Small passenger services review Te arotake i ngā ratonga tiaki i ngā punua rōpū kaieke

The consultation asked for feedback on 3 options for setting a cost-sharing rate for facilitated carpooling, and 3 new offences and penalties regulations needed to support the proposed Land Transport Rule amendments.

The feedback we received helped to inform the Government’s final decisions on the regulations.

Changes to SPS Rules were introduced to Parliament, as part of the Land Transport Amendment Bill.

Under the new regulatory system set out in the Bill, SPS drivers would still need to hold a passenger (P) endorsement to ensure passengers can feel safe, regardless of the particular service they use. However, the removal of some requirements, including the need to take a course to get the P endorsement, meant the cost of obtaining P endorsements would be reduced.

The International Transport Forum (ITF) released a report looking at principles for regulating app-based ride and taxi services. These recommendations and principles endorsed the changes the Government announced in April 2016.

The paper highlighted 4 policy insights and recommended that governments:

• keep the regulation framework of for-hire passenger transport services as simple and uniform as possible
• encourage innovative and more flexible regulation of for-hire transport services
• focus policy regarding for-hire passenger transport on the needs of consumers and society
• embrace data-led regulation to improve outcomes for society.

Based on the review and public consultation, the Government announced it would simplify the SPS rules, but maintain a focus on safety for passengers, drivers and vehicles. This meant the same rules would apply to all services that connect passengers with customers, including taxi, private hire, ridesharing, and dial-a-driver services.

Some rules that imposed costs on operators but no longer provided significant benefits would be removed to allow for fair competition between operators.

The Government confirmed that, for the changes to come into effect, legislation would need to be amended.

For the public consultation we provided a paper that set out the results of our review and identified 5 broad approaches for the future rules to govern how the SPS sector operates.

We asked for feedback on the 5 approaches:

1. Keep a modified status quo.
2. Reinforce separate markets for taxis and private hire services, with separate regulatory burdens.
3. Create a new single-class system where drivers are responsible for safety and compliance (reduced regulatory burden).
4. Create a new single-class system where operators have responsibility for safety and compliance (reduced regulatory burden).
5. Apply existing taxi requirements to all operators (higher regulatory burden in a new single class system).

We received 76 submissions in response to the consultation, with the majority (31) supporting option 4. This was also the review team’s preferred option.

Our review considered the SPS regulatory framework contained in the Land Transport Act 1998 and Land Transport Rule: Operator Licensing 2007. We worked with the Waka Kotahi NZ Transport Agency and the police to review the SPS sector.

The purpose of the review was to look at how cost-effective the SPS industry was, whether it was efficiently regulated, were regulations future proofed and did they allow for developments in technology.

We set up engagement sessions with a range of stakeholders from the sector to understand the most important issues with the current regulatory framework, and what aspects of the SPS sector stakeholders thought were most important for the future. We also presented some options for change and asked for feedback.

Stakeholders included:

• taxi industry
• private hire industry
• representative groups from the public and passengers
• government stakeholders
• technology service providers.

The review found that changes to the current system were needed and recommended that legislation should be amended after a public consultation process.

You can read the Act and the Rule on the Legislation website.

Land Transport Act 1998 (external link) 
Land Transport Rule: Operator Licensing 2007 (external link)