London’s Licensed Taxi Trade

Victoria Borwick Excerpts

Wednesday 15th July 2015 Commons Chamber

[Mr Walker]

The hon. Gentleman makes a precise intervention. The Law Commission also called for significant changes to the legal distinction between taxis and private hire vehicles on the grounds that the current system relies too heavily on an imprecise concept of “plying for hire”, which is not defined in statute and has become the subject of a body of case law that is not wholly consistent. In that lies a multitude of problems.

[Victoria Borwick (Kensington) (Con)]

I declare a slight interest, as my husband was running the company that made the taxis when they became fully accessible to the disabled. I have spoken before about my concern for the disabled, so may I ask first whether my hon. Friend agrees that only fully accessible taxis should be allowed to ply for hire on the streets of London? Does he also agree that all vehicles should be subject to the same stringent standards and regulations as our gold standard taxi fleet?

--- Later in debate ---

[Mr Goodwill]

That would be illegal. Criminal record checks, and all the other checks that need to be made before somebody can ply their trade as a private hire driver, need to be carried out, so that would certainly be an illegal transaction.

It is the job of Transport for London to ensure that all its licensees comply with the rules and regulations that govern their industry. I understand my hon. Friend’s desire to raise these concerns on the Floor of the House, but as licensing is the responsibility of TfL, while I might be able to address his points, it is within TfL’s remit to act if necessary.

The taxi industry has played a key role in keeping London moving for many years and has a fine heritage. The addition of the private hire sector has helped to ensure that this form of transport is available to all, particularly supporting those who cannot rely on other public transport services. TfL licenses some 22,200 taxis and 66,200 private hire vehicles making 300,000 trips every day. These vehicles make a vital contribution to London’s economy and help to keep the city moving 24 hours a day, seven days a week. The availability of both taxis and private hire vehicles offers the travelling public real choice. They can either instantly hire a taxi on the street or at a taxi rank, or they can pre-book a taxi or private hire vehicle. When pre-booking, passengers can make an informed choice based on factors such as price, availability and quality.

[Victoria Borwick]

The Minister makes an important point about quantity. We are talking about the free flow of London traffic, and although we have seen this explosion in the number of private hire vehicles, it cannot be said to contribute to the smooth running of London or to reducing pollution levels in London. When considering legislation or regulation, I hope he might consider whether we need all these private hire vehicles. Are they not just polluting and clogging up our streets? As he said, he is fortunate to be healthy enough to ride a bicycle, for which I commend him, but he will be breathing in the fumes of all these private hire vehicles.

[Mr Goodwill]

Some local authorities limit the number of licences they issue, but that is not the case in London. My hon. Friend makes a valid point about how the number of vehicles circulating looking for trade can increase congestion and pollution—and let us not go into the issue of bicycle rickshaws.

London’s tax service is recognised as one of the best in the world, with high vehicle standards, including disabled access and skilled drivers. By learning the world-famous “knowledge” of London, London taxi drivers earn the unique right to ply for hire on the streets of the capital. Private hire vehicles offer a different service, also with high standards, but allowing the customer to choose who they travel with. This combination of taxi and private hire ensures that the needs of as many Londoners as possible can be met. Indeed, while it is easy to flag down a taxi in central London, one would have to wait a long time for a black cab to drive by in some of the suburbs.

The traditional London taxi, or black cab, has become an icon of the city, but time does not stand still and the market is changing. New technologies are providing new ways of engaging taxis and private hire vehicles, and the industry must adapt. Smartphone booking apps are now available for both taxis and private hire vehicles, offering passengers real choice, including faster pick-ups and options for sharing, which can reduce the cost for travellers.

With change, however, come challenges, and TfL, along with other licensing authorities in the country, is faced with the challenge of accommodating 21st century technology in 19th century legislation. My hon. Friend the Member for Broxbourne might be aware that TfL has recently completed a consultation on the regulations that govern private hire vehicles in the capital. This was in response to the developments in the industry I have described, including advances in technology and changes to how people engage and use private hire vehicles. The outcome of the consultation will be known later this year, and some of TfL’s proposals might address some of his constituents’ specific concerns. I hope they do.

I am aware of the major challenges to established businesses being presented by Uber and other new entrants to the market. I can understand the concern of my hon. Friend’s taxi-driving constituents. Like many people, I was made aware of Uber, following the taxi drivers’ protest on 11 June 2014—unfortunately providing priceless publicity for Uber. Indeed, some used Uber for the first time during that protest.

Uber London Ltd has been licensed by Transport for London as a private hire vehicle operator in London since 2012. The company has now applied for and been granted licences in 25 other licensing authorities in England. In order to be granted a licence, Uber must meet the same standards as any other privatised vehicle operator in the local authority area. Therefore 26 different authorities have decided that Uber is a fit and proper company.

I know that the London taxi trade fundamentally disagrees with the view of Transport for London on how Uber calculates a fare. Many members of the taxi trade consider Uber’s smartphone app to be essentially a taxi meter. Taxi meters are, of course, forbidden in London’s private hire vehicles. My hon. Friend may be aware that Transport for London has recognised that the law in respect of this issue is unclear and has applied to the High Court for a declaration. We must now let the court make its decision as the next step in the process.

My hon. Friend may be aware that last year the London Assembly transport committee began an investigation into taxi and private hire services in London. This scrutiny resulted in the transport committee making a number of recommendations to the Mayor and Transport for London on steps they could take to improve taxi and private hire services in London.

The committee was in some cases critical of the role of the taxi and private hire section of Transport for London and I understand that members of both London’s taxi and private hire vehicle trades gave evidence to this committee as to their dissatisfaction with Transport for London’s actions as the licensing authority. This committee is responsible for questioning and scrutinising the actions of the Mayor, and it is not for the Government to comment on local licensing matters or the actions of the committee.

My hon. Friend will be aware that in 2012 the Department for Transport asked the Law Commission to conduct a review of taxi and private hire vehicle legislation. This was against the backdrop of the Government’s red tape challenge and legislation dating back to the early years of Queen Victoria’s reign and the age of horse-drawn Hackney carriages. As we have heard, the advent of the cab was very much earlier. Since that time, there has been additional legislation to allow for the regulation of private hire vehicles, but the law remains complex and outdated.

The Law Commission undertook a very comprehensive review and last year published its final report, which contained recommendations for a modern and simplified structure. The Law Commission’s report provided not only crucial analysis of the problems posed by the current law, but solutions designed to make a difference to both the travelling public and those who work in the industry. Updated and simplified legislation will provide a modern and simple framework, which will in turn ensure public safety and provide the trade with certainty, therefore making growth and competition easier. The Government are currently considering the Law Commission’s recommendations, and we will respond in due course.

It has to be said that the traditional London taxi is not the greenest or the most sophisticated vehicle on the road. Indeed, in April this year, the Office for Low Emission Vehicles announced the launch of a £45 million fund to support the roll-out of ultra-low emission taxis across the United Kingdom. This included setting aside £25 million specifically for the Greater London area to help taxi drivers cover the cost of upgrading to a greener vehicle. The Mayor of London has pledged an additional £40 million, which creates a £65 million fund to encourage the development of the cleanest and greenest taxi fleet in the world.

At the same time, Geely, the company that owns the iconic London Taxi Company, announced plans for a new £250 million state-of-the-art facility to produce the next generation of low-emission London taxis in Ansty, near Coventry. Geely was awarded £17 million from the Government’s regional growth fund to build the facility, which will create 1,000 new jobs and ensure that the London taxi continues to be designed, developed and made in the United Kingdom.

Those measures demonstrate the Government’s support for the taxi trade throughout the country, and mean that the London taxi trade will play a leading role as we meet our climate change obligations.

The Government are aware of the changing landscape of the taxi and private hire vehicle industry, and of the impact that new means of engaging services are having on traditional business models. The Government also support innovation in all sectors of business, including new ways of running businesses, the use of technology, and the sharing economy. There is room in this industry for small and large businesses alike, but, whatever their size, all new market entrants must operate within the legislative framework, ensuring safety and security for the travelling public.

Question put and agreed to.