ICCC set for second nationwide review of PMV, taxi fares

THE Independent Consumer and Competition Commission (ICCC) is conducting another public motor vehicle (PMV) and taxi fare review to determine appropriate fares for all the approved routes nationwide for the next regulatory period (2020-24).
ICCC commissioner and chief executive officer, Paulus Ain, said the current regulatory arrangements for PMV and taxi services would end on Dec 31 this year.
He said the ICCC was required under Section 25A (6) of the Prices Regulation (PR) Act to undertake another review.
PMV and taxi services are declared services for the purpose of price control under Sections 10 and 21 of the PR Act.
“In accordance with the PR Act, the ICCC is responsible for setting the PMV and taxi fares for all approved and designated routes in the country, thus, this is an important exercise,” Ain said.
Some of the broader issues that will be considered as part of this review will include but are not limited to the following:
l Identify any competition issues in the PMV and taxi industry. This will include the impact of the introduction of premium PMV services such Ginigoada Meri safe buses (women only service) on existing PMVs;
l determine the efficient costs for owning and operating PMVs and taxis in PNG. This includes taking into consideration the average cost of a typical motor vehicle used for PMV and taxi services, based on the range of vehicles used, average depreciation costs, average passenger capacity (for PMVs only) and average operating costs;
l estimate an appropriate weighted average costs of capital to determine an appropriate return on investment for PMV and taxi owners;
l using a building block approach, determine appropriate revenue requirements for PMVs and taxis respectively in the next regulatory period;
l based on the revenue requirement for PMVs, determine the appropriate fares (per kilometre fare) which will be used to re-set the base fares for all the approved routes in the country;
l based on the revenue requirement for taxis, determine the appropriate fare (per kilometre fare) and flag fall rate; and
l Consider all other issues relevant for this review but not limited to the enforcment of PMV and taxi fares, and safety and service standards.
A public notice advising of the review has been published in the newspapers. The closing date for receipt of comments in that public notice is April 31.
A draft report will be released on July 31. Close of comments on this draft report will be Aug 30.
ICCC will then release a final report on the review on Sept 31.
Ain said the ICCC endeavored to conduct this review in an open and transparent manner before making its final determinations.
“The Independent Consumer and Competition Commission encourages the general public, interested stakeholders and current
and prospective PMV and taxi owners to participate in this review process by providing comments or written submissions on the issues outlined in this public notice,” he said.
“The ICCC will consider all relevant information provided in this review.”
All submissions received will be treated as public information unless certain information is designated as “confidential”.