paramount. Local authorities must include taxis and PHVs in local trans- port plans, using such plans to justify their approaches to licensing and enforcement.


33. We welcome the Minister’s commitment to reform taxi and PHV leg- islation, which he has recently described as “a mess”. However, we are not satisfied that passing the issue to the Law Commission to study is appropriate or necessary. New policy thinking is required from the Gov- ernment, now not in two years’ time. We call on the Government to set out its policy proposals before the end of the year, with a view to holding a consultation exercise in 2012, introduc- ing draft legislation in 2013-14 and taking an Act or legislative reform order through Parliament before the next general election.


Conclusions and recommendations Introduction


1. In our view, the case for a thorough overhaul of the legislation relating to taxis and private hire vehicles is irresistible. (Paragraph 14)


2. We recommend that, instead of referring reform of taxi and PHV legis- lation 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. (Paragraph 15)


Principles to underpin new legislation


3. We recommend that, in developing proposals for changing the legisla- tion applying to taxis and PHVs, the Government should commission authoritative research into consumers’ opinions. Particular attention should be paid to the views of vulnerable groups, such as disabled peo- ple, who are often most reliant on taxis and PHVs. (Paragraph 18)


4. We recommend that the Town Police Clauses Act 1847 and the Local Government (Miscellaneous Provisions) Act 1976 should be replaced by a single Act or legislative reform order, covering both taxis and PHVs. (Para- graph 19)


5. We recommend that the Government provide clearer guidance to local authorities on how taxis and PHVs should be included in local transport plans. (Paragraph 21)


6. There are strong arguments in favour of national standards in relation to issues which directly relate to public safety, such as the level of CRB


check drivers require, the roadworthiness of vehicles and drivers whose licences have been revoked being licensed shortly afterwards by a differ- ent district. We recommend that new legislation in this area should provide for this. (Paragraph 23)


7. We agree with the Minister that the licensing of taxis and PHVs should remain a local function, not least because of the likely cost and complex- ity of instituting a national system. (Paragraph 23)


8. We recommend that any legal barriers to co-operation between local authorities and innovation in organising and funding enforcement activity in relation to taxis and PHVs should be reviewed as part of the process of legislative reform. (Paragraph 25)


9. We are sympathetic to the argument that offences relating to taxis and PHVs, such as plying for hire, should be dealt with by fixed penalty notices rather than court action and we recommend that the Government should move in this direction when it comes to reform the legislation in this area. (Paragraph 26)


10. We recommend that new legislation should permit existing licensing districts to be combined where local authorities decide it is best to do so. (Paragraph 28)


Solving the cross-border hire problems


11. We recommend that it should be permissible for taxi and PHV licences to include a condition that the vehicle must principally be operated in the licensing district. A similar provision should also be permitted in relation to driver licences. (Paragraph 30)


12. In addition, new legislation should permit local authorities to issue fixed penalty notices to out-of-town drivers where there is evidence, for example, that they have worked, or sought to work, for a specified period of time in that district. Local authorities should also be enabled to prose- cute operators in other districts which are routinely sending cars to work in their area. (Paragraph 30)


13. In our view it is essential that local authorities justify their approach to the use of these controls in local transport plans, alert drivers and opera- tors in neighbouring districts to their intention to use such powers; and provide adequate warnings to drivers and operators before issuing fixed penalty notices or initiating prosecutions. (Paragraph 31)


Conclusion


14. We call on the Government to set out its policy proposals before the end of the year, with a view to holding a consultation exercise in 2012, introducing draft legislation in 2013-14 and taking an Act or legislative reform order through Parliament before the next general election. (Para- graph 33)


THE LAW COMMISSION – TAXIS AND PRIVATE HIRE VEHICLES – REGULATION


2.72. Taxi-cabs (“hackney carriages”) are a highly regulated market, and have been since Victorian times (or earlier – some controls were first imposed under the Stuarts). Private hire vehicles have been regulated since the 1970s. There are distinct legal systems for London, Plymouth and the rest of England and Wales; and different systems for taxi- cabs and private hire vehicles. Outside London, local authorities are the licensing authorities for both taxi-cabs and private hire vehicles. In London, licensing is now the responsibility of Transport for London. Licensing authorities regulate the quantity of taxi-cabs and the fares they can charge, and, for both taxi-cabs and private hire vehicles, the quality of services, including the safety of vehicles and the fitness of drivers. Drivers and vehicles must be licensed, and, in respect of private hire vehicles, there must also be a licensed operator.


2.73. The first level of reform would be to reduce the sheer bulk, complexity and incon-


AUGUST 2011 PHTM


sistency of the regulatory systems. Central concepts like “plying for hire” have caused considerable problems in the past. There are pointless geographical inconsistencies on such matters as whether a taxi-cab driver needs a separate private hire licence, and whether the vehicle can be used for leisure purposes by its owner/driver. Secondly, there is a need to modernise to reflect technological change – private hire licensing, for instance, is posited on a geographically fixed operator with premises where bookings are made. Finally, the fundamental features of the regulatory sys- tem are in need of reconsideration – the separate systems for taxi-cabs and private hire vehicles, the identity of the licensing authori- ties, the number and nature of licences and whether all forms of regulation are still neces- sary.


2.74. This project engages economic and reg- ulatory theory. It will be fundamentally deregulatory, in the sense that it will seek to question the necessity for the various strands


of the current regulatory regime, and seek to reformulate those that are necessary in the light of modern understandings of the most efficient and efficacious forms of regulation.


2.75. The taxi and private hire vehicle market had an annual turnover of above £2.2 billion in 2003. It is likely that a modernised and simpli- fied system of licensing will reduce the costs of the licensing system to both local authorities and market participants themselves. However, the realisation of these potential savings would depend on decisions to be taken on the key regulation reform issues which will constitute the substance of the project.


2.76. We expect the project to take three years, with a consultation period in the second half of 2012.


2.77. The project will require close working with the Welsh Government, which is responsi- ble for local government generally and for transport facilities.


PAGE 77


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