SHARE
COPY LINK

JOHN LICHFIELD

OPINION: Macron helped Uber disrupt rip-off Paris taxi business. Is that a scandal?

The global investigation into taxi firm Uber has revealed that Emmanuel Macron was a key ally of the company in France - but was that really so wrong, asks John Lichfield? Or did Macron play a part in providing a reasonable service for taxi passengers in Paris (while pursuing his stated goal of opening up the French economy)?

OPINION: Macron helped Uber disrupt rip-off Paris taxi business. Is that a scandal?
Paris taxi drivers protest against the arrival of Uber in 2016. Photo by Eric Feferberg / AFP

Oh what a lovely scandal, just the kind the French media and the French Left adore.

It involves “les lobbies” (a French word meaning the rich, powerful and usually the foreign). It involves an alleged conspiracy to tunnel through the Alpine massif of French employment law. It is satisfyingly complex and so lends itself to far-fetched allegations and theories.

Above all, it involves President Emmanuel Macron before he was President.

I must say that I struggle to see why it is a big scandal. But lots of documents and detail have yet to be explored. Maybe, I will be proved wrong.

It involves Uber, the online taxi service which has taken many of the world’s cities by storm in the last decade. A treasure trove of 240,000 internal Uber documents has been leaked to an investigative consortium of the international media, starting with The Guardian in Britain but also including Le Monde in France.

The documents tell the story of a vast lobbying effort, and alleged dirty tricks, deployed by Uber from its Californian base to overturn or undermine the rules governing taxis in the United States and many other nations.

In France, it turns out, Uber had an ally on the inside, a mole or adviser within government, the then-economy minister, Emmanuel Macron. He went out of his way to help Uber to challenge and weaken opposition from French established taxi interests, trades unions and President François Hollande’s Socialist government in the period 2014-6.

Wicked? Not really. Macron more or less announced what he was doing at the time.

He was NOT taking back-handers (or at least no one has remotely accused him of doing so). He was pursuing his belief that France has been enfeebled by vested interests, restraint on trade and over-zealous employment law.

He saw Uber as a model for a more enterprising, less state-controlled economy – and a new source of jobs for the crime-and-unemployment-ridden, multi-racial, inner suburbs or banlieues.

 “If you oppose this then what do you want?” he said in 2016. “That they should go back to dealing drugs?”

Two years earlier, when questioned on his support for Uber, he said: “My job is not to help established companies but to work for the outsiders, the innovators.”

Some of Uber’s tactics were over the top. Some of what Macron did may also seem excessive. He was an insufferably cocksure young minister at that time (I met him briefly.) Amongst other things, he secretly helped to draft amendments, on behalf of Uber, to soften a law promoted by his own government.

But the outcome was (in my view) a reasonable balance between Uber’s more far-fetched proposals (a chaotic lift-sharing business called UberPop) and a reasonably regulated, new online taxi-hailing operation.

The French Left talks of a “state scandal” and plans to launch a parliamentary commission of inquiry. The Far Right accuses Macron of “Uberising” France (ie weakening job protections) in the interests of wealthy foreigners.

No one has much asked the obvious question. Is Uber a “good thing”?

Much of the coverage so far speaks of Uber as if was self-evidently a deplorable phenomenon. Have the authors of those articles ever used Ubers, as I frequently do whenever I’m in Paris, London or any other large city?

Pre-Uber, Paris taxis and taxi-drivers were a government-protected disgrace: unhelpful, rude, expensive and hard to find. One of the great achievements of Uber has been to oblige Paris taxis treat their passengers reasonably.

It should also be remembered that Macron’s support for Uber was part of a market-opening philosophy which also led to the creation of an-inter-city coach service in France (les cars Macron) and a successful French long-distance, lift-sharing app, BlaBlaCar.

It is also pre-figured a reform of employment law applied, unevenly, during his first term in the Elysée Palace. Some say Macron went too far; others that he promised more than he delivered.

 The fact is that (for several reasons, including the changes in unemployment law) France now has its lowest jobless total for 14 years and its lowest youth unemployment for 40 years. Two thirds of the new jobs created are not “Uber jobs” or short-term contracts but full-rights, permanent CDI jobs (Contrats de travail à durée indeterminé).

France under Macron has also become the top destination in Europe for foreign investment. Coincidentally – although no one much made the connection – it was announced that France would receive an extra €6.7 billion in foreign business investment this year, creating 4,000 new jobs. This is additional to the €4 billion promised early this year.

The great Uber scandal will doubtless run for a while. It may or may not be extinguished by the summer holidays. Who knows what is lurking in the hundreds of thousands of leaked Uber documents as yet unstudied?

Placed in context, what we know so far is pretty innocuous for Macron. Those who detest him will find new reasons to do so. Those who tolerate, or approve of, him will shrug and turn their eyes to other more pressing crises.

Member comments

  1. Thank you John Litchfield for this eminently reasonable analysis of a “scandal” that, so far, is hardly scandalous at all. Given Macron’s background and publicly-stated goals, and the previously dire scene of the taxi business in Paris, we would perhaps be more shocked if he had not done his best to help Uber. Just for context, a real scandal would be–let me, as an American, stretch my imagination–a real scandal would be if Macron had phoned the president of a former soviet-bloc nation and threatened, him, as a gangster would, to withhold financial support to motivate that president to “dig up” evidence of malfeasance committed by a close relative of Marine Le Pen. A crazy unimaginable idea for any world leader! But that would be a scandal worth worrying about.

  2. Hollande, typically, bent to pressure from the newspapers and vested interests and passed a law that supposedly stopped Uber but actually did nothing of the sort. In my town (Nice) the taxis are notorious for their ripoffs notably, of course, of tourists coming in from the airport. They are also, seemingly, a monopoly dominate by pieds noirs. You won’t see a black or N African cabbie. We have the ‘shield’ system whereby there are a limited number of licences and a taxi licence is held by an individual who can then pass it on to someone else when he retires. The going rate for a licence a few years ago was, according to the local paper, 300k €. You don’t have to be a genius to see exactly what kind of abuses that would encourage.

    I reckon these revelations will work in Macron’s favour.

    When Uber started up in Nice in May 2015 the cabbies blockaded the airport, setting fire to heaps of tires in the middle of the road and threatening violence to anyone trying to go past. I had to get to the airport to meet a friend, the buses were stopping a mile or so short of the airport. I was stopped from walking along the pavement by the police, who were (natch) doing nothing about the taxi drivers, I asked why but had no coherent reply, although I suspect it was only my strong English accent that stopped me getting sprayed. When la flic moved to the toher side of the pavement to stop someone else I carried on to the airport through scenes of absolute mayhem.

    The Nice mairie has now extended the trams system to the airport so you don’t have to take taxis any longer unless you’re snobbish.

  3. Good and fair summary. I use both Uber and G7 taxis, it gives me choice. I read both the Guardian and Le Monde; I find their investigative journalism effective but sometimes over zealous and holier than thou. But obviously worth attention

Log in here to leave a comment.
Become a Member to leave a comment.
For members

MONEY

Revealed: What will you receive from France’s €65bn cost-of-living aid package?

The French parliament has finally passed a massive €65 billion package of measures aimed at helping French residents with the spiralling cost of living. Here's a rundown of the help on offer, who it's available to and when it comes into effect.

Revealed: What will you receive from France's €65bn cost-of-living aid package?

After three weeks of sometimes heated debate, France’s parliament has adopted its multi-part purchasing power package to help mitigate rising cost of living and inflation.

In total, parliament approved a budget of nearly €65 billion for the whole package. 

It includes a raft of measures including price shields, tax rebates and grants. Here’s what is included and who will benefit.

Electricity and gas The government has voted to extend the tariff shield on gas and electricity prices until the end of the year: this means that gas prices will continue to remain frozen and that price hikes for electricity prices will be capped at four percent. 

For who: This applies to everyone who has a gas or electricity account in France.

When: The price freeze is already in effect and will continue until at least December 31st.

Fuel subsidy – The government’s fuel rebate (on petrol/gasoline and diesel) will be increased from €0.18 per litre to €0.30 in September and October, and then in November and December it will fall to €0.10. 

For who: All drivers (including tourists) – this is applied automatically at all fuel stations in France

When: The €0.18 per litre rebate is already in place and remains until August 31st, and rises to €0.30 on September 1st.

Pensions – The index point for pensions will be raised by four percent.

Who: This covers anyone who receives a French pension – roughly 14 million people – it does not affect anyone who gets a pension from another country.

When: From September 9th. 

Abolishing the TV licence fee – The annual TV licence raised €3.7 billion a year for public broadcasting, with the majority having gone toward France Télévisions, but has now been scrapped. It was €138 per household. 

For who: Any household with a television. This equates to about 23 million households in France who will no longer have to pay this yearly tax.

When: The was due to be levied on November 15th, but this year no bills will be sent out.

Tripling the Macron bonus – The maximum annual bonus – which is exempt from income and social security taxes – will be tripled.

It is a one time, tax-free payout that can be given to workers by their employers – if they chose to. Companies will now be able to pay up to €3,000 to their employees (and up to €6,000 for those with a profit-sharing scheme).

Who: This pertains to salariés (employees) whose businesses choose to offer this bonus.

When: The bonus can be paid between August 1st and December 31st.

Rent cap – Rent increases will be limited to 3.5 percent per year for existing tenants. Some cities already have in place their own rent control schemes, but the 3.5 percent cap is nationwide.

Who – This affects anyone who already has a tenancy agreement for a property in France (and also affects all landlords who are banned from making big rent hikes).

When – The 3.5 percent cap concerns annual rent increases that fall between July 2022 and June 2023.

Housing allowance – Those who benefit from personalised assistance for housing (APL) will see that increased by 3.5 percent.

Who: This pertains to those who qualify for governmental financial assistance with rent. Typically, this means low-income households. If you are already on APL – around 3.5 million people – the increase will be automatic, if you think you might qualify, apply through your local CAF.

When: The increase comes in your next payment, with the increased rate backdated to July 1st 2022.

Social benefits – The RSA top-up benefit will be increased by four percent (local authorities, who deal with RSA, will receive €600 million to help them finance and allocate this increase). Additionally, those who benefit from the ‘prime d’activité‘ (activity bonus) will see that value raised by four percent as well.

Who: Unemployed people below the age of 25 can qualify for RSA – this pertains to about 1.9 million people in France. The activity bonus is available to low-income workers – about 4.3 million people.

When: Catch-up payments will be in place from August 18th to September 5th. On September 5th, the updated payment will begin to be paid out.

Student grants – An increase of 4 percent for student grants (bourses) for higher education

Who: Students under the age of 28 who qualify for financial assistance in the form of grants. These students must qualify as ‘financially precarious’ for the school year of 2022-2023.

When: September 2022

Back-to-school grants – Families who meet certain income requirements are eligible for an allowance to help cover back-to-school costs – that grant will increase by four percent this year. There will also be an extra €100 subsidy for eligible families (with an additional €50 per child) paid “to those who need it most” according to Finance Minister Bruno Le Maire in an interview with RTL. 

Who: Low-income families with children. You can test your family’s eligibility on the website www.service-public.fr. This aid will impact 10.8 million households.

When: The one time payment will be paid at the start of the school-year in September.

The option to convert overtime days into extra cash – This is encompassed in two measures: increasing the ceiling of tax exempt overtime hours to €7,500 and opening the possibility for companies to buy back RTT days from their employees.

Eligible employees covered by the 35-hour week agreement accrue time in lieu if they work overtime, known as RTT days. Currently this time is taken as extra vacation days, but now employees will have the option to forgo the time off and instead be paid extra.

Who: For the buying back of RTT days, this applies to employees (salariés) who have an RTT agreement with their company.

For the increased cap on non-taxed overtime work, this applies to a range of employees, such as those who have 35-hour per week contracts and have their employer request that they work overtime or those who work beyond their part-time contract amount. You can learn more about whether you have the ability to declare overtime hours HERE

When: The RTT days buyout will run from between January 1st, 2022 to December 31st, 2025. For employees eligible for tax-free overtime compensation, the ceiling of €7,500 will only be in place for the year 2022.

READ MORE: EXPLAINED: Why is France’s 35-hour week such a sacred cow?

Pay rise for public sector workers – public sector pay will get a four percent rise in the index.

Who: Anyone employed in France as a fonctionnaire (eg civil servants, teachers, librarians).

When: This will be retroactive to July 1st

Assistance for some self-employed workers – A reduction in health and maternity insurance contributions will be introduced for low-earning self-employed workers. “Microentrepreneurs” will also benefit from a reduction in their flat-rate contributions.

Who: Self-employed workers whose monthly income does not exceed 1.6 times the minimum wage and who are registered as ‘microentrepeneurs’

When: TBC

The biometric carte vitale –  The Senate introduced this into the purchasing power package, but it is not a benefit. It will involve the implementation of a biometric carte vitale health card to “fight against social fraud” by adding an electronic chip with biometric data on it to health insurance cards. You can read more HERE.

Who: Everyone who is registered in the French health system and has a carte vitale (about 60 million people)

When: Lawmakers will begin plans to implement the plans in Autumn 2022, but it’s not clearly exactly what form the rollout will take.

How much will these measures impact inflation?

Some measures will likely be more effective than others. For instance, the extension of the tariff shield and increase of the fuel rebate in the early fall is largely to thank for France’s inflation level being two points lower than the European average, according to INSEE.

On the other hand, the tripling of the ceiling for the (optional) Macron bonus will likely not make a large difference. This is because it will likely not be widely taken advantage of, as last year only 4 million French people received the optional bonus, with the approximate average of the bonus having been only €500.

The pension changes will impact about 14.8 million people in France. However, according to economist Christopher Dembik, the revalorsation values are based on actual inflation and not on inflation expectations. “These revaluation measures will be too weak by the time they will be implemented,” Dembik said to French daily Le Parisien.

SHOW COMMENTS