Whangarei's taxi industry has been struggling to survive through winter, with one
company attracting the New Zealand Taxi Federation's attention for alleged non-payment of vouchers.
Federation executive director Tim Reddish last month warned members not to accept vouchers from Kiwi Cabs Whangarei, saying it owed "substantial money" to its drivers, other
taxi firms and the federation.
The warning coincides with a tough period for the local industry, which operators say was badly hit by losing lucrative government contracts for transporting special needs clients in 2008. A dramatic fall-off in night work due to the recession is also blamed.
The city's three companies - Kiwi Cabs, Phoenix and A1 - have been reduced to two by the recent merger of A1 and Phoenix.
Mr Reddish said since he issued the warning, Kiwi Cabs owner Arthur George had given an assurance that he would make financial arrangements to enable him to honour vouchers.
He hoped Mr George would be able to start paying creditors within a month.
"I'd then retract the warning not to accept their vouchers - but I won't be issuing a retraction until we have seen evidence that payments are being made."
Drivers and taxi firms outside Whangarei were affected by Kiwi Cabs' problems because vouchers were widely used by large organisations for staff working a long way from home.
Industry sources had been reporting non-payment of vouchers for the past couple of months.
Whangarei drivers were
particularly affected. "There are now some pretty desperate people up there," he said.
Drivers who accepted vouchers were paid by their own employers, who then claimed those amounts from the
companies of origin. These
companies then billed the clients who had issued the vouchers to employees.
Mr Reddish said the circle of payment had been disrupted by Kiwi Cabs' financial difficulties.
Mr George, who was unable to be contacted, also owns financially troubled Red Cabs Hamilton. The Waikato Times newspaper reported last month that Red Cabs drivers said they were owed thousands of dollars in unpaid taxi chits and had waited months to get paid for contract work.
A1 Cabs owner Robert Gregory listed the government contracts as a factor behind the A1-Phoenix merger.
He said his company had lost about $80,000 a month in earnings. All three companies had lost contracts. "It has been a struggle for all of us," he said.
A1 had put off about six drivers and some administrative staff but was gradually starting to pick up more contracts. "My wife and I couldn't take wages for a while. We were struggling but we have survived," he said.
