they've given an attentive ear to public opinion.
A city-wide campaign to crack down on unlicensed taxis was
launched by local authorities just days before the hearing.
In itself, such an act is long overdue to restore order and fair
competition in the taxi industry.
Unlicensed taxis have undercut their licensed counterparts with
competitive pricing and sometimes using illegal means while
exposing passengers to higher transportation risks.
Strengthening the regulation of the taxi industry with a heavy
hand over unlicensed taxis is indeed good for the safety of
passengers.
Nevertheless, if it is meant to mollify taxi drivers' fears of
raised fares that might potentially drive passengers further toward
their unlicensed competitors, such a stopgap measure simply shows
that local authorities have failed to grasp what the public is
saying.
Had it not been for public skepticism about taxi companies'
allegedly huge profits, a price hike in taxi fares as a natural
result of soaring fuel prices would have been much more easily
bought by most passengers.
When the public is asked to join the government's effort to help
share the burden that higher oil prices impose on taxi drivers, it
is unthinkable that the taxi companies could be left intact as the
tabled price hike proposal suggests.
The public hearing should have been a chance for taxi companies
to clarify doubts about their financial conditions. Unfortunately,
media suspicion and criticism invited by their financial reports
indicates otherwise.
According to their statement, taxi companies only earned a very
slim profit margin although, by monopolizing taxi licenses, they
collect a de facto license fee of up to 5,200 yuan (US$650) a month
from every taxi driver who, meanwhile, makes only 2,000 yuan
(US$250) a month.
Yet findings were widely reported that management costs had been
improperly inflated. And that the basic salary deducted before taxi
drivers' payment to the companies was recalculated to lower the
nominal profit margin in these financial reports.
The public has a right to know if there is any creative
accounting in materials provided for the hearing. Misleading
information will not lead to fair policy-making.
If strong public support is deemed crucial to justifying a rise
in taxi fares, policy-makers should first have taxi companies clear
up questions raised by the public before they endorse any price
adjustments.
(China Daily April 27, 2006)