Struggling taxi drivers in the southern city can look forward to another 645-yuan (US$81) subsidy every month from their companies to help them cope with rising oil prices.

This is the third time that help has been offered to drivers in the city, according to Shenzhen Transportation Bureau.

The government agency requested that the taxi companies subsidize each taxi driver with 500 yuan (US$62.5) each month starting from last August.

It began using a new method on April 1 that required the taxi companies to reduce the monthly rental fee of each taxi driver by 815 yuan (US$101). The previous plan was waived on the same day.

"It's good news for us. We are facing a tough situation while the oil prices keep rising. Some of my colleagues are considering quitting when their contracts expire this year," said a driver surnamed Liu who works for Shengang Taxi Company, one of the biggest taxi companies in the city.

However, the subsidy plans can hardly offset the economic losses incurred by taxi drivers.

Oil prices on the Chinese mainland have been raised seven times in the past 16 months.

In Shenzhen, regular petrol costs 5 yuan per liter (US$0.63) following the latest price hike on May 24. However, it cost only 3.95 yuan (US$0.49) in March 2005.

Usually a taxi driver consumes 50 liters of regular fuel a day, which means he will spend an extra 50 yuan (US$6.25) a day, or 1,500 yuan (US$187.5) a month , said Liu.

"We will feel relieved if the companies can follow the government's instructions, but in some companies, some drivers complain that they don't get the subsidies," he said.

A bureau official told China Daily that the taxi companies have the means to give their drivers the subsidy. "It's hard for the government to provide such a big financial subsidy. The companies can handle it," he said.

The bureau will regularly check companies to ensure they subsidize the drivers, he added.

Taxi fares in the city are the most expensive on the mainland, costing 12.5 yuan (US$1.57) for the first three kilometers and 2.4 yuan (US$0.3) for each kilometer afterwards.

However, monthly rental fees for drivers are also the highest. Normally a company charges 600 yuan (US$75) for each taxi a day, or 18,000 yuan (US$2,250) a month.

(China Daily July 4, 2006)