Taxi and private hire vehicle licensing in England

Taxi and PHV licensing law in England dates back in some instances to the 19th century – though the origins of the taxi trade go much further back to the 17th century. There was some update to the licensing law in the 1970s and more recently in London in the 1990s, but since then there has been no national legislative change, despite significant developments in technology, travel behaviour and customer demands.

This has led to an increasing number of calls in recent years for wholesale reform of the licensing law. This was really kick-started in 2012-14 by the Law Commission, which published a comprehensive overview of the industry and how it should look going forward. It also published a draft bill for consideration by the Government. Although the Coalition Government accepted a small number of the Commission’s recommendations and legislated for them in 2015, nothing further has been done.

The entry of Uber into the London PHV market and the way it has transformed it, has given impetus to the calls for reform. There are some who believe that the advent of Uber and other smartphone app-based technologies is a chance to completely rethink what the industry should look like going forward as a consumer-led, deregulated system where the differences between taxis and PHVs disappear. Others, while welcoming some of the benefits from these app-led providers in terms of consumer choice, caution against unleashing a ‘free for all’ and are calling for better regulation, standardisation across the country and more powers for local licensing authorities to cap PHV numbers and prevent cross-border hiring.

Reports by the All Party Parliamentary Group on taxis, the Urban Transport Group, the Institute for Economic Affairs and others followed the work of the Law Commission and led to differing conclusions and recommendations for the future. In July 2017 in response to these reports and the changing industry particularly in and around London, the Government set up a working group to consider regulatory issues and remedies for the industry. This ‘Task and Finish Group’ reported in September 2018, recommending national licensing standards, limits on cross-border working, powers to cap licenses under certain circumstances and higher safeguarding standards. These reports and their recommendations are discussed in the substance of this paper.

Please note that this paper does not look at the wider implications of the ‘gig economy’ and the employment rights and other issues which have been raised with regards to app-based operators like Uber. For an overview of some of these issues, see the Library’s Second Reading blog, “Employment rights in the gig economy”, 26 June 2017. More generally, further information on roads- and traffic-related issues can be found on the Roads Briefings Page of the Parliament website.