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 18 March 2004
The Government today responded to
the Office of Fair trading (OFT) report on the
regulation of licensed taxi and PHV services in
the UK. The Government accepts OFT’s
recommendations on quality and safety regulations
and maximum fares, and agrees with OFT that
consumers should enjoy the benefits of
competition in the taxi market.
However, the Government feels that
local authorities remain best placed to determine
local transport needs and to make the decisions
about them in the light of local circumstances.
Therefore, rather than impose a legislative
solution at this stage, the statement sets out a
number of steps to encourage Local Authorities to
remove restrictions unless they can show that they
deliver benefits to consumers. Where they feel
restrictions should be retained, they should
publish and justify their reasons. This is in
keeping with the development of Local Transport
Plans, where decisions on transport needs are
made locally and in line with wider government
policy towards Local Authorities.
  Government announcement
(5 pages) Press Notice.
Background
The Office of Fair Trading (OFT)
released on Tuesday 11 November 2003 to the
Secretaries of State for Trade and Industry and
Transport and Scottish Executive Ministers a
report into the UK market for taxis and private
hire vehicles and whether consumers are best
served by the current regulatory regime under
which they are licensed.
The report made the following
recommendations:
- that the
legislative provisions allowing licensing
authorities to impose quantity controls
in England (outside London), Wales and
Scotland should be repealed. In the
meantime, OFT recommends that Local
Authorities with quantity controls remove
them;
- that the
Department for Transport promote and
disseminate local best practice in
applying quality and safety regulations
involving the Scottish Executive and the
Department of the Environment (Northern
Ireland) in this process. The purpose of
this would be to assist Local Authorities
to apply standard quality and safety
attributes in a proportionate manner.
Department for Transport should publish
best practice guidance on quality
controls;
- that throughout
the UK Local Authorities should only set
fare tariffs which represent the maximum
that can be charged, and not set fixed or
minimum fares. It should be made clear to
consumers that they are able to negotiate
on fares, for example, when ordering a
taxi over the telephone. OFT also
recommends that, where possible, LAs
actively facilitate more price
competition in the market, particularly
in the rank and hail sectors of the
market.
The Department of Trade and Industry (DTI) has a general
interest in OFT's market studies and co-ordinates
Government responses where those studies make
regulatory recommendations.
Responsibility
for legislation on taxis and private hire
vehicles in England and Wales falls to the
Department for Transport. In Scotland it is
devolved to Scottish ministers and falls within
the responsibility of the Minister for Finances
& Public Services. Responsibility for
taxi regulation in Northern Ireland is also
devolved. DTI worked closely with the
relevant Government departments to make sure that
the government's response to the report took
account not only of competition and consumer
interests but wider public policy objectives.
Market Study on Taxis (link to OFT
site)Joint Press Notice
Market
Study information page
 Contacts
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