Taxis and private hire vehicles

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1 Taxis and private hire vehicles Standard Note: SN/BT/2005 Last updated: 9 June 2009 Author: Louise Butcher Section Business and Transport This note covers the licensing arrangements for taxis and private hire vehicles and their drivers. Standard Notes are also available on disabled people and taxis (SN/BT/601), the carrying of guide dogs by taxis and PHVs (SN/BT/1899) and the OFT report on taxi numbers (SN/BT/2772). The present law varies depending where one is. In England and Wales, outside London, taxis (hackney carriages) are licensed by district councils under the Town Police Clauses Act 1847 or that Act as amended by the Local Government (Miscellaneous Provisions) Act All taxis and their drivers must be licensed. Private hire vehicles (PHVs), more commonly referred to as minicabs, drivers and operators are subject to licensing if a district council has adopted Part II of the 1976 Act (most have) or has similar provisions contained in a local Act. The licensing conditions that are applied to taxi and PHV drivers and the local conditions of vehicle fitness are for each council to decide, so can vary considerably from area to area. Taxis, which are the only vehicles permitted to ply for hire, are normally subject to a stricter regime than the minicabs. In London, the taxi legislation dates back to the nineteenth century, but the main licence conditions are made under the London Cab Order The minicab trade in London is licensed by regulations made under the Private Hire Vehicles (London) Act The Department for Transport publishes best practice guidance for local licensing authorities; and is currently consulting on revisions to that guidance. The consultation will be open until 28 July This information is provided to Members of Parliament in support of their parliamentary duties and is not intended to address the specific circumstances of any particular individual. It should not be relied upon as being up to date; the law or policies may have changed since it was last updated; and it should not be relied upon as legal or professional advice or as a substitute for it. A suitably qualified professional should be consulted if specific advice or information is required. This information is provided subject to our general terms and conditions which are available online or may be provided on request in hard copy. Authors are available to discuss the content of this briefing with Members and their staff, but not with the general public.

2 Contents 1 Background 2 2 Licensing in England and Wales, outside London Taxis Private hire vehicles (PHVs) 5 3 Licensing in London Taxis Private hire vehicles (PHVs) 7 4 Touting 9 5 Fares 9 6 Scotland 10 1 Background The regulation of the taxi industry could be said to have begun in 1636 under King Charles I, who was concerned about congestion in the City of London. He issued a proclamation restricting the number of hackney coaches to 50 and preventing them from carrying passengers less than three miles. In 1654 Oliver Cromwell authorised the establishment of the Fellowship of Master Hackney Coachmen, leading to the present day definition of hackney carriage. The present licensing system is a little more modern but much of it does date back to the last century. There are basically two trades providing driver and car hire: taxis or the old fashioned hackney carriage, and private hire vehicles (PHVs), which are also referred to as minicabs. Taxis ply for hire from taxi ranks and can be hired in the street whereas minicabs must be pre-booked by telephone or calling in person at an office. There is a large market overlay between taxis and PHVs. An increasing proportion of taxis undertake pre-booked and contract hirings, and PHVs are not infrequently booked immediately before hire (e.g. at supermarkets) so being used in a way almost undistinguishable from plying for hire. The dividing line between the two trades has therefore become increasingly blurred. The present regulatory arrangements governing taxis and PHVs have grown up by historical accident rather than design. The law has different rules for taxis and PHVs and varies within and outside London. The trade is continually evolving and technological change has had marked effects. For example, the increasing use of radio booking systems and the growing use of portable telephones may lead to the erosion of the hailing of cabs in the street. The present law varies depending where one is. In England and Wales, outside London, taxis are licensed by district councils under the Town Police Clauses Act 1847 or that Act as amended by the Local Government (Miscellaneous Provisions) Act All taxis and their drivers must be licensed. Minicabs, drivers and operators are only subject to licensing if a district council has adopted Part II of the 1976 Act or has similar provisions contained in a local Act. In London, the taxi legislation dates back to the last century, but the main licence 2

3 conditions are made under the London Cab Order The minicab trade in London is licensed under regulations made under the Private Hire Vehicles (London) Act The concern over the varying standards and requirements covering different types of vehicles and in different areas led to the then Conservative Government publishing a consultation paper in October The Government did not present any of its own conclusions in the green paper but said it was particularly interested in receiving comments on whether taxis and PHVs should be licensed at all, and if so under what system. The Government appeared to favour some type of regulation, on the grounds of protecting the safety and security of passengers, and providing accessibility for people with disabilities. The House of Commons Transport Select Committee reported in March It argued that there was no justification for the existing difference between licensing regimes in London and in the rest of England and Wales and recommended that a revised two tier system should be introduced nationally. It proposed, however, that the distinction between taxis, which are allowed to ply for hire, and PHVs, which may not, should be retained. 2 The Conservative Government agreed with these recommendations in principle. Proposals for the future of the taxi and PHV trade were announced by the then Transport Minister, Steven Norris, in February Amongst other things, Mr Norris announced that minicabs in London would be subject to a form of control similar to that operating outside London. This was largely for reasons of public safety and would include vehicle safety checks, operator licensing and criminal record checks for drivers. Taxis would continue to have the exclusive right to ply for hire in the street and at ranks and PHVs would continue to be booked in advance. Although some changes were made to the taxi and PHV legislation by Order under the Deregulation and Contracting Out Act 1994, changes to the system to regulate minicabs in London required primary legislation. The Private Hire Vehicles (London) Act 1998 was introduced as a Private Members' Bill by Sir George Young, with the support of all political parties and the Labour Government. The Act introduced the licensing of minicabs in London and applies to minicab operators, drivers and vehicles. 2 Licensing in England and Wales, outside London The licensing conditions that are applied to taxi and PHV drivers and the local conditions of vehicle fitness are for each council to decide, so can vary considerably from area to area. Local councils are entitled to charge a fee that it considers reasonable to cover the costs of administration and issue of the licence under section 53(2) of the 1976 Act: Notwithstanding the provisions of the Act on 1847, a district council may demand and recover for the grant to any person of a licence to drive a hackney carriage, or a private vehicle, as the case may be, such a fee as they consider reasonable with a view to recovering the costs of issue and administration and may remit the whole or part of the fee in respect of a private hire vehicle in any case in which they think it appropriate to do so. Under section 39 of the Town Police Clauses Act 1847 the clerk to the commissioners was entitled to claim not more than five shillings for a hackney carriage licence: DoT, Taxis and PHVs: a consultation paper on the future of the taxi and private hire services in England and Wales, October 1993 Transport Committee, Taxis and Private Hire Vehicles (fourth report of session ), HC 239, 30 March 1994 HC Deb 22 February 1995, c189w; details were given in the Government's response to the Transport Committee, see: Cm 2715, February

4 XXXIX. For every such Licence there shall be paid to the Clerk of the Commissioners, or other Person appointed by them to receive the same, such Sum as the Commissioners direct, not exceeding five shillings. 2.1 Taxis A taxi driver has to satisfy two licensing bodies: the Driver and Vehicle Licensing Agency (DVLA) and the local authority. Drivers need an ordinary driving licence covering category B which allows them to drive vehicles up to 3.5 tonnes and with up to eight passengers. In addition a driver needs a taxi driver licence from the local authority. In England and Wales, outside London, taxis are licensed mostly by district councils under the Town Police Clauses Act 1847 or that Act modified by the Local Government (Miscellaneous Provisions) Act All district councils must license taxis and their drivers. In granting a taxi driver's licence the council is required to satisfy itself that the applicant is a fit and proper person. This expression is not defined in statute and its interpretation is for each council to decide. Councils may make byelaws covering such matters as fares and taxi ranks, but these have to be confirmed by the Secretary of State for Transport. A number of councils throughout England and Wales have adopted conditions of fitness identical to those imposed in London and only allow taxis that meet them to be licensed in their areas. This involves: a criminal record check; a comprehensive topographic examination; a medical; a driving test; and a check on the financial standing of prospective proprietors. There is no statutory requirement for local authorities to carry out a criminal record check before issuing a licence to a taxi driver. As they are, however, required to ensure that the applicant is a fit and proper person, many district councils do, in fact, require a criminal record check. A provision in the Road Traffic Act 1991 gave councils a power to check an applicant's background with the police. Now taxi licensing authorities rely on the Criminal Records Bureau rather than on local police forces to supply criminal record information about applicants. There are two levels of checking designed to safeguard jobs or posts that involve working with children or vulnerable adults. These are designated Standard Disclosure: Standard CRB Check Also referred to as a Standard Disclosure. These are primarily for posts that involve working with children or vulnerable adults. Standard checks may also be issued for people entering certain professions, such as members of the legal and accountancy professions. The Standard check contains details of all convictions held on the PNC including current and 'spent' convictions as well as details of any cautions, reprimands or final warnings. If a position involves working with children, the CRB check will indicate whether information is held on three government lists of those who are banned from working with children or the vulnerable. And Enhanced Disclosure: Enhanced CRB Check 4

5 Also referred to as an Enhanced Disclosure. These are for posts that involve a far greater degree of contact with children or vulnerable adults. In general the type of work will involve regularly caring for, supervising, training or being in sole charge of such people. Examples include a Teacher, Scout or Guide leader. Enhanced checks are also issued for certain statutory purposes such as gaming and lottery licences. This level of check involves an additional level of check to those carried out for the Standard CRB check - a check on local police records. Where local police records contain additional information that may be relevant to the post the applicant is being considered for, the Chief Officer of police may release information for inclusion in an Enhanced check. Exceptionally, and in a very small number of circumstances (typically to protect the integrity of current police investigations), additional information may be sent under separate cover to the Counter-signatory and should not be revealed to the applicant. In addition, many local authorities outside London have decided to insist on the medical requirements of the Group 2 licence for all taxi drivers. It is up to the local councils to decide on the requirements that a driver must meet and it is responsible for determining the standards, including medical requirements, to be applied to taxi drivers in their areas, over and above the driver licensing requirements. They are within their rights to decide that someone with an illness, for example diabetes, is not able to have a licence or should be subject to further tests. Some local authorities have introduced a special taxi/phv driver test. This is a scheme administered by the Driving Standards Agency (DSA). Leeds local authority approached the DSA in 2001 to see if they could arrange a vocational test for their taxi and PHV driver applicants. The DSA then advertised the scheme to other areas and it now administers the scheme nationwide. The test costs between 76 and 123 depending on the type of test and when it is administered. If you fail you can retake the test. Licensing councils also set standards for the vehicles licensed in their areas. Some of the larger councils stipulate that only wheelchair accessible vehicles will be licensed. The majority of taxis outside London remain, however, saloon cars. Section 47 of the 1976 Act allows a district council to attach to the grant of a licence for a hackney carriage any conditions that the district council may consider reasonably necessary (such as number of seats). Any person aggrieved by any conditions attached to the licence may appeal to a Magistrates' Court under section 47(3). 2.2 Private hire vehicles (PHVs) A minicab or private hire vehicle (PHV) is defined by section 80 of the Local Government (Miscellaneous Provisions) Act 1976 as: a motor vehicle constructed or adapted to seat [fewer than nine passengers], other than a hackney carriage or public service vehicle [or a London cab] [or tramcar], which is provided for hire with the services of a driver for the purpose of carrying passengers The definition specifically excludes taxis and buses but does not make any distinction between chauffeur-type services and conventional PHV services. The only exemption from licensing permitted under the 1976 Act is for a vehicle on a hire contract for more than seven days and a vehicle being used for a funeral. PHVs are not permitted to ply for hire in the streets, or at a rank, like a taxi: they can only be hired through an operator, who usually controls their PHVs by means of radios. The owner of a taxi or PHV is usually referred to legally as its 'proprietor'; in practice most minicabs are owner-driven. 5

6 PHV drivers and operators are subject to licensing if a district council has adopted Part II of the 1976 Act or has similar provisions contained in a local Act. About 95 per cent of councils, including all the larger ones, have adopted the provisions. There is no control on the fares that may be charged. As PHVs have to be booked in advance, the customer is expected to agree the fare at the time of booking. PHV drivers need an ordinary driving licence covering category B, which allows them to drive vehicles up to 3.5 tonnes and with up to eight passengers, and must also be a fit and proper person. PHV drivers can be subject to the same criminal record checks as taxi drivers and a few councils insist on the same topographical knowledge tests as those required for taxi drivers. Most licensing authorities also require medical certificates. Again it is for the licensing authorities to decide who is a fit and proper person as it is not defined in legislation. Many years ago the Department of Transport and the Home Office issued guidance to licensing authorities outside London on licensing taxi and PHV drivers with criminal records. 4 This guidance covers such matters as convictions for traffic offences, drunkenness, drug offences, sexual offences, violence and dishonesty. The general principle is that each case must be decided on its own merits, subject to the overriding consideration being the protection of the public. In terms of vehicles, section 48 of the 1976 Act states that before granting a licence for a vehicle to be used as a PHV, the council must be satisfied that the vehicle is: suitable in type, size and design for use as a private hire vehicle; not of such design as to lead any person to believe the vehicle is a hackney carriage; in a suitable mechanical condition; safe; and comfortable. 3 Licensing in London 3.1 Taxis There are two types of London taxi driver licence: green badge holders can ply for trade anywhere in the metropolitan police district; yellow badge holders can operate in one or more of sixteen suburban sectors. There has been little fundamental change in the legislation relating to taxis in London since the present system was established in the first half of the nineteenth century. The London Cab Order 1934 (SI 1934/1346) is the main legislative base for the present licensing regime. Overall responsibility for London taxis now lies with Transport for London (TfL), which took over the function from the Secretary of State for Transport. Delegated authority for day-today licensing operations is carried out by the Public Carriage Office (PCO). The PCO is responsible for ensuring that taxi drivers and proprietors are of the standard specified by the Mayor of London and that their taxis conform to the specification he sets. TfL sets fare levels and approves fees for driver and vehicle licences directly. Taxi fares are set in accordance 4 Department of Transport circular 2/92 and Home Office circular 13/92 6

7 with a formula devised by TfL, following consultation with the taxi trade and others, including London TravelWatch. The PCO has a duty to ensure it grants licences only to people who are fit and proper to drive a taxi. Article 25 of the 1934 Order states: [Transport for London] may in [its] discretion refuse to grant a cab-drivers' licence (a) if the applicant fails to satisfy [Transport for London] that he is of good character and fit to act as a cab-driver The minimum age for drivers is 21 and there is no upper age limit. The fitness standard set by TfL includes a Group 2 standard of medical fitness as well as other requirements such as a criminal records check, financial standing, and the Knowledge of London test. The PCO website explains why it requires a Group 2 standard of medical fitness: Taxi and private hire drivers are professional drivers carrying passengers for hire and reward. The Licensing Authority has determined that for this reason a higher standard of medical fitness is required than that needed for a standard DVLA driving licence. The standards applied, called Group 2 Standards, are those required for drivers of large goods vehicles, buses and coaches. The standards are based upon DVLA Group 2, and are similar to those required for drivers of large goods vehicles, buses and coaches. The same website gives details of the other requirements highlighted above. Taxi owners, including owner-drivers, are subject to similar restrictions. An applicant may invite the Licensing Authority to reconsider a decision to refuse a licence or appeal the decision direct to Horseferry Road Magistrates Court. (A request for reconsideration or appeal must be made within 28 days of the date of the letter notifying the refusal). Vehicles for use as taxis in London have to satisfy the metropolitan conditions of fitness laid down by the assistant commissioner. These prescribe, for instance, a turning circle of 7.62 metres, a partition separating passenger from driver, an overall width of vehicle exclusive of driving mirror of no more than metres, an overall length of no more than metres, and a flat floor in the passenger compartment for which there are minimum height limits. In addition, a taximeter must be fitted. All new taxis are required to be constructed to accommodate a person in a wheelchair in the passenger compartment. No specific age limit is imposed and if a vehicle is in good order, it will be licensed. Licences are valid for one year. Further details are given in the PCO Abstract of Laws. 3.2 Private hire vehicles (PHVs) The London minicab trade used not to be regulated at all. In that respect it was different from the London taxi trade, which is regulated by the PCO and also from the taxi and minicab trades outside London, where regulation by local authorities is almost universal. In 2000 TfL assumed responsibility for PHV licensing from the Secretary of State under section 254 of the Greater London Authority Act The Private Hire Vehicles (London) Act 1998 provided for the licensing of minicabs in London and applies to PHV operators, drivers and vehicles. It was a Private Members Bill introduced by Sir George Young with the support of all three main political parties. It did not specify the 7

8 regulatory system in detail, preferring to leave considerable discretion to the regulatory authority to decide the details. Such an arrangement is in line with the precedents for the regulation both of London taxis, and of taxis and PHVs outside London. The definition of a private hire vehicle is slightly different from that in the 1976 Act: a vehicle constructed or adapted to seat fewer than nine passenger seats which is made available with a driver to the public for hire for the purpose of carrying one or more passengers, other than a licensed taxi or a public service vehicle. The implementation of the 1998 Act was phased, starting with the licensing of the operators. The Government published a consultation paper on the licensing of operators in May 1999 and consulted on draft regulations in August The Private Hire Vehicles (London) (operators' licences) Regulations 2000 (SI 2000/3146) came into force in January 2001; they set out the procedure for applying for licences, the fees payable on application and on grant of a licence and placed certain obligations on operations such as keeping records of hirings. Since 22 October 2001 it has been an offence to operate a PHV without a licence. TfL was responsible for the next two phases of minicab licensing and made the regulations covering drivers and vehicles. The Private Hire Vehicles (London PHV Driver's Licences) Regulations 2003 came into force on 1 April 2003 and, together with section 13 of the 1998 Act, govern the requirements for a drivers licence. Section 13(2) states: (2) The [licensing authority] shall grant a London PHV driver's licence to an applicant if [the authority] is satisfied that (a) the applicant has attained the age of 21, is (and has for at least three years been) authorised to drive a motor car and is a fit and proper person to hold a London PHV driver's licence ( ) Section 3 sets out the medical requirements. More detail on both of these matters can be found on the TfL website. The final phase of implementing the 1998 Act was the licensing of vehicles. The purpose is to ensure that private hire operators offer their customers only vehicles that have been inspected and passed fit for use. The intention is that all licensed vehicles are identifiable by means of a licence plate or disc displayed prominently on the outside of the vehicle. Following consultation in 2001 and April 2003, 6 the Private Hire Vehicles (London PHV Licences) Regulations 2004 were introduced and came into force in March A problem was identified in the definition of private hire vehicle in the Private Hire Vehicles (London) Act The 1998 Act defines a private hire vehicle as "a vehicle constructed or adapted to seat fewer than nine passengers which is made available with a driver to the public for hire for the purpose of carrying passengers, other than a licensed taxi or a public service vehicle". The words "available... to the public" created a problem in that some PHV operators and drivers who provided their services on a contract basis to one or more companies, local authorities, schools, hospitals etc argued that they were not making their services available to the public at large and therefore their vehicles did not fall within the definition of "private hire vehicle" in the 1998 Act. Accordingly, they argued that the whole operation did not require licensing. The Government legislated to close this loophole in 5 6 DETR, Private hire vehicles (London) act 1998: operator licensing, May 1999; and: Private hire vehicles (London) act 1998, August 2000 TfL Follow-up consultation paper on vehicle licensing, April

9 section 53 of the Road Safety Act A Department for Transport letter to local authorities of February 2007 explained the intention in more detail. 7 4 Touting There has long been a significant problem with PHV drivers who illegally used touts (or touted themselves) outside nightclubs, theatres, cinemas and at railway stations. In response to this problem and also to catch taxi touts who operate at airports and railway stations (which are not all public places), taxi touting was made a specific offence under section 167 of the Criminal Justice and Public Order Act Police can therefore prosecute drivers for illegal touting under this legislation. More recently, in London, Mayor of London, Boris Johnson, pledged to tackle illegal touting, 8 and London taxi drivers took to the streets in early 2009 to protest at what they called "illegal" minicab ranks in Leicester Square, denying fares to black cabs. 9 5 Fares Sections 65 and 66 of the Local Government (Miscellaneous Provisions) Act 1976 (as amended) allow the local authority to set fares as follows: Fixing of fares for hackney carriages (1) A district council may fix the rates or fares within the district as well for a time as distance, and all other charges in connection with the hire of a vehicle or with the arrangements for the hire of a vehicle, to be paid in respect of the hire of hackney carriages by means of a table (hereafter in this section referred to as a table of fares ) made or varied in accordance with the provisions of this section. (2) (a) When a district council make or vary a table of fares they shall publish in at least one local newspaper circulating in the district a notice setting out the table of fares or the variation thereof and specifying the period, which shall not be less than fourteen days from the date of the first publication of the notice, within which and the manner in which objections to the table of fares or variation can be made. (b) A copy of the notice referred to in paragraph (a) of this subsection shall for the period of fourteen days from the date of the first publication thereof be deposited at the offices of the council which published the notice, and shall at all reasonable hours be open to public inspection without payment. (3) If no objection to a table of fares or variation is duly made within the period specified in the notice referred to in subsection (2) of this section, or if all objections so made are withdrawn, the table of fares or variations shall come into operation on the date of the expiration of the period specified in the notice or the date of withdrawal of the objection or, if more than one, of the last objection, whichever date is the later. (4) If objection is duly made as aforesaid and is not withdrawn, the district council shall set a further date, not later than two months after the first specified date, on which the table of fares shall come into force with or without modifications as decided by them after consideration of the objections DfT, Changes to Taxi and Private Hire Vehicle Legislation in the Road Safety Act 2006, 28 February 2007, paras 10-13; legislated for in the Private Hire Vehicles (London) (Transitional Provisions) (Amendment) Regulations 2007 (SI 2007/3453) which came into force on 31 December Mayor of London press notice, Mayor planning to tackle taxi touts, 13 June 2008 Black cabs blockade over minicabs, BBC News Online, 5 February

10 (5) A table of fares made or varied under this section shall have effect for the purposes of the Act of 1847 as if it were included in hackney carriage byelaws made thereunder. (6) On the coming into operation of a table of fares made by a council under this section for the district, any hackney carriage byelaws fixing the rates and fares or any table of fares previously made under this section for the district, as the case may be, shall cease to have effect. (7) Section 236(8) (except the words when confirmed ) and section 238 of the Local Government Act 1972 (except paragraphs (c) and (d) of that section) shall extend and apply to a table of fares made or varied under this section as they apply to byelaws made by a district council. Fares for long journeys (1) No person, being the driver of a hackney carriage licensed by a district council, and undertaking for any hirer a journey ending outside the district and in respect of which no fare and no rate of fare was agreed before the hiring was effected, shall require for such journey a fare greater than that indicated on the taximeter with which the hackney carriage is equipped or, if it is not equipped with a taximeter, greater than that which, if the current byelaws fixing rates or fares and in force in the district in pursuance of section 68 of the Act of 1847 or, as the case may be, the current table of fares in force within the district in pursuance of section 65 of this Act had applied to the journey, would have been authorised for the journey by the byelaws or table. (2) If any person knowingly contravenes the provisions of this section, he shall be guilty of an offence. 6 Scotland Scotland has always had its own legislation covering taxis. The Civic Government (Scotland) Act 1982 lays down the main provisions for the licensing of taxis and hire cars in Scotland. Section 10 requires all vehicles to be licensed by the licensing authority (the local authority) and section 13 requires all drivers also to be licensed by the local authority. The legislation was amended by the Disability Discrimination Act 1995 and section 20 provides the power to introduce the taxi accessibility regulations required by the Act. Licensing issues are therefore a matter for the Scottish Parliament although matters relating to transport for disabled people continue to be a Westminster responsibility. 10