Normally I don’t like to get involved in politics. For my regular followers, you know I mostly cover stories on entertainment and sharing “feel good” stories with you. However, I can no longer be silent. Enough is enough. There is a lot of misinformation out and I have tried my best to break down the situation to show you what is REALLY going on. I hope this opinion piece offers you a better prospective on the whole ride-sharing debate in Winnipeg.
First, some background for you. I’m a proud Winnipegger. Born and raised in Winnipeg and I still spent most of my downtime there. It’s a city where hard working Manitobans ( many of them newcomers) lay their roots down to raise their families. Winnipeg is by no means a rich cosmopolitan city as compared to Toronto but it’s a place where you can really build a good life for you and your family. With the average Winnipegger making around $40,000 salary and the average family making around a $77,000 salary, people work together to ensure affordability for all.
So in case you were wondering why I care so much what happens in Winnipeg, this is why. Winnipeg and the people there mean the WORLD to me. No matter where in the world I go or which A-list celebrities I meet, when I am asked where I am from, I proudly say I’m from Winnipeg (and then I encourage them to come visit the city themselves). In fact, every time I have interviewed a celebrity on their cross Canada tour and realized they haven’t included Winnipeg as a stop, I have told them flat out that they NEED to include us. I have been and will always be a proud ambassador for this city and for the province.
So putting that aside, here is the issue at hand.
Uber and Lyft want to enter the Winnipeg/Manitoba market. This normally would be fine as it’s a free open market. However, I am shocked that Winnipeg Mayor Brian Bowman and his city council team have given Uber/Lyft essentially a free pass to come into Winnipeg and make a bunch of money off Winnipeggers and not have to contribute anything to our city and to the province.
Here are some facts. I have included my references next to each quotes so you can read for yourself where I’m getting this information.
Currently Winnipeg taxi drivers/limos pay over $10,300 in car insurance. Since they are constantly on the road, this means their risk is higher to get into an accident and that’s why Manitoba Public Insurance (MPI) charges them so much more to make sure regular folks aren’t paying for any taxi accidents. Which I think we can all agree is fair. (http://www.cbc.ca/news/canada/manitoba/uber-drivers-four-times-less-insurance-1.4458031)
Now Uber/Lyft drivers would pay $2,500 in car insurance. For doing the EXACT same job and having the SAME amount of risk. So once Uber/Lyft come into Winnipeg and all the current taxi drivers switch over to driving for Uber/Lyft…why wouldn’t they pay the same amount in car insurance? Uber’s argument is that their drivers operate on a part time basis…but at the end of the day so can cab and limo drivers. The entire ride-sharing and taxi/limo industry works as a 24/h operation. Drivers can at ANYTIME decide to work and start up their cars. So that’s why they are charged on a 24/h basis. There is no limitation for an Uber/Lyft driver to “just” drive part-time. If being an Uber/Lyft driver is so great, why wouldn’t those drivers make this a full time job? If there is a Jets game or a concert in town, why wouldn’t all the taxi drivers and Uber/Lyft drivers jump into their cars and start making money? The nature of this transportation industry is that drivers have to be able to drive whenever and wherever they want. So the argument that Uber/Lyft drivers “only” drive part time is nonsense. No one wants to deal with a situation where an Uber/Lyft driver is “off the clock” but ends up picking up passengers and getting into an accident. So I think we can all agree, all taxis and Uber/Lyfts should be regulated as 24/h work schedules, leaving it up to the individual drivers to decide how much or how little they choose to work on any given day.
As you all know, we all pay into an insurance “pool” so that when we do get into accident or some freak act of nature happens (like hail), Manitoba Public Insurance pays us for the damages. Sometimes it’s a lot of money. But if one person has a greater risk of getting into an accident and also has a greater risk of a higher payout, why wouldn’t those individuals pay higher amounts for insurance? I’m sure for those of you that have ever had an accident, you would have noticed how quickly your insurance rates go up with each and every accident. No one wants to have to pay for another driver’s accident or bad driving, so if there is a greater risk that a car will get into an accident or have higher payouts, then yes they should pay more into the insurance pool. Again, I think we can all agree on this. This is fair.
MPI says “the proposed rate model is fair, gives drivers choice and prevents other vehicle owners from subsidizing Uber vehicles.” (https://winnipeg.ctvnews.ca/uber-may-make-u-turn-away-from-winnipeg-1.3754221) “The proposed insurance rates for private vehicle for hire operators is consistent with other jurisdictions…the proposed insurance model ensures that vehicle for hire operators are insured in a separate insurance class that will prevent cross-subsidization of loss experience with other major vehicle classes. Under the model, there is flexibility for vehicle for hire operator to select specific time bands in which they intend to provide for-hire services.”
This doesn’t make sense to me. MPI is saying they are trying to fair and make sure regular vehicle owners don’t have to subsidize Uber/Lyft but by asking Uber/Lyft vehicles to pay $2,500 vs. the $10,300 that cabs pay…isn’t that a subsidization right there? I would like to see what research has been conducted to prove that Uber/Lyft vehicles get in such little accidents that they can justify paying $2500 into the system and NOT be a burden on other vehicles owners.
I think NDP leader Wab Kinew says it best “”It seems a little surprising that Uber is saying things aren’t fair when they’re being offered the chance to operate in Manitoba for something like 25% of what the taxi industry has to pay to do business here,” he told CTV Winnipeg. (https://winnipeg.ctvnews.ca/uber-may-make-u-turn-away-from-winnipeg-1.3754221)
Already Manitobans pay so much for car insurance and MPI just announced in December 2017 that everyone with car insurance will pay 2.6 per cent more. This is because MPI says they have $85 MILLION in losses. So already MPI has lost millions of dollars and expects all of us to chip in. By allowing ride sharing companies here where they are constantly driving around with passengers and more likely to be in an accident…do we really think those drivers paying $2,500 in car insurance are REALLY going to cover the total claims they will have? I have friends and family who pay that amount for personal vehicles that they drive a handful of times a week. $2500 for commercial car insurance is actually very little. Why can’t Uber/Lyft drivers pay the same as taxi drivers which is $10,300? Why does the government expect regular hard working Manitobans to subsidize for a multinational BILLION dollar company like Uber?
Heads up, in case you didn’t know, Uber is VALUED at over $60 BILLION dollars. Yet they are crying they and their drivers can’t even afford $2500 for their insurance? On the other side, Winnipeg taxi drivers make around $17,500 a year each. That means on a 24 hour shift with 2 drivers, the total average income those two drivers make is $35,000 per year. (https://www.gov.mb.ca/mr/taxicab/pubs/summary_overview-of-the-taxicab-industry2016.pdf)
Oh and as for Lyft? They are valued at $7.5 billion. (https://techcrunch.com/2017/06/22/as-ubers-value-slips-on-the-secondary-market-lyfts-is-rising/)
So city council expects Winnipeg taxi drivers with a net income of $17,500 each to pay over $10,000 in insurance PLUS pay $5,000 in REQUIRED equipment PLUS $600 in yearly license fees PLUS gas PLUS whatever else their expenses are. Yet a company like UBER, which is valued in the BILLIONS, says their drivers can’t afford to pay $2500 in car insurance? Hey Uber, maybe pay your drivers more?
Winnipeg taxi drivers make below the average Winnipeg salary and are STILL expected to pay thousands more than the proposed costs for Uber/Lyft. So something doesn’t add up if Uber says $2500 is too much. On top of the extra car insurance Winnipeg cab drivers have to pay, the new ride-sharing “bylaw estimates taxi drivers will pay $878,000 in fees next year, while ride-share companies pay $378,000.” Wait, so taxi cabs are SUBSIDIZING for their competition to enter the market? In what other industry does a business cover the costs of its competition to enter a market? This makes no sense to me. That’s like telling Wendy’s restaurants to pay thousands of dollars in fees to help McDonalds open up next door to them. Why would any government require a business to cover the costs of another? (http://winnipegsun.com/news/local-news/cab-coalition-rallies-against-taxi-tax)
It’s not just MPI rates going up for regular Manitobans. Manitoba Hydro is asking for rate increases of almost 7.8 percent. This is above the rate of inflation. I can guarantee you that the salaries of working Manitobans are not going up even close to the levels these Crown Corporations are asking for.
Regular folks don’t get subsidized for their insurance or their hydro or for ANYTHING. Uber isn’t even a company in Manitoba (aka no actual office or staff or investment here). So essentially Uber/Lyft are going to pay less in expenses and make a huge amount of profit (that will leave Manitoba) and go right into the pockets of the American head office executives.
The city has said it will cost $1.3 million to regulate all vehicles for hire. In order to cover this cost, “the city plans to boost basic cab charges from $3.50 to $3.75…increase the 1st km rate from $1.38 to $1.60.” (http://www.cbc.ca/news/canada/manitoba/winnipeg-uber-taxi-regulation-1.4428748)
This means it’s NOT the cab companies that increase their rates. I have heard many people online complain about the higher taxi costs. Why don’t you direct your frustration where it belongs…at the CITY. The city FORCES taxi drivers to increase their rates which means taking a cab just got more expensive for everyone. Especially for low income families and individuals who may not have the income to get a credit card and those that can not take the bus. Oh wait. Taking a public bus just got more expensive for Winnipeggers too…that is if your route wasn’t cut in the budget. If you didn’t know, the cash fare for the bus is now $2.95, making this the “largest transit hike in more than a decade.” This also means an annual pass will rise to $1,107.60. (http://www.cbc.ca/news/canada/manitoba/winnipeg-pay-more-2018-1.4468085)
In a Dec 28 interview with CBC Winnipeg reporter Bartley Kives, Mayor Bowman states he is ‘also eager to remind Winnipeggers the city plans to spend a record $116 million on road renewals in 2018. But overall spending on infrastructure renewal is going down dramatically, from $318 million this year to $246 million in 2018, with less actual cash and more borrowing devoted to the job.’ The mayor noted flat provincial funding has given the city no choice but to limit its spending and make unpopular choices to raise hourly parking rates and Winnipeg Transit fares.
“The new fiscal reality that we face in the province is putting a squeeze on Winnipeg and Winnipeg taxpayers, no doubt,” Bowman said. (http://www.cbc.ca/news/canada/manitoba/winnipeg-mayor-bowman-2017-review-1.4459333)
Isn’t that interesting? How Mayor Bowman freely states how he needs to “squeeze” Winnipeg taxpayers yet at an opportunity to get a lot of money from Uber/Lyft to operate in the city, he doesn’t require them to pay EQUAL amounts into the system? Who is going to pay for all the extra wear and tear Uber/Lyft vehicles will have on our roads? As I see it, if Winnipeg roads are in such bad shape, why wouldn’t the companies who use it the most pay more to help cover the costs of repair and maintenance?
So let’s see, just a few months ago the mayor and council were pleading how poor the city was and they had NO CHOICE but to jack up a number of services costs and fees. As mentioned before, bus fares have gone up and so have parking fees. Also property taxes were raised beyond inflation and water bills have gone up. Oh by the way, one of the biggest campaign promises Mayor Bowman gave us in his 2014 pledge was to not raise property taxes. Yet he has broken that promise again. Don’t worry, ensuring his campaign promise to bring Uber/Lyft here at all costs will get fulfilled…even if it gives Winnipeggers a raw deal and ends up costing us more out of our own pockets. (http://winnipegsun.com/opinion/editorials/winnipeg-wrong-to-hikes-fees)
It really bothers me how Uber’s operating model seems to be to undercut the entire taxi industry so much through backdoor deals and lobbying where they will eliminate their current competition. And trust me when I say this. As a member of the media who has looked into Uber’s practices around the world…once the taxi industry disappears and all we have left is Uber/Lyft…you better believe they are going to jack up their prices. Oh and they will eventually get rid of their drivers with self-driving cars. (https://www.theguardian.com/technology/2017/nov/20/uber-volvo-suv-self-driving-future-business-ride-hailing-lyft-waymo)