Page 3765 - Week 12 - Wednesday, 28 October 2015
Motion agreed to.
Taxis and ride sharing
MR COE (Ginninderra) (4.04): I move:
That this Assembly calls on the ACT Government to respond to the devaluation of perpetual taxi plates brought about by the Government’s ride share policy.
My motion today is simple but necessary. The Canberra Liberals firmly believe that the taxi industry plays a vital role in the provision of transport in the ACT. We do not say that the industry is perfect, nor do we say that the regulatory regime is perfect. However there must be some acknowledgement that there are thousands of Canberrans that depend on the industry for their livelihood and any policy changes will have serious financial and personal ramifications. In saying that, I welcome to the Assembly today a representative of the industry and also the owner of perpetual plates. I also welcome those who are watching via the web.
The opposition are not opposed to ride share services. We believe that there is a place for such services. However there has to be a level playing field. Unfortunately the ACT government has done the very opposite. It has created a situation whereby many, if not all, taxi plate owners will be in a worse position as a result of these changes.
The changes brought about are not gradual. They are sudden. With the stroke of a pen, Mr Barr’s signature on a regulation, we will see return on investment for perpetual plates plummet. Whereas presently the return on investment is $20,000 per year, the current annual lease rate, the amount will fall to $10,000 and a year later to $5,000, assuming that they are taken up. Therefore the return on investment will halve and then halve again. If the price to earnings ratio remains the same we can assume that the value of a perpetual plate will quarter; 75 per cent will be wiped out. Further to this, with the uncertainty in the sector, even at a quarter of the price plates may sell for even less if they sell at all.
As the government’s own discussion paper shows, the value of perpetual plates traded over the last 10 years has been well over $200,000. In fact, in 2014, just last year, eight plates were sold at an average cost of $244,900. That means if the value of these plates has gone down by 75 per cent, approximately $1.5 million has been stripped from families in last year’s purchases alone. Like many investments, return consists of two components: an annual return which is the equivalent to a divided and a capital gain or a capital loss in the value of the plates over time. Both have taken and will take a hit.
Taxi owners will receive less income and therefore the value of the plate will go down. Between 2004 and 2014, 146 plates were sold. They were sold as a commodity for approximately $250,000. It is easy to say this in a speech in the Assembly or in the Chief Minister’s office. It is easy to think these are just arbitrary figures. However my