Private hire car overprovision: independent assessment tool for local authorities

This independent report has been produced to support licensing authorities who wish to undertake an assessment of whether there is an overprovision of private hire cars in their area.

1 Introduction

1.1 Introduction

The Air Weapons and Licensing (Scotland) Act 2015 (the 2015 Act) introduced a number of amendments to the regime, namely -

  • Allowing for testing of private hire car drivers;
  • Requiring local authorities to appoint a civic licensing standards officer;
  • And allowing local authorities to limit the number of private hire cars.

This report relates to the power to limit the number of private hire cars and potential methods of assessing whether such a limit would be appropriate.

The aim of local authority licensing of the PHC (private hire car) trade is to protect the public and to help ensure that the public have reasonable access to taxi and PHC services, given the part they play in local transport provision.

Private hire services are provided by two types of vehicle:-

  • Taxis or black cabs which can be hailed in the street, operate from taxi ranks or be pre -booked and generally have a meter and;
  • Private Hire Cars (PHC) which cannot be hailed, cannot use a taxi rank, must be pre-booked and may or may not have a meter.

At present the number of Taxis can be capped. The present legal provision on quantity restrictions for taxis is set out in section 10(3) of the 1982 Act. This provides that "the grant of a taxi licence may be refused by a licensing authority for the purpose of limiting the number of taxis in respect of which licences are granted by them if, but only if, they are satisfied that there is no significant demand for the services of taxis in their area which is unmet".

The 2015 Act introduced a similar power to allow licensing authorities to restrict the number of Private Hire Cars (PHC) if it were determined that there was an overprovision of PHC. The newly added subsections of Section 10 of the Civic Government (Scotland) Act 1982 are as follows:-

"(3A) Without prejudice to paragraph 5 of Schedule 1, the grant of a private hire car licence may be refused by a licensing authority if, but only if, they are satisfied that there is(or, as a result of granting the licence, would be) overprovision of private hire car services in the locality(or localities) in their area in which the private hire car is to operate.

(3B) It is for the licensing authority to determine the localities within their area for the purposes of subsection (3A) and in doing so the authority may determine that the whole of their area is a locality.

(3C) In satisfying themselves as to whether there is or would be overprovision for the purposes of subsection (3A) in any locality, the licensing authority must have regard to :-

a) the number of private hire cars operating in the locality, and

b) the demand for private hire car services in the locality."

Unlike taxis at taxi ranks, it is not normally feasible to directly observe private hire activity. Therefore, alternative methods of determining levels of demand and use, are required.

There is no simple numerical formula for pinpointing the threshold between provision and overprovision. Determining overprovision involves the application of reason and judgement in the interests of the community. Therefore, one of the key considerations when considering applying a cap to private hire car licenses, would be how such a limit would benefit the public.

The matter should be approached in terms of the interests of PHC users. When assessing overprovision, due regard must be given to the number of private hire cars operating in the locality and the demand for PHC in the locality. This should be informed by the need to ensure that customers can continue to be provided with a safe and reliable service. This may take account of the provision of accessible vehicles, availability across the week, and at key times.

1.2 Definitions

Private Hire Car Overprovision

Overprovision can mean different things to different people. It is first important to define our specific view about what constitutes Private Hire Car Overprovision. Our definition is when there are sufficient private hire cars available to meet demand at all but brief periods at peak demand times and to introduce additional private hire cars would result in a dis-benefit to the public.

Private Hires

Private hire cars may only be hired through pre-booking. Taxis may also be hired through pre-booking. For the purposes of this document, we consider private hires to be hires of licensed vehicles which are pre-booked, whether they are undertaken by private hire cars or by taxis. Pre-booked hires may be for immediate travel or for some time in the future.

Private hire cars also undertake pre-booked hires over longer periods, such as daily hire or multiple day hire for chauffeur type services. Such services can also be provided by taxis, but this is relatively unusual.

Both taxis and private hire cars might also fulfil contracted bookings for education or social services transport which might also increase vehicle numbers and give an appearance of overprovision so this element needs to be clarified.

1.3 Localities

Throughout Scotland, the characteristics of each licensing authority area can vary significantly. Within each authority area, characteristics can vary between localities. One of the most readily apparent differences relate to urban versus rural characteristics. A private hire overprovision assessment may be applied as a measure across the whole of a licensing area, or within specific localities. This offers the flexibility to consider individual localities on their own merits.

1.4 Basis of this report

The advice and opinions provided in this report are based on the experience of the authors and feedback from representatives of licensing authorities and representatives of the trade. The authors have undertaken over two hundred independent licensed vehicle studies throughout the UK, together with providing direct advice and assistance to licensing authorities.



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