Transport minister Lam Sai-hung on Saturday said the service quality of some taxi drivers was disappointing, but he expects the situation to improve with the introduction of a licensed taxi fleet system.

The government is expected to approve up to five licences out of 15 applications.

Speaking on an RTHK radio programme, Lam said taxi fleets must maintain their service quality level to keep the licence.

"The Transport Department will monitor the taxi fleets to see whether they are performing well and offer reminders if they are not. In the worst case scenario, we can cancel their licence," he said.

"There's a monitoring system, so I'm confident the taxi fleets will provide a high-quality service and therefore enhance the service quality for the whole taxi industry."

Lam also said the authorities are looking into whether licences are needed for ride-hailing services. He said discussions will be made with the sector and lawmakers in July.