Wednesday, 30 September 2015

ACT Government leads the way on ride-sharing reform

The ACT leads the way in enabling the sharing economy while reducing the operating costs for taxi operators. Taxis will retain their exclusive rights to operate from taxi ranks and to be hailed from the street, whereas ride-sharing operators will operate in a similar manner to hire cars.

Speaking on ABC 666 AM this morning, Chief Minister Andrew Barr outlined the first phase of deregulating the taxi industry while introducing measures to regulate ride-sharing. Some of the changes include significant reductions in government fees for taxi operators while adding new fees and requirements, such as vehicle inspections, for ride-sharing operators.

Uber General Manager David Rohrsheim welcomed the changes. Uber have been calling for ride-sharing to be regulated appropriately for some time although their tactics have been rather aggressive.

A spokesman for the ACT taxi industry also welcomed the level playing field but is concerned that insurance requirements should also be similar.

How the ACT Government's rule that drivers who work exclusively for one ride-sharing provider will be deemed to be employees will intersect with the ATO's requirement that Uber drivers register for and collect the GST remains to be seen. But the move by the ACT goes some way to address some of my earlier concerns with ride-sharing.

One seemingly minor change that will be most noticeable, however, is that taxi drivers will no longer be required to wear uniforms. But once the symbols of regulation fall away, the tenuous status of taxi drivers will certainly be reduced. Whether the decrease in taxi operating costs will reduce taxi fares remains to be seen.

But the ACT Government is to be applauded for phasing in transport reform ahead of Uber's ride sharing service being offered in Canberra. The ACT is the first jurisdiction to address the challenges being brought about by ride sharing.

Sunday, 27 September 2015

Uber Regulatory Test Case: Who is in charge?

While many consumers are celebrating the rise of Uber, those who have invested in the taxi industry are rightly upset by Mr Turnbull's support for the multinational's "disruptive" business model. It is timely that a national test case is being heard in the courts to see whether this is a truly "disruptive" business model or otherwise an illegal thwarting of existing regulations.

I have argued previously that Uber's business model does not take into account numerous externalities, in particular, those that relate to the pay and conditions for its own drivers. Of course, consumers appear not to care about what it costs to pay an Uber driver, as long as it means cheaper fares for consumers. At least while the cheaper fares last.

But taxis are one of the few remaining regulated monopolies in the country, and taxi drivers share none of the regulatory advantages that Uber is cashing in on. Indeed, ACT Liberals Opposition Leader Jeremy Hanson recently spoke on 666 ABC Canberra and faced an uphill battle to convince the host that Uber were doing anything other than providing a cheaper, better service.

In my travels, I have heard others suggest that Uber's system works better than government regulation. One simply gives a driver a low rating, states they were taken the "long way", and then the company sympathises and offers a refund. That may be well and good, but while an existing regulatory monopoly is under threat, governments have done little to deregulate taxis or to make the market truly competitive.

And herein lies the real problem. Operating a taxi is expensive. Not because it necessarily is expensive, but because the regulatory model makes it so. Uber seems to be changing transport policy through sheer economic power rather than through government adopting a coordinated approach to dealing with the so-called "digital disruption".

If any new start-up can run rough-shod over existing regulations, then government needs to get ahead of the game. So far, however, government has buckled to pressure to the point where they are more or less congratulating Uber for upsetting a regularity model that government itself created.

The national test case means that government policy has yet again been left to the courts. Thankfully, the courts seem to take their unelected role more seriously than our elected representatives. Uber appears to be in a good position, but the current two-tiered regulatory model is more a result of poor policy than the case of Uber's smart business model.

Any business model that makes prices for consumers cheaper while paying workers less is hardly a recipe for success. Yet taxi operaters who comply with the law are currently being punished for doing so. That doesn't mean that Uber have it all wrong, but is does not auger well for other heavily regulated sectors of society when a foreign company enters the market and starts telling Australian governments how to regulate. 

Taxi operators are quite rightly upset. They played by the rules but the rules have been changed based on the pushiness of a multinational. Sure, transport reform is timely, but government waiting until a cheeky competitor like Uber comes along with plenty of money to get its own way is yet another example of sovereign risk that does not bode well for the future. 

Why bother to innovate while foreign companies like Uber appear to be running the whole show. Government needs to get its act together.

Wednesday, 23 September 2015

Is Australia ready for High-Speed Rail?

Many Australians are in awe of transportation systems overseas like Hong Kong's MTR and the super-fast Japanese and European bullet trains. But what about having a bullet train that travels past one's own backyard?

Is it possible that Australians are happy to use new transportation technologies elsewhere, as long as it doesn't affect them at home?

This is an interesting theme - one which a colleague suggested recently - and one I will explore further here.

I tend to view things as an historical institutionalist. This means that I see path dependencies and limitations in individual behaviour resulting from institutions - what March and Olsen (1989: 22) and North (1990: vii) see as the formal and informal rules of the game - and to view the co-evolution of institutions and technologies via a model of punctuated equilibrium.

There are some academic issues with this view but it is difficult to understand why a rich, well-educated and otherwise techno-savvy country like Australia lags so far behind the world in high-technology. 

As with broadband, high-speed rail is a case-in-point.

Much of the problem associated with infrastructure deployment has been a growing trend in governments avoiding debt. Even though interest rates are at their lowest in living memory.

But what makes things even more bizarre is that there is plenty of private sector investment money that is not being captured for investment in Australian infrastructure. Is this a case of yet another Australian policy regime?

Wilson (2000 citing Dougherty & Pfaltzgraff 1997) suggests that a policy regimes consists of the following characteristics:
First, there is an organizational dimension made up of states, social or political institutions. Second, regimes consist of mutually accepted decision-making procedures and agreed upon rules for action. Third, regimes contain shared principles, norms, and beliefs. Finally, regimes are organized around a particular issue.
I can't help but see policy regimes in the communications and transport sectors in Australia. Even though we will often hear complaints about the way policy is "done" in this country, we never hear the idea of the "policy regime" invoked to explain the reluctance to envisage different approaches to deploying infrastructure. For some reason, most likely related to the political benefits government can gain from fixing communications and transport issues, there is little scope for a systemic change to how we "do" networked infrastructure policy.

There seems to me to be a general agreement that government is responsible for solving our networked infrastructure problems, which includes high-speed rail. To date, acceptable "unsolicited" private sector proposals for infrastructure development, in particular from Transurban, have been focused on roads.

Meanwhile Spain has constantly pushed its high-speed rail barrow, yet there has been little traction in this area. Even though Australian estimates of the time to deploy high-speed rail are rather long (according to the Spaniards), domestic media still push the NIMBY aspects of corridor preservation rather than the benefits of more efficient ways to travel. It beggars belief.

The first and most obvious impediment to infrastructure deployment is commonly (and often pejoratively) referred to as ‘nimbyism’ (from NIMBY, an acronym for ‘not in my back yard’ – see Shepherd in Butcher 2008: 122-23).

Much of the resistance repeats what is happening in the United States. Australia and the United States share their reliance on the private motor vehicle at the expense of other forms of transport. For example, the Dallas-Houston high-speed rail link has been bogged down with utter nonsense. One "resistance group" even goes so far as to suggest that:
We need more roads for citizens to travel to ease our existing roadways... We do not need a high-speed railway in Texas that will only benefit a few, while at the same time disturbing thousands of citizens within its path.
You can't build your way out of congestion. Yet in Australia we see the American context repeating: an entrenched use of private motor vehicles as the most desirable way to travel.

So what does it mean? Well, if I had the answer I'd have plenty to do rather than blog my thoughts on transport policy. But what is clear is that there is a reluctance to try new transport technologies, and this most likely has something to do with entrenched ideas scaffolded by a policy regime..

But it is strange that these ideas seem only to exist in Australia and the United States. Maybe the idea of our "Washminster" system was much more than a federation superimposed over the system developed by our less-than-democratic forebears?

In the meantime, we seem to be satisfied with less-than-ideal systems such as Sydney's light rail and Canberra's Action bus service, even though using these services for the first time is an inside job requiring inside knowledge.

Maybe we are in awe of Hong Kong's MTR because it makes sense. You buy an Octopus card simply by following the instructions, then you turn up to the station and point yourself in the right direction until a train turns up. Simple.

But why we can't have the same thing here seems to be a conflation of history, entrenched preferences, and a policy regime that can't see past the end of the next road. And I think there-in lies the problem. Australia will not be ready for high-speed rail until the government says so.


Butcher, J. (ed.) (2008). Australia Under Construction: Nation-building past, present and future. Canberra: ANU e-Press.

March, J.G. & Olsen, J.P. (1989). Rediscovering Institutions: The Organizational Basis of Politics. New York: The Free Press
North, D. C. (1990). Institutions, institutional change, and economic performance. New York: Cambridge University Press.
Wilson, C.A. (2000). Policy Regimes and Policy Change. Journal of Public Policy, 20(3): 247-274.

Tuesday, 22 September 2015

Smart Cities: Brave new world or no country for old men?

The times are changing.  The "sharing economy" is upon us. But everyone knows it is not about sharing at all. It is about getting what you want at the cheapest price possible where everything is for sale. However, with little consequence for that once noble sentiment of the "common good", I am finding that I am reluctant to "share" in this future.

Glimpses of the "sharing" future appear in the most unlikely situations. When I was a young "Westie", being a Penrith Panthers supporter was the epitome of loyalty. The fans made the club. Yet today, the fans are providing "feedback" about the Canberra Raiders' performance and what they expect for next year.

So rather than the fans providing moral support for the club, the team is now expected to do it all themselves. "Sharing" at its finest. So I thought I would rate the fans. Dear fans, you do not pass or fail, you are expelled for behaviour likely to prejudice the Canberra Raiders.

We're all losing something every day but are too busy consuming to notice. I feel like I am John the Savage.

And when I think about the "smart" economy, I do not share Mr Turnbull's enthusiasm, even though I am pleased that he might put the "liberal" back into "Liberal". He might even put the sense of public duty back into the role of the prime minister.

But the more I reflect on the rise of Uber, traffic congestion in Sydney, having to pay for every part of day-to-day interactions, owning a property but still having to pay rent on the land, drinking unhealthy concoctions out of jars and that Canberra is somehow "cool" now whereas it wasn't before and so on, I must admit to becoming philosophical about the future. In particular, what's the point?

Now I am far from depressed or sad in any way, but I can't help heave an internal sigh of relief when I think 'Thank God that I may not live to see where all this "smartness" ends'.

Having said that, when I drove in Sydney traffic to get to Redfern at 5pm on a Friday night recently, I would have paid up to $500 if I could have shouted "Beam me up, Scotty!" and be done with it. Instead, I got caught at every no right turn and spent most of my time being abused while stuck in the middle of intersections with nowhere to go. 

Three hours later I arrived at my destination with my car sounding like a diesel for want of oil. Strangely enough, even my car recovered as soon as we got past Campbelltown on the way back to Canberra.

I do not want to live in high-density housing. I don't want to catch public transport unless it is as good as the Hong Kong MTR, and I don't want to use a smartphone or a GPS just to drive somewhere. As for Uber, that brings together all of the things I do not like. And don't get me started on TED Talks and how they are so much better than boring professors! Yet somehow this is all meant to be about choice.

So where does it all end? With population explosions in Sydney, Melbourne, Brisbane and Perth expected to bring these cities to a grinding halt, if nothing is done to address the growing need for more transport options, it will end badly. But what about other capital cities like Adelaide, Canberra, Darwin and Hobart?

There is still some hope left. Adelaide, Canberra, Darwin and Hobart are not growing as quickly as Sydney, Melbourne, Brisbane and Perth. This is partly driven by migrants preferring to live in the bigger cities. But there is not much being done to encourage people to leave the big cities in terms of opportunities for employment and so on. Yet it would seem that opportunities for growth in the smaller cities and even regional towns could shift the burden away from the larger cities which are already bursting at the seams.

Mr Turnbull's recent cabinet reshuffle brings cities back into the federal fold. Not since Whitlam established the Department of Urban and Regional Development, and later Hawke's "Building Better Cities" program have spatial issues been on the federal agenda. Indeed, the appointment of Mr Jamie Briggs as the Minister for Cities and the Built Environment is the first time a Coalition Government has looked beyond the market for solutions to spatial, transport and liveability issues in our major cities.

Unlike the United States, Australia has a distinct lack of medium-sized cities that can help overcome the challenge of high-density living. It is certainly not for everyone. But rather than tunnel our way into better transport networks, there are other ways to bring about regional renewal if only workplaces could be encouraged to change the way work is done.

Rather than focus on workers being in the building, a renewed focus on outcomes has the potential to change the current demand to live near places of employment. Yet we remain focused on inputs, as if the budgetary changes of the late 1990s were only administrative, rather than cultural, reforms.

If we are to offer real "choice" for people to live the life they wish, there must be alternatives to high-density living. Supporting regional growth has the potential to take the pressure off the big cities, while reviving parts of the country that are on the verge of becoming ghost towns. But changing the nature of work and providing viable alternatives to cars are key.

Higher-density living is only part of the solution. It is counter-intuitive that the easiest way to fix congestion problems is to make our cities even more compact. And it is certainly not how I would want to live if Canberra's development is anything to go by. Give me a federation house on a quarter-acre block as the bare minimum. The trouble is that many today would see such a living arrangement as an opportunity to split the property into two titles, knock down a piece of classic Australian architecture and build pokey rental properties. That's no choice at all.

Can you have your cake and eat it too? After all, the dream of a federation house on a quarter acre block in a city is well beyond affordability for the average punter. Yet regional towns have scores of classic architectural beauties on large plots of land going begging - towns that once boomed due to mining and rural industries or as important transport hubs.

There is still plenty of scope for regional renewal, and an opportunity for those of us who cringe at the thought of being a few feet away from one's neighbour every night. This is a big country after all.

What remains to be seen is whether the renewed focus on cities will improve their liveability or further erode the fortunes of the regions as even more people concentrate around improved transport and affordable housing close to employment opportunities in the major cities.

It would seem that improved transport (such as high-speed rail) and communications infrastructure targeted at potential regional growth areas would give people more options than the architectural penchant for sardine cans (complete with stacked stone that matches all of the other sardine cans on the street) in Canberra's newest suburbs that are beyond the affordability of many.

And architects really need to self-reflect. Mid-century architecture suggested that form followed function. Now architecture operates akin to Ricardo's Iron Law of Wages: Give them enough space to live in, convince them that they are privileged, then fleece them for all they're worth. The contemporary architectural mantra is closer to cheap is chic.

In the meantime, I will test my ideas by moving into a regional town. I wonder if I can rediscover the sense of local loyalty that has been lost in Canberra. I wonder if my federation house on a quarter-acre block will give me that sense of well-being that has evaded me here. I wonder, too, if I can change the current work model that has little to do with outcomes and get the best of both worlds - the living space I want with ongoing employment I enjoy.

These are the choices I wish to make but unfortunately government policy offers only a narrow set of choices that all lead to stacked stone sardine cans supported by light rail. It might as well be back to the future with workers terraces connected to workplaces by trams. We spent years trying to break the hold the slums had on our poorest souls in our major cities. I cannot see how it will be any different this time around.

But I must do something. I have had enough of feeling like John the Savage. I do not share Mr Turnbull's enthusiasm for a brave new world unless more choices are offered. Otherwise, I fear that this will indeed become no country for old men.

Wednesday, 26 August 2015

Applying Theory to Practice: Understanding Telecommunications and Transport Policy Outcomes

I am giving a lecture on how my transport and communications research relates to the themes of strategy, governance and innovation. The lecture will take place in the Ann Harding Centre at the University of Canberra from 9:30am on Friday 28 August 2015. The lecture is part of an event for staff and partners working with the DÅ«cere/University of Canberra MBA in Innovation and Leadership.

I have provided my lecture notes below. If you have any questions you are welcome to contact me via my work email,

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