The owners of taxi licence plates could be compensated under plans being developed to help the industry adjust to fast-growing competition from ride-sharing companies such as Uber.
A taskforce set up to advise on policies for taxis and ride-sharing will hand in its final report in October, but a discussion paper released on Friday outlines the changes now sweeping through the industry.
The discussion paper stops short of endorsing UberX, which is illegal at present under the NSW Passenger Transport Act. And taskforce chief Professor Gary Sturgess said new transport models could yet take the place of UberX, under which regular motorists offer lifts in their own cars.
"There's this assumption that the only alternative future is Uber and I don't know that that's a valid assumption," said Professor Sturgess, of the Australian and New Zealand Graduate School of Government.
Professor Sturgess' discussion paper does not suggest changing the Passenger Transport Act to legalise ride-sharing, though his final report might.
But Professor Sturgess indicated the owners of 5800-odd taxi licences, which are now trading for about $320,000, could be compensated to help lower taxi costs to compete with new entrants.
"The value that has been injected into the taxi licence over the years, that is going to have to be addressed," Professor Sturgess said.
"We have been specifically asked to focus on the question of structural adjustment and transition arrangements."
Professor Sturgess' discussion paper suggests the final report is likely to opt for a two-tier regulatory model. This would differentiate between transport as a customer makes a booking, for which records are kept, and as a taxi is hailed from a street, for which there may be no record.
"The process of climbing into a stranger's car on the street, with no one knowing you're there, no one knowing you've got into the car, is something that our mum told us not to do," Professor Sturgess said.
"And so hail and rank work is going to have to continue to be regulated in a form broadly similar to how those services are regulated today, with cameras and duress alarms and so on."
But he did not say what regulations might apply to the other form of transport, where someone books a ride on an app or phone.
Uber is pushing for the government to introduce rules that cover the hiring of drivers, insurance and the roadworthiness of vehicles. Such regulations have been introduced in other jurisdictions that have endorsed ride-sharing.
Professor Sturgess said it would be difficult to transpose policies developed elsewhere to Sydney. "Cities are different, traditions are different, industry structures are different," he said.
The paper also highlights the uncertainty over Uber's insurance coverage. "In Sydney, Uber has a discretionary, contingent liability policy which may provide some coverage for drivers in this case," it says. "However, Uber has not shared the details of this policy."
And Professor Sturgess stressed his sympathy with the existing cab industry. "One of the things that comes through is the emotion and pain amongst taxi drivers and operators," he said. "The sustainability of the people down at the pointy end of the industry is enormously important."
