1. Taxis and private hire vehicles (PHVs) are a vital
but often overlooked part of the public transport system. They
serve a number of functions in different areas, from getting people
home from bars and nightclubs in the early hours of the morning
to taking people to and from stations and airports.
They are not just services for the affluent and can be essential
forms of transport for people who cannot afford to run a car.
In some parts of the country, and at some times of day, taxis
and private hire vehicles are the only form of public transport
taxis and private hire vehicles are not always recognised as a
form of public transport, are omitted from many local transport
plans, and barely rate a mention in discussions of Government
2. We decided to undertake this inquiry in November
2010 after we heard about disputes in different parts of the country
involving taxis and private hire vehicles licensed in one district
operating in other areas. We asked for evidence on any issues
of concern relating to the licensing of taxis and private hire
vehicles but the overwhelming majority which we received concerned
cross-border hire. This
issue was the focus of our two oral evidence sessions on 18 January
and 15 March and is the subject of this report. We are grateful
for both the oral and written evidence we received.
Taxis and private hire vehicles:
a quick guide
3. Taxisdescribed in legislation as 'hackney
carriages'operate from ranks, usually situated in city
and town centres, and can be hailed in the street (known as 'plying
for hire'). PHVssometimes known as minicabsmust
be pre-booked and cannot use taxi ranks. Taxis can accept pre-bookings
and effectively operate as PHVs but it is illegal for PHVs to
ply for hire. The Department told us that "there are some
75,000 licensed taxis and 150,000 PHVs across some 300 licensing
authorities in England and Wales".
4. The legal framework within which taxis and PHVs
operate is complex. The two types of service in England and Wales
are covered by separate Actsthe Town Police Clauses Act
1847 for taxis (the "1847 Act") and the Local Government
(Miscellaneous Provisions) Act 1976 for PHVs and to some extent
taxis as well (the "1976 Act")but there are separate
Acts for both services in London
and the Plymouth City Council Act applies to PHVs in that city.
In this report we concentrate on taxis and PHVs in England and
Wales, outside London and Plymouth, although we heard from London
witnesses about the situation there.
5. Taxis and PHVs are licensed by district councils
and other forms of second tier local authorities. Both require
two licencesfor the car and the driverbut, in addition,
PHV operators must be licensed. Local authorities have considerable
discretion in setting licensing conditions. The Department for
Transport has published voluntary guidance on licensing best practice
and we were told that the department "takes every opportunity
to urge licensing authorities to adhere to it".
Local authorities are legally obliged to ensure that money raised
from licensing taxis and PHVs is spent on their control and supervision;
some witnesses questioned whether councils always complied with
Cross-border hire: issues raised
6. Several forms of the cross-border hire issue were
raised with us. The first involved PHV firms licensed in one district
operating routinely in another area. Sefton-based PHV firm Delta
Taxis operates throughout Merseyside using "a fleet spread
out across the whole of our multi-borough zone that can respond
to telephone requests quite literally within seconds".
Without referring to Delta Taxis directly, Unite the Union's Tommy
McIntyre complained about "a particular company" which,
although based in Sefton, did 55% of its work in Liverpool. He
said "they are not actually paying any money whatsoever towards
the licensing regime in Liverpool".
Numerous similar examples were provided to us, often involving
PHVs licensed by rural authorities operating principally in a
near-by town or city.
For example, Gavin Sokhi of Skyline Taxis drew attention to the
situation in Milton Keynes, where he claimed "drivers from
other licensing authorities are being licensed at lesser standards
and then working in [the city]".
7. A second issue concerns the activities of the
former Berwick District Council (now subsumed into Northumberland
County Council) which licensed a number of taxis which were operated
as PHVs elsewhere in the UK. The GMB said:
Anyone could have driven a Berwick taxi and that
taxi could have been a modernised death-trap, and nobody would
have been able to do a thing about it, as some of these vehicles
were permanently working hundreds of miles away from their licensing
David Wilson, the former licensing officer at Berwick,
refuted the suggestions that the licensing standards at Berwick
were low and that the local authority did not engage in enforcement
activity. He said
that, in the local authority's view, the legislation did not permit
a licence to be refused on the grounds that a taxi was going to
be operated as a PHV in another locality.
This issue has been subject to litigation and the court has held
that a taxi licence should not ordinarily be granted if the taxi
is going to be used in this way.
8. We did not hear of any other examples of the "Berwick"
problem, but the GMB raised the issue of Adur Council licensing
a PHV operator in Brighton. In GMB's view, Adur had "licensing
criteria of a lower standard to that in Brighton and Hove"
and Adur's decision has enabled a PHV firm to "integrate
vehicles into their fleet which are licensed to a lesser standard,
drivers who have no knowledge of Brighton and Hove, and/or drivers
who can't be bothered to meet the high entry criteria demanded
by the local licensing authority".
Adur and Worthing Councils said there were legitimate reasons
for differences in standards between local authorities and pointed
out that the law on whether local authorities could license PHV
operators in a different district was a "grey area".
9. Finally, the prohibition on sub-contracting of
jobs by PHV firms was raised with us, particularly by Tyneside-based
Blue Line Taxis, whose litigation established the current case
law in this area.
The 1976 Act prohibits PHV operators from transferring work to
an operator in a different district but this prohibition does
not apply to London PHVs.
Blue Line Taxis said:
If we accept a booking as a North Tyneside Council
operator we cannot lawfully request assistance from a Newcastle
operator even when it would be entirely in the best interests
of our customer for us to do so and despite there being no credible
purpose behind the laws which prevents us from doing so. Nor can
we transfer a booking from our own North Tyneside office to our
The Department noted that sub-contracting could be
useful in "emergency situations" such as when a car
breaks down on an airport pick-up. It described the illegality
of sub-contracting as "anomalous" and said it wished
to address the issue when PHV legislation was next reviewed.
Is new legislation necessary?
10. The issues raised with us about cross-border
hiring, and the increasingly complex pattern of case law on taxi
matters, raise questions about the legislation applying to taxis
and PHVs and the differences in licensing standards between different
local authorities. The National Taxi Association said it did "not
believe that there is any pressing need or indeed any at all for
a change in legislation" applying to taxis. It drew attention
to other elderly pieces of legislation which it argued were generally
thought to be working well.
This was a minority view. Most other witnesses argued that the
legislation applying to both taxis and PHVs was in need of reform.
11. There were numerous suggestions of relatively
modest changes to the legislation to clear up specific areas of
ambiguity. Unite, for example, proposed a new clause to be added
to the 1976 Act which would require PHVs to return to their home
district after completing a job in another area. This "simple
change", based on Scottish legislation,
would put an end to PHVs waiting for jobs outside of their home
area. David Wilson
sent us a schedule of changes to the 1976 Act which he recommended
to address all of the issues relating to cross-border hiring and
enforcement raised by local authorities.
The Minister suggested that the Berwick issue could be dealt with
by establishing a linkage between the licensing district of a
taxi driver operating as a PHV and that of the PHV operator for
which he or she is working.
12. Other witnesses took the view that the two principal
Acts needed to be radically overhauled or replaced altogether.
James Button, the author of a textbook on taxi law, said:
The existing law is not fit for purpose. The
Town Police Clauses Act 1847 predates motor vehicles and telephones;
the Local Government (Miscellaneous Provisions) Act 1976 predates
mobile telephones and the internet. Modern systems are not covered;
business finds it constrictive, preventing business expansion;
the public (the users) are confused; and ultimately, the purpose
of licensing of hackney carriages and private hire vehicles, which
is to protect public safety, can be thwarted.
Liverpool City Council explained how the use of GPS
technology by PHV operators enabled them to "control hundreds,
even thousands, of vehicles efficiently by identifying a vehicle
which is near to a booking request and dispatching that vehicle
via a computer terminal located in each vehicle".
The National Private Hire Association made a similar point about
how modern technology had outpaced the terms of the legislation
and argued that it did not want "to spend the next 20 or
30 years wasting time and costs in the Administrative Court trying
to make sense" of the 1976 Act.
Similar sentiments have been expressed by judges who have heard
cases brought under the 1976 Act in particular.
13. The Minister, Norman Baker MP, conceded that
taxi legislation was "complicated", "archaic"
and had "been built on, higgledy-piggledy, over the years".
He also drew our attention to another flaw in the 1976 Act, following
a finding of the district auditor in respect of Guildford Borough
Council that fees for drivers' and operators' licences cannot
legally cover enforcement activity.
Mr Baker told us that he had asked the Law Commission to consider
looking at the legislation and that, if this suggestion was accepted,
the Commission might report back "with an idea of what we
might sensibly do" within 12 to 18 months.
14. In our view, the case for a thorough overhaul
of the legislation relating to taxis and private hire vehicles
is irresistible. The legislation relating to taxis is hopelessly
out of date, with its references to horse-drawn vehicles, "stage
coaches" and the regulation of the "placing of cheek
strings to the carriages".
Both principal Acts take no account of modern developments, such
as the widespread use of mobile telephones and the internet, which
have transformed the interaction between customers and operators
and eroded the traditional distinction between taxis and private
hire vehicles. The proliferation of case law to resolve ambiguities
in the legislation demands Government attention.
15. It remains to be seen whether the Law Commission
will wish to take up the Government's suggestion that it study
taxi and PHV legislation. However, we are concerned that in referring
the issue to the Commission the Government has not properly appreciated
the pressing need to reform legislation which is proving increasingly
contentious and hard to implement effectively. Nor are we persuaded
that the Commission is the right body to look at the law in an
area where the policy context is so sensitive. As our inquiry
has shown, there are plenty of ideas circulating for reforming
the legislation and numerous suggestions of how taxis and private
hire vehicles should be organised. We recommend that, instead
of referring reform of taxi and PHV legislation to the Law Commission,
the Government should engage with the trade, local authorities
and users about the objectives of future legislation on taxis
and private hire vehicles and commit to overhaul that legislation
during the course of this Parliament. Once these objectives are
decided, the detailed work to frame legislation and guide it through
Parliament should begin. This need not involve primary legislation:
we consider that the swifter legislative reform order procedure
could be used in this case.
1 Ev w57-60, 81-82. Back
Ev w71 paragraph 3.4 and 64 paragraph 3.1. Back
For example Q106. Back
For other issues, particularly to do with London and the Equality
Act 2010 see for example Ev w17-20, 38-39, 46-53, 60-63 and 67-70. Back
Ev 38, paragraph 8. Back
The Metropolitan Public Carriage Act 1869 for taxis and the Private
Hire Vehicles (London) Act 1998. Back
For Plymouth see Ev w41-43. Back
Ev 39, paragraph 15. Back
Section 70, 1976 Act. Back
For example Q10 and Ev 44-45. Back
Ev 42. Back
For example Ev w3-6, 26-29, 31, 35, 39-41, 54-57, 78-79, 82-84,
Ev 51, paragraph 2.1. Also see Ev w20-22, 30-31, 32-33. Back
Q69 and see Ev 69-71. Back
Ev 67 paragraph 3.3. The relevant case is Stockton-on-Tees
Borough Council v Fidler  EWHC 2430 (Admin). Back
Ev 52, paragraphs 3.3-34 and see Q6. Back
Ev w88. Back
Ev 58, paragraph 4. The case is Shanks vNorth Tyneside Borough
Council  EWHC Admin 533. Back
Ev 39-40, paragraphs 29 and 31. Back
Ev 58, paragraph 8. Back
Ev 40, paragraphs 30-31. Back
Ev 90, paragraph 14. Back
For example Ev w1, 2, 28 paragraph 2.1, 31, 32 paragraph 1, 34
paragraph 3(ii), 37 paragraph 7 and 41 paragraph 20. For support
for the NTA see Ev w29-30. Back
Q25 and Qq218-19. Back
Q2 and Ev 81, paragraphs 2.3-2.4. This proposal was supported
by Liverpool City Council, see Ev 55, paragraph 4. Also see Ev
50, 53 paragraph 8.3. Back
Ev 69, paragraph 6.5 and Ev 72-78. Back
Ev w77. Back
Ev 56, paragraphs 7-10. Back
Ev w44-45. Also see Ev w84 paragraph 5.1 and Ev w88. Back
See Ev 46, 67 paragraph 2.1. Back
Qq199, 201. Back
Q203 and Annual Audit Letter, Guildford Borough Council, Audit
2009/10, Audit Commission, Nov 2010, p9 and see Ev w47. Back
Section 68 of the 1847 Act. Section 38 explicitly distinguishes
between hackney carriages and stage coaches. Back