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Mumbai: Upper cap on surge pricing by cab aggregators not to be more than three times base rate of Kaali-Peelis, says govt

The state government issued the formula for surge pricing for app-based cab aggregators after issuing a Government Resolution (GR) on Monday and accepting a majority of 61 recommendations of the Khatua committee report.

Written by Iram Siddique , Omkar Gokhale | Mumbai | March 11, 2020 1:20:04 am
Kaali-Peelis, Mumbai Taxi, Mumbai cab aggregators, Mumbai news, maharashtra news, indain express news The government’s move had come after complaints by commuters that cab operators were charging exorbitant rates through the concept of surge pricing. (Representational Image)

In what might soon lead to regulation of mobile app-based cab aggregators, the state government has said the upper cap on surge pricing should not be more than three times the base fare of Kaali-Peelis (the iconic black and yellow-topped taxis of Mumbai).

The state government issued the formula for surge pricing for app-based cab aggregators after issuing a Government Resolution (GR) on Monday and accepting a majority of 61 recommendations of the Khatua committee report.

The state government in 2016 had said it will come out with a policy to fix the fare system for cab aggregators and implement strict controls on “surge pricing”. The policy was aimed at monitoring the services of popular cab operators such as Ola and Uber in the Mumbai Metropolitan Region (MMR) and provide them with fare meters.

The government’s move had come after complaints by commuters that cab operators were charging exorbitant rates through the concept of surge pricing, a surcharge on the given fare when the demand is higher than cabs available around a given area.

The state transport department in 2017 came out with Maharashtra City Taxi scheme 2017, which imposes a number of restrictions on drivers associated with these app-based cab aggregators. The implementation of the rules was challenged by Uber India Ltd, Ola Ltd and six driver-partners in the Bombay High Court.

On Monday, during the hearing of the petition, the state government also informed the High Court that it had issued a GR laying down a formula for the fare fixation of cab aggregators, including Ola and Uber.

The new GR states that the aggregators can surge fares up to three times of the base fares of the black and yellow-top taxis, which is Rs 14.85 per km at present.

However, senior officials from the transport department said at present, the government did not have any mandate to fix fares for cab aggregators but once it gets the mandate, a proper fare slab based on different kinds of vehicles used by cab aggregators will be taken into consideration.

“There will be various factors such as fuel pricing, vehicle type taken into consideration to come up with a scientific formula to decide the cap on surge,” a senior official said.

State lawyer G W Mattos told a division bench of Justice A A Sayed and Justice Anuja Prabhudesai on Monday that the government will not take any coercive action against Uber and Ola taxi drivers until further hearing.

In its report, the Khatua panel had recommended to fix the base fare between Rs 14 and Rs 16 per km for three categories of aggregator cabs ? regular, mid-sized and premium ? whereas the upper cap for surge pricing recommended for them is Rs 26, Rs 32 and Rs 38 per km, respectively.

According to officials, the B C Khatua committee was formed to decide on the formula for fixing autorickshaw and taxi fares and a fare scheme for cab aggregators was submitted on its own.

The state government has, however, accepted the new fare revision formulae recommended by the panel for the revision of fares of black and yellow taxis and autorickshaws.

Chaired by retired IAS officer B C Khatua, the four-member panel had submitted its report on October 10, 2017, after being formed in 2016.

The committee had also suggested a new telescopic fare for taxis, where the increase in journey length would attract a discount in fares, and a “happy hour” scheme, where there would be lower fares during lean periods.

In the GR, the government has rejected the happy hour scheme while accepting telescopic fares. However, the recommendations of the committee were rejected by autorickshaw union leader Thampi Kurian, who said, “The Khatua Committee does not take into account the empty kilometre an autorickshaw or taxi driver will clock.”

Kurian along with other union leaders is set to approach the transport minister to discuss the government’s stance on the report. However, officials from the state government said at present, the fares of both autorickshaw and taxi are much lower than what has been recommended by Khatua committee as well as Hakim Committee.

“We will decide on issues, including fares, taking all stakeholders into consideration,” said an official from the transport department.

At present, the minimum fare for black and yellow taxis and autorickshaws are Rs 22 and Rs 18 for first 1.5 km, respectively. Beyond 1.5 km, the fare goes up to Rs 15 per km for taxis and Rs 12 for autorickshaws.

The HC has asked the state to serve a copy of the GR to petitioner cab aggregators and posted further hearing on April 6.

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