TfL’s ‘financial position’ means no fresh taxi delicensing funding likely, confirms Mayor of London
Taxi drivers hoping for fresh financial support to switch to cleaner vehicles will be disappointed, as Transport for London (TfL) has confirmed there is no funding available for new grants or delicensing schemes.
Mayor of London Sadiq Khan has stated that TfL’s financial constraints prevent further investment in support packages. This comes as the Government cuts the Plug-in Taxi Grant (PiTG) from £6,000 to £4,000 per vehicle from April 2025.
London Assembly Member Elly Baker recently questioned the Mayor on potential new funding to help drivers replace older diesel cabs with zero-emission capable (ZEC) taxis. Baker asked: “What plans, if any, do you have to introduce a new Taxi Delicensing Scheme or other package of targeted financial support to help drivers whose older diesel vehicles are due to hit their age limit afford a new ZEC taxi and keep them driving cabs?”
In response, Khan highlighted that over £50 million has already been allocated to various initiatives, including a £42 million delicensing fund that offered up to £10,000 per vehicle.
The Department for Transport recently announced that the PiTG will remain in place for another year, but at a reduced rate. This latest cut follows a reduction earlier in 2024, when the grant fell from £7,500 to £6,000. The new £4,000 rate will apply from 6 April 2025 to 5 April 2026.
With no further delicensing support on the horizon, taxi drivers looking to upgrade their vehicles will have to navigate the transition with limited government support and growing costs.
Sir Sadiq Khan, Mayor of London, responded: “Transport for London (TfL) and I have provided more than £50m of funding across a range of initiatives to encourage taxi vehicle owners to retire older, more polluting vehicles and encourage the uptake of clearer, greener vehicles.
“This included a £42m delicensing fund (offering payments of up to £10,000) for taxi-dedicated rapid charge points and contributions to the Government’s Plug-in Taxi Grant (PiTG).
“This, alongside policy interventions to improve London’s air quality, has resulted in over 60 per cent of the taxi fleet now being zero-emission capable – something we are all proud of. The taxi trade has demonstrated that alongside a celebrated history, it embraces the future and leads the way in new technologies.
“TfL’s well-documented financial position means there is currently no funding available to provide further financial support in the way you suggest. TfL continues to raise the importance of extending the PiTG beyond March 2025 with Government, as well as making the case for VAT relief on taxis, as purpose-built wheelchair accessible vehicles, and on VAT relief for on-street charging.”
