Three years ago Calgary City Council adopted a policy of using a Taxi Cost Index to determine taxi rates. Using that Index, administration is recommending to City Council a meter rate increase of 8.1%. Unfortunately the assumptions behind this approach are now outdated: (1) it is an antiquated approach from a time when the industry was not required to share market data, and (2) it predates the arrival of innovations that enhance productivity and profitability, negating the need to raise rates; and (3) it ignores sound economic theory about what happens to demand when you raise rates. New transportation services in other North American cities are driving down the cost of for-hire transport options, proving that taxi rates have been inflated given the predominant business model preferred by taxi brokerages. Calgary City Council should take these factors into account and vote against the motion to raise meter rates at this time. CALL 311 TO LET YOUR ALDERMAN KNOW THEY SHOULD NOT SUPPORT A METER RATE INCREASE.
Posted on: Sat, 13 Sep 2014 21:06:26 +0000
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