DEVOLUTION WHITE PAPER: Will it solve ‘cross-border’ working in the taxi industry?
The English Devolution White Paper, published in late 2024, proposes reforms to transfer significant powers to regional mayors under an Enhanced Devolution Framework. While its primary focus is on planning, transport, and economic development, it also touches on a long-standing issue in the taxi and private hire sector: cross-border working. The question is whether these reforms will provide a meaningful solution to a problem that has frustrated local councils and operators for years.
The Cross-Border Working Challenge
Cross-border working occurs when private hire vehicles (PHVs) or taxis are licensed in one area but operate predominantly in another. This practice has grown with the rise of app-based operators like Uber, which exploit inconsistencies between local licensing authorities. Vehicles often seek licences in areas with less stringent conditions or lower fees, only to work full-time in neighbouring regions.
The result is a two fold problem. First, local councils lose regulatory control over vehicles operating in their jurisdictions, which complicates enforcement. Second, local operators face unfair competition from drivers who circumvent stricter standards or higher costs imposed by their own licensing authorities.
What the Devolution White Paper Proposes
The White Paper proposes to address cross-border working by placing licensing responsibilities in the hands of larger regional authorities, such as Local Transport Authorities (LTAs). According to the document, this would:
Expand Licensing Boundaries: Licensing would cover larger “functional economic areas”, replacing the current patchwork of district councils.
Increase Consistency: A unified licensing regime across a region would ensure common standards for vehicle safety, emissions, driver qualifications, and fees.
Strengthen Enforcement: Larger authorities with greater resources could more effectively enforce licensing conditions across their expanded territories.
The Government argues that this approach will eliminate the incentives for drivers to “shop around” for licences in areas with lower standards and fees, as these differences would no longer exist within a unified region.
What are the Potential Benefits?
If implemented effectively, the devolution reforms could offer several advantages:
1. Streamlined Standards: Uniform regulations across regions would reduce the disparities that currently drive cross-border licensing. For example Greater Manchester’s attempt to create minimum standards shows the potential for such initiatives to harmonise requirements like vehicle age limits, CCTV installation, and emissions compliance.
2. Enhanced Enforcement: With larger budgets and dedicated teams, regional authorities could invest in more robust enforcement measures, including better use of technology to monitor vehicle operations and compliance.
3. Improved Public Safety: Consistency in driver and vehicle standards could lead to higher service quality and safety for passengers. This is particularly important for vulnerable groups who rely on taxis and PHVs.
4. Fairer Competition: Local operators could compete on a level playing field, as drivers would no longer benefit from licensing under looser regulations elsewhere.
Concerns and Challenges
Despite its potential, the devolution plan is not without its critics. Key concerns include:
1. Critics argue that larger regions might not address the specific needs of rural or urban areas. For example, a standardised approach might not account for the unique transport challenges in sparsely populated areas.
2. Increased Complexity: Merging licensing authorities could lead to transitional confusion, as seen in Northamptonshire’s tariff unification efforts. Drivers and operators might face delays and inconsistencies during the transition period.
3. Expansion of Cross-Border Working: Rather than curbing cross-border working, expanding licensing zones could inadvertently legitimise it. For instance, drivers operating under a regional authority might now have a larger area in which to work without addressing the localised congestion or over-saturation issues this practice creates.
4. Undermining Local Control: The shift from district to regional licensing could erode local councils’ ability to tailor regulations to their communities’ needs. Critics cite the example of Greater Manchester, where not all councils agreed to adopt unified standards, highlighting potential conflicts in decision-making at the regional level.
An Alternative Approach: Intended Use Policies
Some industry stakeholders argue that a simpler solution could involve rolling out “intended use” policies more broadly. These policies, currently used for hackney carriage drivers, require that most of a driver’s work take place in the area where they are licensed. Applying this to private hire drivers and operators could address cross-border working without the upheaval of transferring licensing powers to regional authorities.
The Devolution White Paper presents an opportunity to tackle cross-border working through regional licensing reform. While the proposal has merits, its success will depend on careful planning, consultation, and implementation. Without addressing operational complexities and localised impacts, the reforms risk exacerbating existing problems or creating new ones.
