The playing field between taxis and ride-hailing services such as Uber and Grab is "not quite level", said Prime Minister Lee Hsien Loong yesterday, adding that the Government will look further into this.
The taxi sector is still subject to some extra rules - for example, cabbies must clock a minimum mileage daily and statutory requirements make operating taxis more expensive, he said.
"But then I remind the taxi drivers - you also enjoy some advantages. As drivers told me, they can 'sweep the floor'... that means you can pick up from the kerb. Uber and Grab cannot," he added.
"There are other advantages too. We will progressively sort all these things out. But I think we all know that we can't stop progress," he said at his National Day Rally.
He cited apps such as Uber and Grab as examples of how industries and jobs are being disrupted by technology and globalisation. He said that while Singapore must embrace disruption to stay ahead, it will help incumbents adapt.
Mr Lee said of Uber and Grab: "You open an app, it matches you to the nearest car... no need to book a cab by phone, no need to hail a cruising cab along the street." He said the apps also analyse travel patterns, and adjust fares to match supply and demand.
Despite the disruption these apps have caused worldwide, and the taxi industry saying its business has been hit, commuters are benefiting - "better service, more responsive, faster", he added.
Noting that cabbies in cities such as London, Sydney and Jakarta have staged protests seeking the blockage of these new services, Mr Lee said Singapore could close itself off, ban Uber and Grab, and impose restrictions to protect the "old ways".
"But we will be left behind and our commuters will lose out, and our economy will suffer. The other way is to embrace change, let the disruption happen... but help the incumbents, and especially help the taxi drivers, to adapt to the changes."
Mr Lee said this is being done, by updating rules to foster fair competition, while protecting commuters, and requiring drivers - whether cabbies or those under Uber or Grab - to have proper insurance and clean records.
In April, new regulations were announced, requiring Uber and Grab drivers to obtain a vocational licence by the first half of next year. Cars used for private hire must also be registered and be marked with a decal for easy identification.
Mr Lee said he knows quite a few cabbies who are anxious about their livelihoods. He said he told cabbies at a grassroots event: "I said you can also drive for the other side. They said yes but we have to work hard. But they can still make a living."
Taxi drivers here have been level-headed about the competition and made useful recommendations to level the playing field, he said. Some also welcomed the competition, which has caused taxi firms to take drivers "more seriously", responding with better offers and new technology, he added.
Mr Lee said: "Even Uber and Grab are going to be disrupted, and the next round may be no drivers - driverless cars running a taxi service." Next year, Singapore will start a trial of driverless taxis in one-north.
National Taxi Association executive adviser Ang Hin Kee said requirements such as taxi availability standards - that require cabbies to clock a minimum mileage and ply the roads during peak hours - should be reviewed.
"The private-car hire services should adopt similar vehicle standards (as taxis) on safety and emissions," he added.