| Previous Section | Index | Home Page |
Linda Gilroy (Plymouth, Sutton) (Lab/Co-op): I pay tribute to my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) and the other members of the Transport Committee for the work that they have done in closely scrutinising the OFT's report. I share many of the concerns that the Committee expressed about the quality of that report and the conclusions it reached.
Taxis and public hire vehicles play an important part in the lives of most of our constituents, especially in a city such as Plymouth, which has more than its fair share of low-income, non-car-owning households, with many vulnerable and disabled people who depend on such transport. We also have a lively night-time economy, in which taxis and private hire vehicles play an important part in getting people to and from the clubs and pubs. We also have a big student population and I recognise the comments made about Cambridge. At times when most students have gone home, demand for such vehicles is lower, but at other times there are not enough to go round. It is important to consider provision at the appropriate time in the season.
Cost is important, but so are the issues of safety and reliability. At least the Government have not opted for big bang deregulation in response to the OFT report. It will be up to local authorities to make sense of the local situation, in the context of their local transport plans. In Plymouth, the situation has always presented a challenge to council officers and councillors, and I wonder how they will respond to some of the challenges that the issues will produce locally in future.
I have two particular concerns, and I hope that my hon. Friend the Minister will be able to respond to them when he winds up. Plymouth has its own legislation on private hire trade issues—the Plymouth City Council
24 Jun 2004 : Column 1518
Act 1975. The city council is unique in having the power to grant licences for the purpose of private hire, which, technically, gives it the right to limit private hire vehicle numbers. In practice, it chooses not to do so. However, local people are well aware that the council has that capacity and some in the private hire vehicle operator community have sometimes called for it to exercise that power.
Like my hon. Friend the Member for Crewe and Nantwich, I make wide use of taxis and private hire vehicles in my constituency. Over the years, a number of concerns have been raised with me that should leave us with no illusion that the relatively free market in the private hire vehicle sector compared to the taxi sector is by any means perfect. One of my constituents wrote to me about her current experiences of that trade. Her letter gave me cause for concern that a similar situation could arise for taxis if numbers are derestricted.
"For the last two years I have been a private hire driver in Plymouth. For the first few months, it was great".
Then things became difficult for various reasons. She continued:
"Things started to pick up gradually and then started to go downhill again. I have realised now just what it is. There are too many private hire drivers and more pouring in each month."
When she phoned Plymouth city council, she was "absolutely amazed" to discover that there was no regulation to stop the issue of private hire licences, which was, she said:
"Something to do with freedom and democracy. Well, I'm all for that but not if it affects my weekly income."
She asked why people are allowed to go through the taxi schools run by some of the fleet operators in Plymouth when there is no work for them and existing drivers struggle to meet their bills. She described the difficulties in meeting those bills:
"If we were seeing small losses that would be acceptable, but in two years I have lost between £250-£300 per week and I put it down largely to the saturation of the market."
It is something to do with the market, but it is also to do with the way that some fleet operators suck some of the people they put through their driving schools into leasing vehicles with high maintenance costs. I am worried that we could have the same unrestricted market if we derestrict the numbers for hackney cabs.
Will the Minister look into that situation? If he goes ahead with the proposals in his action plan, will he ensure that the OFT and the Department of Trade and Industry give as much attention to the unfair competition aspects in the operation of the private hire market as they give to deregulation? Will he consider whether his Department could alert local authorities to look into such issues? He may tell me that they already have such a role, although I am not aware of it. However, if there is to be a greater move towards deregulated markets, perhaps he could provide guidance for local authorities on how to deal with such issues in the framework of competition legislation.
Secondly, will the Minister look into the position of the very worried black-cab drivers who have invested a considerable amount in their taxi business? They are concerned about the impact of the changes on the value of their plates and the existing trade in plates. Unless local authorities are allowed to manage change sensibly,
24 Jun 2004 : Column 1519
people who count on that as part of their retirement fund could face a sudden loss that might hit them very hard indeed.
I should like the Minister to say to what extent local authorities will be able to take account of such positions, given that, under the Government's proposals, they will have not only to review regularly but justify their decisions to continue to restrict licences. An article published in the Financial Times earlier this year shows just how unfair that would be. It was written by John Kay, who says:
"When licences are restricted, they acquire a value".
That value can vary. He says that
"in Crawley or Wycombe you may have to invest up to £50,000."
I suspect that the figure is probably a little less in Plymouth. He continues:
"The potential profit a taxi driver might derive from restrictive licensing through higher fares and fuller cabs is absorbed in the costs of servicing the loan needed to acquire the licence. Today's taxi drivers are no better off than if the restrictions on numbers of cabs had never been introduced . . . who does benefit from quantity licensing? The gains go to the people who were in business when the restrictions were introduced".
So a problem could arise if local authorities had difficulties in justifying deregulation.
We are all vulnerable with regard to our safety and, often, to our ability as consumers to know whether we are being taken all round the houses to get where we want to go. My hon. Friend the Member for Eltham (Clive Efford) referred to the difficulties that people face in trying to bargain over price; but, equally, if people turn up in a city or community with which they are not familiar, they do not know whether they are literally being taken all round the houses to get to their destinations. So there is scope for abuse.
I hope that the Minister will bear in mind the points that I have raised in ensuring that taxis and private hire vehicles can continue to serve our constituents' interests. On balance, at best, the benefits of implementing the sort of deregulation that the OFT envisages might be described as a cake that is not worth the candle and, at worst, such deregulation could open up a very nasty new can of worms.
4.52 pm
Mr. David Lepper (Brighton, Pavilion) (Lab/Co-op): I, too, congratulate my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), who is the Chairman of the Transport Committee, and the members of her Committee on their work—I was going to say, "for the demolition job that they have done", but it is, in fact, not a demolition job but a systematic, step-by-step taking apart of a wholly unsatisfactory piece of research by the OFT. We are all indebted to my hon. Friend and her Committee for the way in which they have approached the OFT report.
I will declare an interest. I am one of the few people in the country who not only does not drive, but has never learned to drive. I imagine that that can be said of few hon. Members. So to do my job—and, indeed, to do the job that I did before I was elected to the House—I have had to rely on public transport. I welcome the fact that the Government say in their response to the report that
24 Jun 2004 : Column 1520
they consider taxis and private hire vehicles to be an integral part of local transport provision and that proper account should be taken of them in the local transport planning process. Like many other people, I regard taxis and private hire vehicles as important parts of public transport.
I echo the comments that my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy) made about the investment that so many taxi drivers have made in setting up in the trade that they are engaged in. Given that investment, they must pay huge attention to the quality of the vehicle and its maintenance. The job that they do can be risky. My hon. Friend the Member for Eltham (Clive Efford) mentioned the ridiculous proposals about haggling over prices that were recommended as part of the OFT report. I would recommend that members of the Office of Fair Trading group that carried out the report come to West street in my constituency on a Saturday night and try to haggle at the taxi rank. I wonder how long they would last and whether they would be successful in getting a cab or would be set upon by others in the queue.
For taxi drivers themselves the job can often be risky. They do not know who they will be picking up late at night in our big cities—whether at a rank, when they are hailed or when they are sent in a private hire vehicle in response to a telephone call. All of us may well have heard from taxi drivers who, having taken a fare to a destination, are told by the passenger, "Sorry, mate. I haven't got any money with me." They can then get into difficulties trying to get the fare that they are rightly owed.
The OFT report shows no understanding of what the taxi trade is about and totally disregards the work that is going on locally in so many places to ensure that the quality of service offered by the taxi fleet is high. Let me put the report into the context of what has happened in my local authority area. Over the past three or four years, the taxi trade in Brighton and Hove has been through two upheavals. Two licensing authorities—Brighton and Hove—were eventually brought together uneasily when we became a unitary authority. Some leeway in the time scale was given for that process, but it caused concern and disruption to the livelihood of some taxi drivers.
Just a year or so ago, the licensing authority commissioned Halcrow to carry out research into significant unmet demand in the Brighton and Hove area. As we have heard, Halcrow not only carried out some work for the OFT but usually conducts research for local licensing authorities. There was haggling locally between the trade and council officers, but a plan was agreed as a result of the Halcrow report for the managed growth of the trade over the following few years. That agreement was not necessarily reached easily, but everyone knew where they were.
Then, in a matter of months, the OFT's report came along, disregarding completely the detailed local negotiations that went on all over the country of the kind that I saw from a slight distance in my constituency. The report caused a shockwave sufficient to bring out 270 drivers in the Brighton and Hove area in a convoy in protest through the city. I am not sure whether that was the best way for them to make their
24 Jun 2004 : Column 1521
point, but that was what they decided to do. Some 30 or 40 came up here to discuss the report and my views on it with them.
Managed growth is the key to a successful taxi fleet as part of the public transport network in any area. The people best suited to make decisions about the form that that managed growth should take are those on the local council and the local licensing authority, in consultation with local representatives of the taxi trade. In that way, we can end up with a system that is more likely to best suit the needs of the area. The underlying mistakes of the OFT's report—there were lots of mistakes—were to assume that one system was right for everywhere in the country, and to overlook totally the likely negative results of the delimitation of numbers.
I welcome the response to the OFT report. I also welcome the Department for Transport's decision that the delimitation recommendation at least should not proceed and its adoption of a more cautious approach than the OFT would have liked to many other recommendations. The taxi trade—I include in that the private hire trade—wants some certainty about the future. It does not want to think that every two or three years there will be another revision of how it does things. I think that local authorities want that certainty as well so that they can truly make their taxi fleets and private hire vehicles part of their local public transport network.
This is the second time in a couple of years that the OFT has considered an activity that is a business and a service. I also have in mind its report on community pharmacies. There are serious questions to be asked about the way in which it considers service industries of any kind. It shows glaring ignorance in both reports of the impact, or the likely impact, of its recommendations on the lives of the communities that we are here to represent. Although I welcome the response and, more cautiously, the approach adopted by the Department, there are wider issues on the remit of the OFT that might also need consideration.
5.2 pm
| Next Section | Index | Home Page |