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Workers' Voices

Local governments initiate reform of taxi operations for personal gain (I)

[Broadcast on 4 April 2006]

In recent years, many local government officials have been making money by launching so-called operational reforms. The most common way is to forcibly terminate taxi licenses which are near there expiration date and then auction them off at higher prices. Taxi owners are forced to buy designated new cabs, which are always more expensive. Many local government officials are only concerned with bringing in higher revenue, but not the livelihood of taxi drivers and taxi owners. Officials receive bribes to organise auctions and set out operational rules in favour of large bidders. Some officials and their relatives even take part in the auction. They simply ignore the consequences to society of these actions. As a result, many taxi owners lose their licenses to operate taxis and cannot make a living as they don't have money to bid for a new license. Starting from today, I will broadcast the interviews I did with Chen Shuzhi, an ordinary citizen in Yanji City in Jilin Province who has lost her taxi license.

Chen: We were both laid off from a former state-owned enterprises (xiagang gongren). We used our compensation money to buy a taxi, which would become the main source of our income. The Yanji City government launched an operational reform on the taxi licenses. They sold them by auction. The original price was 27,000 yuan each and it was sold at 30,000 yuan eventually. We didn't buy it.

Han Dongfang: When was this?

Chen: It was in April 2001.

Han: The licenses will be valid for how many years?

Chen: 20 years.

Han: And they were sold these licenses at 30,000 yuan each?

Chen: Yes.

Han: And you didn't buy one?

Chen: We didn't buy one because in addition to the license, the city government also required taxi operators to buy either a Jetta or a Santana. We're just ordinary people and we simply cannot afford that kind of car.

Han: How old was your car when the new policy was introduced in 2001?

Chen: We had bought it in November 1999.

Han: So it's only two years old.

Chen: Just a little more than two years, less than three years. According to the national regulations, my car would only be declared unusable when it was eight years old. My car passed the annual examination and it was valid until 31 July 2005, but the government launched the new policy on taxi licenses on 1 January 2004. So, we couldn't run our taxi after that.  At that time, we know about the government order on operational reform of taxi licenses. Last year, I found out on the Internet that the State enacted certain regulations prohibiting auction sales of taxi licenses. But the Yanji City government auctioned taxi licenses in April and May 2001. It was actually acting against the central government's orders [on the sale of taxi licenses].

Han: The problem is that they could say that it is an adjustment in the policy on the sale of the licenses. But another issue is that you were restricted to using only certain models?  Why should it be those models and not others?

Chen: The city government made the decision. It required you to buy a car of a designated brand along with the taxi operator's license. If you didn't buy it, you would not be allowed to continue operating. This was decided without any public discussion and ordinary citizens did not know anything about it. When we realized that, we started petitioning.

Han: In your petition, did you demand that you use your original cars and that you buy only the operator's license?

Chen: They [the city government] sold only 2,500 operator's licenses, but there were 5,000 taxis in existence. So only half of the taxi owners were able to get new licenses. They wouldn't consider whether you're laid-off workers. As we are between 50 and 60 years old, we have to pay the premiums for our pension funds. Sometimes, we are just unable to pay the premiums. The government simply didn't consider these issues.

Han: So that's the reason you started petitioning?

Chen: Yes.

Han: When did you start?

Chen: We started petitioning in Yanji City, but we later found that it was not effective. So in August 2003, we went to Beijing to launch our petition campaign there.

Han: Does that mean you started petitioning in Yanji City after the city government introduced the new policy [on taxi operator's licenses]?

Chen: Yes.

Han: It has not been effective?

Chen: Our timing wasn't good and we didn't achieve our goals.

Han: What kind of petition did you initiate?

Chen: We elected some representatives among the taxi operators to negotiate with the local government.

Han: How many taxis were involved?

Chen: A total of 5,000 taxis. The government sold 2,500 operator's licenses. So, half of the taxi owners got the licenses, while the other half became unemployed or xiagang again.

Han: What do you mean when you say half of you became xiagang again? Do you mean you couldn't continue driving your cabs?

Chen: Yes, that's it. Half of the drivers stopped driving on 31 December 2003.

Han: So, shortly before that time, you were given a grace period to continue your operations?

Chen: They gave us two years. In these two years, we feel very upset. Just think about it. We were laid off from state-owned enterprises. We have to take care of our families and we need to pay the premiums on our pension insurance. But the government has not considered how we are going to live and as ordinary people, how we can pay those premiums as well. Also, it did not hold any public consultation meetings on the new arrangements for taxi operator's licenses.

Han: So after you have received the government's notice, you immediately started petitioning in Yanji City?

Chen: Yes. Yes.

Han: Did you choose your representatives from among the 5,000 taxi drivers or the 2,500 drivers [who did not get the licenses]?

Chen: From among the 2,500 drivers. Those who got the licenses did not take part in the petition.

Han: So, those who did not get the licenses took part in the petition?

Chen: Yes. Yes.

Han: Those 2,500 taxi drivers were unable to buy the licenses because they have no money, isn't it?

Chen: They have no money to buy the licenses. And they have to buy a Jetta or a Santana, if they want to get a license. A Jetta or Santana costs 130,000 yuan. Together with the license fee, they would need to put up 160,000 yuan in total. An ordinary family simply cannot afford it. We borrowed money to buy an Auto, and we are still repaying that loan. It's just impossible for us to borrow another 100,000 yuan to buy [a new car and] the license. It is too much to even think about, and nobody would be willing to lend us the money.

Han: So, half of the 5,000 taxi drivers got the licenses?

Chen: Yes.

Han: So there are now 2,500 taxis in Yanji City?

Chen: Yes, there are now 4,000 taxis running on the streets in the city.

Han: How come?

Chen: There is a big contradiction. Why did our petition fail? It's mainly because the operation licenses are controlled by public security and procuratorial officials. Some officials have ten licenses while some have 30 to 60.

Han: Then they resell the licenses to others?

Chen: They don't. They rent them. They rent them to you. For example, we have the car and you have the license. You are from the public and procuratorial agencies. You don't need to rent the license to me under your own name. You can rent it to me by using some other company's name at 36,000 yuan a year. I pay you 36,000 yuan for renting the license from you so that I can use it for one year.

Han: It means that the 2,500 licenses were not bought by the taxi drivers?

Chen: Yep. In fact, very few ordinary citizens are able to buy the licenses. Most of the licenses were bought by people from the public security and procuratorial agencies and some people from other provinces. Very few local people bought the licenses.

Han: Did these people buy the licenses when they were auctioned?

Chen: On the first day of the auction, nobody bought them. Then, they [the local government] publicized it and some people came to the auction and bought them. Later, some company got involved and started buying the licenses. Officials of various government agencies also bought licenses.

Han: How many representatives did you elect when you first started petitioning?

Chen: More than 130 of us went to petition in Beijing.
Han: How many of you took part in the petition you started in Yanji?

Chen: There were more involved here in Yanji. Almost all of us took part in it. Our representatives went to negotiate with the government officials and we waited outside.

Han: How many representatives took part in the negotiations?

Chen: We elected five representatives. They went inside to negotiate with the officials and we waited outside. I tell you, for example, I have a car, an [Chinese-made] Auto, and only my husband could drive it. He could only do the night shift. He's 58 now. We need to hire a driver to do the daytime shift. Some families don't know how to drive, so they need to hire drivers to do both shifts. So you can tell the importance of the car to many people's livelihood.

Han: So you also invited your drivers to take part in the petition?

Chen: There were so many people there at that time. There were a few hundred people taking part each time.

Han: How did the government react at that time?

Chen: It seemed that the government didn't know what to do.