Jammed traffic and competition from minicabs have caused sharp drops in bus use.
Uber drivers are among those who face paying an extra £3,000 a year each to operate in London even if the company keeps its licence, The Sunday Times has learnt.
Transport for London (TfL), the regulator, plans to force private-hire vehicles to pay the £11.50-a-day congestion charge because of concern that the proliferation of minicabs is choking streets and emptying bus services. If Uber shoulders the payments, it could cost the company between £20m and £60m a year.
At a meeting of licensing and enforcement officers in Leeds this month Tom Moody, head of policy for taxis at TfL, said the authority would propose the move within months.
If memory serves, the central area charge in Oslo is paid by cabs *for every trip inbound* rather than just once per day. If London’s minicabs are only charged per day though it just becomes a cost of doing business and spread across all pax. Alternatively it might increase minicab services outside the central area.
Article in Wired proposes that an ‘Uber’ tax be applied, which will solve a number of issues:
“Traffic Is a Disease. An Uber Tax Is the Cure –
Why congestion charging won’t do much to fix gridlock in our cities—and how a traffic tax on Uber and Lyft could get cars moving again.
“The world’s cities are dying. The diagnosis is heart disease, or, as it’s also known, traffic congestion. The cause of the problem is Uber, Lyft, and other ride-hailing services. The solution to the problem is taxes.
“Congestion isn’t new; gridlock predates Uber. Still, before Uber came along, it wasn’t particularly easy to drive around a city in a private vehicle. Either you had to spend thousands of dollars buying or leasing your own car—on top of parking and insurance and gas—or else you needed to navigate an unfriendly and expensive system of cabs and taxis, whose numbers were carefully managed by taxi regulators, medallion systems, and the like. The harder it was to drive, either in money or effort, the fewer people did it and the less traffic congestion there was.
“Uber and Lyft changed the entire system by ushering in an explosive rise of cars available for hire. In just a couple of minutes, at the tap of a button on your phone, you can find a car that is both cheaper and more convenient than anything that existed before. The downside of that innovation was an unprecedented jump in traffic. Show me a city where Uber has taken off, and I’ll show you a city where congestion has risen in tandem. That’s true even in cities like London, which were already trying to manage traffic flows by imposing a hefty congestion charge of about $16 per day. There seems to be no limit to how high supply and demand can go—unless, that is, local governments start stepping in.
“The problem is that cities’ standard tools won’t work on the likes of Uber. Up until now, economists’ usual response to traffic has been to implement a congestion charge: set a zone where congestion is a problem, and then charge drivers a fee for driving there. Since most drivers have other ways of getting into town (buses, trains, that kind of thing), the fee nudges many drivers onto public transit, thereby reducing the number of cars sitting in traffic. Congestion charges also raise new money, which invariably gets used to improve public transportation.
“Uber, however, breaks that model. Uber drivers aren’t using their car as a means of getting from A to B; they’re using it as a means of earning money. If they took a bus or a train into town that would defeat the purpose: They wouldn’t earn any money at all. Increasingly, they are the alternative to driving into town—only instead of driving in and then parking, taking themselves off the roadway, they drive in and then just continue driving, for hours and hours, making congestion even worse even as they effectively amortize the cost of any congestion fee.
“In other words, Uber drivers aren’t like the drivers historically targeted by a congestion charge. While charging them to drive into a crowded zone can certainly raise tax revenues, it’s not going to reduce congestion, because drivers-for-hire are almost entirely price-inelastic. They’re effectively forced to pay whatever the fee is.”
Rest of the article