Changes needed in the taxi and private car hire market

The passenger must remain at the centre of the debate on the future of the private hire industry. In my Lords’ debate this week I raised the issues the industry now faces. The future of the taxi and private hire industry is dominated by the IT revolution. Having a smart phone in your pocket has completely changed how use public transport making it easier, more flexible and more convenient for passengers.

Despite these rapid changes (or perhaps because of them) the laws relating to taxis and private hire are very outdated. Pre-booking a private hire car used to be a slow process yet recent development of apps, by such companies as Addison Lee and Uber, now mean that a car appears quickly and a fixed fare is quoted, regardless of any congestion that may be encountered. Payment is made with a mobile, often automatically, with no money directly changing hands.

However, the Black Cab trade, which is an iconic symbol of London, with all its regulations, checks, and rules, is suffering. The number of private hire cars applying to operate in London is rising steeply. There is a danger in the present condition there might be a “race to the bottom” with the Black Cab and those allied to the more ‘formal’ end of the private hire market being driven (excuse the pun) from the business. It is a situation faced by other businesses; the book trade has seen Amazon driving many small book shops out of business, and iTunes has created similar changes in the music industry.

Black Cabs are expensive to buy, have to meet tight, and possibly outdated, specifications including such things as a light turning circle and full wheelchair accessibility and drivers must pass a stringent knowledge test which takes a long time to acquire. The cabs must be clean and mechanically in good condition. Black Cab drivers have to pass a criminal records check and must be able to speak English. In return for this Black Taxis have the right to ply for hire and respond to hailing in the street.

Uber, who face much less stringent regulation, are expanding to several cities outside London. The same pressures faced in our capital will become evident elsewhere both on licensed taxis and private hire vehicles.

There is a long list of issues which must still be clarified. These include insurance, the degree of English spoken so that driver and passenger can understand one another, vehicle maintenance, what provision is made for the disabled, whether the vehicle pays the congestion charge, and the vexed question of enforcement. And, no less importantly, the tax paid by operators and drivers has also to be calculated.

There is no doubt the Black Cab trade needs to review its practices and bring them up to date to put them in a position where they can compete. It is equally clear that the private hire market, including Uber, need to listen to the issues being raised. Improvements to how the industry is regulated will lead to a better protection, service and care for passengers and ultimately, no matter the influence of technology, it is the customer who comes first.