Service charge

Union des consommateurs: Reforms to the law on taxis lead to 40% price increases and a deterioration in service | New

The union leader says the reforms are particularly disadvantageous to people in certain rural areas.

An NGO, the Consumers’ Union of Finland, aims to protect the interests of consumers, patients as well as patients and clients of social and health services. Image: Henrietta Hassinen / Yle

More and more people have filed complaints with the Consumers’ Union of Finland about problems with taxis since reforms in the sector’s laws began to affect major changes when they were rolled out in 2018, according to the NGO.

Consumers have filed complaints about ride availability, fare arrangements as well as the safety of taxi service providers across the country.

According to the general secretary of the union, Juha Beurling-Pomoellsector reforms put consumers in an unbalanced position.

Young consumers in urban areas who are able to navigate smartphone applications have the opportunity to compare tariff offers, for example.

But older people living in remote rural areas are particularly disadvantaged and typically struggle to get around when they need to. According to the union, this is partly because the reforms effectively removed previous requirements for taxi services to be available in these locations.

The consumers’ union said taxi availability issues need to be addressed, especially in areas without public transport services.

The changes to the law also introduced deregulated pricing to the industry, leaving taxi companies to decide what price to charge customers. But since the reforms were rolled out in early 2018, tariffs have risen significantly faster than the country’s inflation rate.

Statistics Finland estimated in June that taxi fares have risen by an average of 30% nationwide since 2015, three years before the reforms took effect. But in more remote parts of the north, price increases have approached 40% since then.

File photo of a taxi stand. Image: Silja Viitala/Yle

The General Manager of the Finnish Taxi Owners Federation, Timo Koskinentold the STT news service that the industry’s current pricing strategy is primarily based on market logic, adding that “consumer choices matter.”

“We provide the kinds of services that people want,” he said, adding that if the demand for cheaper taxis increases, those services will become more available. On the other hand, he said that if customers are increasingly looking for better taxi services, these will be offered more, adding that there are many opinions as to whether the fares have really increased. .

The federation represents a large part of the country’s taxi operators.

Koskinen questioned estimates that taxi fares had increased by up to 40%, noting that the overall costs of taxi rides subsidized by state social insurance institution Kela have actually fallen since 2018.

He also said that fares from Helsinki airport to the capital city center cost between 35 and 45 euros in the summer of 2018, while these days fixed prices for the same journey vary between 35 and 39 euros.

Koskinen added that in the summer of 2018, a 10-minute, 10 km ride cost 22 euros and now costs around 24 euros.

Union des consommateurs has acknowledged that taxi fares are generally not excessive when the market is functioning as it should.

However, according to union leader Beurling-Pomoell, the logic of the market only works well for certain groups and pointed out that consumers with reduced capacities are not always ready to seek the cheapest fares.

“If we’re talking about older people with impaired hearing and cognitive abilities, how can they start bidding for [cheaper] taxis very efficiently? he asked.