Issue link: https://maltatoday.uberflip.com/i/1508267
6 maltatoday | SUNDAY • 24 SEPTEMBER 2023 NEWS Cab drivers call for more regulation in 'unsustainable' industry Timing of subsidy withdrawal 'hugely critical' MATTHEW FARRUGIA THE Light Passenger Opera- tors Association (LPOA) has de- scribed the ride-hailling industry as an "unsustainable" one which has gone unregulated for years. Speaking to MaltaToday dur- ing an interview the President of LPOA, Aaron Gatt was reacting to instances of abuse within the industry flagged by this newspa- per recently. Gatt reflected widespread con- cern among the fledgling asso- ciation's members, as he noted that operators were seeing their profit margins dive by as much as 45% from the previous year while working more hours. Gatt, who has been working in the industry for a number of years, explained that the market had started seeing drastic chang- es after its regulations were up- dated in 2019. This led lower bar- riers of entry to the industry. "After COVID-19 there was an explosion in new drivers with- in the industry," he noted while acknowledging that as a Y-plate vehicle owner, he knew that ride- hailling platforms would become the future of the industry. After the new regulations came into force, LPOA explained, hundreds started applying for their Y-plate vehicles while authorities failed to regulate them. The lobby confirmed what oth- er drivers had told MaltaToday regarding a complete lack of in- spections on operators' garages, meaning that an operator could register his vehicles under a spe- cific garage which does not have the capacity to accommodate the vehicles. "The lack of proper enforce- ment early on has caused the abuse we see nowadays," the LPOA President said. One con- sequence of this, MaltaToday has learned is that a number of drivers are forced to sleep in their cars, as they do not own a garage and must work long hours. Another common practice to skirt garage requirements is for operators who employ two peo- ple to cover 12-hour shifts on each vehicle, meaning that the vehicle would not need to be ga- raged overnight. Gatt also noted that without the necessary regulation and en- forcement, law-abiding operators were also bearing the brunt of reckless behaviour. An example of this is the mammoth's task for a Y-plate vehicle owner to ac- quire insurance for their vehicles. Gatt said that given the number of controversies surrounding the industry all operators, including those who adhere to the regula- tions were subject to a doubling in their insurance fees in a short span of time. These pressures, according to Gatt have started to squeeze le- gitimate operators out of busi- ness. "I know operators like my- self who've quit the industry," he said. 'We want more proactive en- forcement' In light of these problems, LPOA told this newspaper that effective enforcement and regulation is the way forward if legitimate opera- tors are to be protected. MaltaToday has learned that operators within the industry have only just started to be asked to provide Transport Malta with "an exhaustive list of all the per- sons who are employed," with operators. Apart from that, they are also now required to send the authority the documentation which shows that each driver has a driver's tag, among other re- quirements. Despite this, Gatt stated that the industry requires more enforce- ment. "We want more proactive enforcement," he stated. An example of this, according to Gatt could be for Transport Malta to contact operators which are known for their illegal prac- tices. Gatt said that officials need only visit supermarkets' parking spaces and contact the owners of the countless Y-plate vehicles they find, instead of "dragging their feet." Gatt nonetheless acknowledged that authorities seem to have ramped up enforcement during the past weeks, something he hopes will persist. CONTINUED FROM PAGE 1 Von Brockdorff said the subsidies gov- ernment is forking out to keep fuel and energy prices stable remains important to mitigate the higher inflation but warned there is growing pressure in the EU on governments to scale back support. He said the big question is for how long can fuel and energy be subsidised the way Malta has been doing so for the past two years. "The Finance Minister has already said he intends to maintain the subsidies but the decision when to withdraw them is going to be hugely critical because it could lead to an increased bout of inflation and cause the economy to slow down," Von Brockdorff said. Fuel prices in Malta have remained sta- ble since June 2020, making them the cheapest across the EU. Electricity tar- iffs have remained unchanged since 2014 after government stepped in last year to keep consumer prices stable when a fixed price arrangement with Electrogas ex- pired. Inflation in Malta has remained stub- bornly high despite consumers being cushioned from price hikes in fuel and energy. According to the last published RPI, prices in July increased by 4.7%, down from 5.4% in June. This was the lowest annual rate since March last year. But the index showed that the highest annual inflation rates were registered in housing (+8.9%) and food (+8.8%). Joseph Muscat pens Economic Note A recent Economic Note penned by for- mer prime minister Joseph Muscat with research by Sagalytics and published on LinkedIn, paints a gloomy picture of how people are dealing with inflation. All surveyed households reported an in- crease in the cost of living, with the me- dian perceived price increase registered between €20 and €50 per week over the past six months. "This is even more considerable given the fact that the median weekly expend- iture has shifted onto a higher category, that of between €150 and €199 per week," the note reads. The findings suggest that price increas- es no longer rest with one-off hikes for essential goods but reflect "a materiali- sation of expected future price increases that result in inflationary pressures". The post-pandemic recovery in con- sumption also appears to have halted with consumers "cutting back on discretionary spending in light of these pressures". "A majority indicates that if price infla- tion of necessities is to continue in the near future, they would have to cut back on their consumption patterns together with an interestingly higher percentage of respondents who would request a pay rise or work harder to maintain their current standard of living," the note states. Contrary to the pressure being made by the European Commission on govern- ments to scale back energy support, a vast majority of those surveyed believe that government should continue to subsidise energy prices. Reflecting on the survey findings, Mus- cat sounds the warning that increased usage of precautionary savings and a will- ingness to maintain standard of living ei- ther by requesting higher pay or increase service provision rates, could present "an imminent concern" of a wage price spiral. Economist Philip von Brockdorff