Johannesburg - The SA National Taxi Council (Santaco) has launched an index to be used by associations to calculate taxi fares, it said on Thursday.
Santaco CEO Nkululeko Buthelezi said taxi fares were under-priced by up to 70% "in some instances".
Taxi associations had no formal means of calculating what their fares should be.
"This means that when an association decides to increase fares, the amount is simply based on the general feeling among operator-members about what they need to restore their net earnings," Buthelezi said.
"In turn, this makes it difficult for the association to explain to commuters why fares are being increased."
This had prompted Santaco to develop the Taxi Fare Index.
The index was based on a computer programme that modelled the costs of taxi operations.
"An association will be able to enter data about its own routes - the length of the route, the number of passengers carried, and similar details - and get an accurate picture of what it should be charging," said Santaco secretary general Philip Taaibosch.
"In the same way, it can regularly measure increases in costs and be able to prepare its passengers for possible fares hikes," he said.
The index would include costs that were sometimes skimped by taxi operators.
These included costs associated with the labour department's legal requirements, as well as with the employment of managers by associations to ensure operations were smooth and efficient.
"These are costs which should be incurred, but fares might have to be increased to meet them," Taaibosch said.
Santaco had tested the model on a representative sample of commuter routes in inland, coastal and rural areas, and on long-distance services.
It had found that to meet all the operational costs of a commuter taxi service, to fully professional standards, the present fares would need to be increased by 50% to 70%, Taaibosch said.
Buthelezi said the index was still in the early stages and there was room for refinement.
"We are indeed convinced that this is a step in the right direction to meet the needs of our commuters and provide the necessary tools for taxi operators... to manage their businesses in an efficient and professional manner," he said.
The index would be released quarterly to the media and to Santaco members.
Santaco also launched its Journal of Public Transport Policy, which would be published quarterly to "contribute to debates on improved public transport".
Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.