When a lot of people want to buy a house with ocean views and a nice address the fairest way to select a buyer is to put that house up for auction. Every person is free to put in a bid, but the one willing to pay the most money gets the house.
Now it seems that this type of trading transaction is about to become the norm for booking a taxi !
The wonderful world of communications - which gave us the mobile phone and is now expanding by way of the I-Pad - has a new app named Ingogo. Intending passengers compete with one another to gain the services of the cab driver by offering an auction style reward for his or her services.
This Ingogo app had been on offer for just eight weeks, and so far a thousand cab drivers have taken up the option - and ominously - 34,000 intending passengers have downloaded the app.
Supporters of Ingogo claim that this is nothing new. At peak times such as New Year's eve, when the streets are jam packed with revellers - getting a cab to go home often means shelling out a hundred dollar tip. This is simply the way the market place decides the law of " supply and demand ". When demand is greater than supply - the price goes up !
On that basis, the cost of any cab fare would be an unknown factor. A $ 20 trip into town could morph into a $ 100 return if Sydney turned on one of it's torrential mid-afternoon rain storms - and half the population needed to urgently hire a taxi.
Just imagine, if that system were applied to the railway system ? What price actually getting a seat on a train - as opposed to standing and strap hanging - on peak hour services ?
Unfortunately, the law of the jungle quickly comes to the fore when schemes like Ingogo replace an orderly fare structure. Unscrupulous drivers will resort to dumping agreed bookings if someone else offers more money and cabs will quickly avoid taxi ranks as they lurk in back streets and negotiate their next best paying fare on their mobile phones.
Getting a license to operate as a taxi involves a deal between the cab company and the state government. The number of taxi licenses is restricted to ensure that there is a balance between supply and demand on an overall basis.
The license also brings with it a set of standards with which the cab industry must comply. The cars must be modern, clean and in good repair. The drivers must wear a uniform - and have at least a basic knowledge of the city street system. There are penalties if these rules are broken.
Cabs have meters and the government negotiates the fare per kilometre cabs can charge. It seems that this new scheme is nothing more than a " hiring fee " - that is added to the charge on the meter.
It is open to abuse - and if the present laws are inadequate - new legislation is urgently needed to safeguard citizens rights to hire a cab within a regulated fare system !
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