Uber to become legal in NSW from midnight

Taxis will receive compensation from the NSW government after it legalised ride-sharing in the state.
Image Credit: Jason Thein (CC BY 2.0)

From midnight tonight, Uber’s UberX service will be legal in NSW following a decision by Premier Mike Baird’s cabinet today. The decision makes NSW the second jurisdiction in Australia to legalise the service, following the ACT which legalised it in October. Previously only the Uber Taxi and Uber Black services were legal in NSW as they were operated by registered taxis and hire cars.

UberX is a ride-sharing service where almost anyone with a car can provide a service to others using technology to connect drivers with passengers.

In conjunction with UberX being legalised, the NSW government will also set up an Industry Assistance Fund to compensate taxi operators as a result of the change. It is expected that taxi plates, which cost in excess of $200,000 will drop in value.

Perpetual plate holders will be eligible for $20,000 per plate up to two plates with those who only recently entered the industry given access to a compensation fund which will provide up to $175,000 compensation for those who purchased taxi plates in 2015, reducing each year an operator has been in the industry down to nil for those who have been in the industry since 2006.

In order to fund the compensation scheme, a temporary $1 levy will be imposed on every trip by taxi, Uber or hire car.

The government says that average taxi fares will drop by $2 as a result of the repeal of more than 50 regulations and a reduction in taxi fees. Taxis will retain exclusive rights to pick up passengers from taxi ranks and off the street as well as continue to have exclusive access to Sydney Airport.

In addition to ride-sharing services being legalised, the government will require drivers to pay a $45 accreditation fee and undergo criminal checks. It will also require cars used for the service to have business registration and CTP.