Law Commission proposes major shake-up of taxi and PHV licensing

The Law Commission has proposed a major shake-up in the licensing of taxis that can ‘ply for hire’ and private hire vehicles (PHVs) that must be pre-booked, but argued that the distinction between the two should remain.

In its paper Reforming the law of taxi and private hire services, the Government’s legal advisory body suggested that all vehicles should be subject to national minimum safety standards.

Additional local standards, above the national standards, would continue to apply to taxis. This might relate, for example, to topographical knowledge and vehicle requirements.

But for private hire vehicles, only the national standards would apply and there would be no scope for additional local standards. The Law Commission nevertheless asked in the consultation about possible exceptions where local private hire standards may be retained, for example in respect of signage.

The Law Commission estimated that the national standards would replace more than 340 sets of local regulations.

“This will reduce the burden on business because, once appropriately licensed, a private hire firm could work freely across the country, without geographical or licensing restrictions,” the advisory body said.

“This would contribute to widening consumer choice and to making services cheaper and more competitive.”

The Commission also proposed making it easier for private hire services to operate on a national basis. “We suggest private hire operators would no longer be restricted to accepting or inviting bookings only within a particular locality; nor to only using drivers or vehicles licensed by the same licensing authority,” it said. ‘Sub-contracting would be allowed, as is already the case in London.”

However, the advisory body also called for more enforcement powers for licensing against out-of-borough vehicles and drivers.

Other proposals in the paper include:

  1. London would be regulated under the same flexible framework as the rest of England and Wales.
  2. Licensing authorities could no longer limit the number of taxi licences.
  3. Disability awareness training for drivers.
  4. Introduction of a statutory definition of “plying for hire” (but without changing it in substance).
  5. Weddings and funeral cars would no longer be exempted through primary legislation.
  6. Allowing leisure use of taxis and private hire vehicles.
  7. Bringing more vehicles within the licensing system (including for example limousines, motorbikes and pedicabs) – but giving the Secretary of State and Welsh Ministers power to make exclusions, and to set separate standards, in respect of different categories of vehicle.
  8. Clearer exclusions for volunteers and other services where transport is not the main service provided, such as childminders.
  9. Powers for government to issue binding statutory guidance to create greater consistency in how taxi and private hire legislation is applied.

The consultation also asks questions about:

  • a new category of wheelchair accessible vehicles;
  • extending operator licensing to taxi radio circuits;
  • possible use of the term “taxi” in respect of private hire services if used in phrases like “pre-booked taxi only”;
  • reintroducing a (revised) contract exemption;
  • improving the enforcement powers of licensing officers; and
  • a new “peak time” taxi licence that could only be used at particular times of day as decided by the licensing authority.

The Law Commission recommended that a new Act of Parliament should be introduced for taxis and private hire serivces, in a bid to clarify and simplify the existing law and to promote more consistency in bottom-line safety standards. The legislation would also help deregulate aspects not linked to protecting public safety in order to encourage more competitive services.

However, it insisted that it was not proposing major changes to the way in which licensing is administered and enforced.

"As now, local authorities would be responsible for issuing licences, and for taking action (with the police) against those who break the law," the Commission said. "In respect of taxis, local authorities would continue to have a standard-setting role, over and above the national minimum safety standards."

Copies of the consultation, a summary and the impact assessment can be found on the Law Commission’s website here. The consultation is open until 10 August 2012. 

Frances  Patterson QC, the Law Commissioner with responsibility for the project, said: “Our review provides a great opportunity to streamline and improve taxi and private hire legislation and we look forward to engaging with as  many people as have an interest in this varied and important transport sector.”