Agenda item

The Committee received a report on Hackney Carriage Fares. Where tariffs were set by the local authority, drivers of hackney carriage vehicles (taxis) cannot charge more than the fare specified on the meter apart from in certain exceptional circumstances, although they could charge less. Section 65 of the Local Government (Miscellaneous Provisions) Act 1976 set out the process and requirements for the fixing of fares, which included the requirement for advertising and a statutory 14 day consultation period. The new Buckinghamshire Council Taxi and Private Hire Licensing Policy came into force on the 6th September 2021 and the Policy removed the previous legacy area hackney carriage zones thereby leaving one single operating zone. As a result, a new single set of hackney carriage tariffs was also implemented on the 6th September 2021 for all drivers of hackney carriage vehicles in Buckinghamshire.

Given that the new tariffs were implemented relatively recently, it was intended that the next review would take place in April 2023. However, given the significant recent increases in fuel prices, along with requests from the hackney carriage trade, it was considered appropriate and necessary to carry out a review now to ensure that drivers were able to earn a fair wage whilst also balancing the cost of any increase to passengers. This was an issue which was affecting authorities across the country with many local and national licensing authorities currently in the process of reviewing and increasing their hackney carriage tariffs as a result of recent trends in fuel prices.

In order to obtain the views of the hackney carriage trade as a whole and to clarify whether there was a consensus on the issue across the trade generally and also in different Council areas, officers carried out a short pre-engagement survey in May 2022 which asked specific questions on whether or not each of the tariffs should be increased and the reasons for the answers provided. 57 responses were received which reflected a broadly similar response rate across the previous legacy areas with 7 responses received from the Aylesbury area, 16 from the Chiltern area, 15 from South Bucks and 11 from the Wycombe area. It was not possible to confirm in which area the remainder had previously been licensed.

The majority (96%) of those responding were in favour of an increase to Tariff 1 and only 3 of the responses were against this proposal. The responses in relation to Tariff 2 were less conclusive with only 49% in favour of an increase. Similarly, only 45% of the responses were in favour of an increase to the current Tariff 3.  The reasons given for the need to increase tariffs were mainly due to the increased cost of fuel but increased maintenance costs and the rises in the cost of living generally were also mentioned.

Work was currently being carried out with the meter companies to establish the best means of increasing Tariff 1 in a manner which was fair to both drivers and passengers. The Principal Licensing Officer reported that they had met with the trade and also the meter companies (who had a good knowledge of benchmarking nationally). Reference was made to the CPI annual rate of inflation at 9% but also to rising fuel costs over the last 12 months which have gone up 40%. There was a proposal to increase the Tariff 1 flag rate (charge for minimum fare) from £3 to £3.50 and to reduce the distance for the flag from 700 yards to 124 yards. In practical terms for a 2 mile journey, the recognised distance used for comparison purposes, on tariff 1 it is currently £5.94 that would rise to £7.04 (18.5%). In terms of the other 300 plus local authorities, 75 Councils have reviewed their fares this year, with 29 of those Councils proposing higher fares. This proposed increase was in line with what other local Councils were doing; Wokingham £8.20, Basingstoke £7.60 and Slough and Stevenage £7.00. 

Once finalised, the proposed new tariffs would be advertised locally, as required by the relevant legislation, and also via the Council’s website. A key decision report would be submitted to the Cabinet Member which would include the views of this committee. If approved there would be a statutory 14-day consultation period, and if there were no objections then the decision could be implemented. A decision on this issue was currently scheduled on the forward plan to be made on or after the 13th July 2022. The amended tariffs would be implemented as soon as possible following the decision, depending upon the availability of the meter companies to reprogramme taximeters. If objections were received, then the decision would be returned to the Cabinet Member and Leader for consideration.

During discussion the following points were made:-

·       It would be helpful to have some clarity on the size of the business as this could have a significant impact on the local economy. The Principal Licensing Officer reported that the vast majority were private hire vehicles and the Council had no control over the rates that were charged. There were in the region of 300 hackney carriage vehicles which the Council licenced where the Council did have control; these were the taxis that sat on the ranks with a taxi sign on the roof. They were often single operators and owned and operated by the individual who held the licence. The numbers would be included in the key decision report for reference.

·       Clarity was sought on when the consultation was undertaken as the fuel prices had increased since May and also what apportionment of the fee related to fuel. Reference was also made to hybrid/electric cars and whether that was accounted for in the figures. The Member also made a comment on what happened to the fee when fuel prices came down. The Principal Licensing Officer commented that he did not have the figures on apportionment when the fees were originally set. However, what was used across the country as a comparison was a  2 mile journey, so for tariff 1 currently the 2 mile journey would cost £5.94 with the proposal it would increase to £7.04. The Head of Service reported that the survey in May (undertaken from 9-15 May 2022) was asking the trade whether the fee should increase rather than by how much. There was wide spread support for an increase in the fee. However, the work on pricing had been undertaken much more recently so reflected current fuel prices. The number of electric vehicles were low and clarity on numbers would be included in the key decision report; electric vehicles were incentivised by being licenced for a longer period of 15 years. They would consider the right approach for electric vehicles. Another reason that the trade had asked for an increase was due to the cost of living crisis, so not completely fuel related. The tariffs would be reviewed if fuel and other prices reduced significantly. The Member commented that it would be helpful to have the fee broken down to show the percentage between fuel and cost of living and maintenance costs etc. Therefore if the market changed it would be clear how the fee should be adjusted. This was agreed.

·       A Member queried how the 18.5% increase had been determined. The Principal Licensing Officer reported that it had been proposed at a meeting they had with the trade but with reference to benchmarking figures from other local authorities reviewing their fees. The Member expressed concern that this increase should be considered carefully as other public sector areas were only receiving 2-3% increases in their pay. The Principal Licensing Officer reported that the fee that the Council set was a maximum charge but what was actually charged by vehicle proprietors across Buckinghamshire was very mixed when the fares were introduced last September.  Some proprietors thought that the fees that were set with the new Policy and came into effect in September 2021 had been set too high and had been charging lower fees. There was now a consensus from the trade to increase fares in line with the proposed new tariffs.  The taxi trade would also be concerned that they do not price themselves out of the market with their competitors from the private trade. Another Member commented that the price for electric chargers had increased by 40% or more in the last few months. In London new cabs were electric and it was important to encourage electric cars especially as they were expensive to purchase in the first place. It was agreed that it would be useful to find out the average price that Hackney carriages were charging passengers across Buckinghamshire if possible.

·       In terms of private hire vehicles, a question was asked whether their prices had increased and Members were informed that they had risen significantly although they did not have this information as their fees were not regulated by the Council.

·       The Committee agreed that a report should be brought back to the Licensing Committee to review fees if fuel and other prices dropped significantly. The Cabinet Member would take into account the views of the Committee in terms of the key decision, and that the report referred to a 9% increase.

RESOLVED that the comments made by the Licensing Committee be taken into account, in advance of a Cabinet Member key decision on the proposal to increase Hackney Carriage fares (tariffs) for the Buckinghamshire Council area in light of significant increases in fuel prices and further to requests from the licensed hackney carriage trade.