An exposition of the current regulatory travails of Britain’s Community Transport sector, with an exploration of the legal possibilities for operating Dial & Ride style community services using vehicles with capacity of no more than eight. This essay provides insight into why there is so little taxi policy locally, and why the British have such a problem with sharing.
Trials and Tribulations
The Transport Act 1985 is the main legislation governing road passenger transport in Great Britain by vehicles with a capacity of more than 8 passengers – buses. Public passenger operations for fewer passengers are separate: In England outside of London, taxis – as Hackney Carriages able to “ply for hire” – are legislated for by the Town Police Clauses Act 1847. Pre-booked Private Hire principally under part 2 of the Local Government (Miscellaneous Provisions) Act 1976. The legal landscape for such vehicles is broadly similar in the remainder of Great Britain, but the precise legislation may differ.
The political gulf between the 1976 and 1986 Acts could scarcely be greater – 1970s Socialist municipalism and 1980s deregulated Thatcherism. The 1847 Act still differentiates taxis from stagecoaches. And yet all three Acts can be found on the same street, serving the same people.
Community Transport – as the use of buses by social welfare groups, or grass-roots community services not provided by the traditional bus network – was small-fry in early 1980s, and thus handled by exemptions to the Transport Act 1985: Sections 19 and 22 respectively. These allowed such operation of buses without the administrative burden of a Passenger Service Vehicle (PSV) regime intended for mainstream bus operation.
However, provisions designed for a voluntary sector were soon being reinterpreted more liberally, such as in the implicit acceptance of salaried staff to drive Section 19/22 vehicles. By the 2000s, the scale and professionalism of the largest Community Transport operations increasingly resembled that of PSV operators, merely without the profit motive. For example, at the time of its collapse, one of the largest, West Midlands’ Accessible Transport Group, employed over 700 people to operate more than 500 vehicles, almost all under Section 19/22. In recent years, Community Transport operators have increasingly competed for public contracts, in direct competition with commercial PSV operators: Quite reasonably considered unfair competition, given Community Transport’s reliance on legal exemptions which reduce their costs.
Accusations of unfair competition festered for more than a decade. Ignored by a Department of Transport keen to promote, not inhibit, flexible Demand Responsive Transport. Nor pressed by austerity-driven local government, drawn by Community Transport’s appealing mix of cheap, civic and social. Until 2015, when the Department for Transport was challenged by Martin Allen’s complaint to the European Commission and consequential notice of infraction of EC 1071/2009.
European Union regulation EC 1071/2009 had sought to reinforce prior road transport policy, but while it came with its own derogations, these differed from those in the Transport Act 1985. Notably, EC 1071/2009 allowed an exception for “exclusively non-commercial” operations, which are not necessarily the same as “not-for-profit”, particularly where a charity cross-subsidises one operation with income generated by an otherwise commercial contract.
December 2017’s Parliamentary Committee report described the consequent confusion in some detail, as the Department of Transport revealed its “lack of understanding of the [Community Transport] sector” while struggling with the implications of whatever non-commercial might mean. Consultation on Sections 19 and 22 followed, and the Transport Act 1985 was subsequently ammended to reflect the wording of EC 1071/2009, ammendments due to become live in October 2019. However the interpretation of exceptions remains largely in guidance.
The interpretation of “exclusively non-commercial” given by the Department for Transport’s guidance is already subject to the High Court judicial review, with a decision expected in 2020, dangerously sometime after the wording becomes law. The parallel “short distance” exemption – which has been interpreted to allow “not-for-profit” operation in a 10 mile radius or for passenger journeys no longer than 10 miles – is also vulnerable, since it blatantly conflicts with the vast majority of local bus markets. Even the “main occupation” exemption is flaky and divisive and entirely likely to end in tears, since it has the consequence of allowing otherwise non-exempt Section 19/22 services to be delivered only by larger non-transport-specialist charities.
Judicial review judges lawfulness – the procedure and process behind decisions. Judicial review is not a political system, and cannot nuance or balance conflicting policy needs. Reliance on the courts, both here and in neighbouring policy areas such as railways, is surely indicative of national policy failure.
Critically, once national government can’t be relied on for decision-making, the lower tiers of the centralised British system are exposed to what they have little capability to manage alone. Decisions are already defaulting to regional Traffic Commissioners, local government contracting departments, and even the police. The resulting uncertainty creates risk that the Community Transport sector lacks the financial resilience to manage – especially small, charitable operators of commercially marginal contracted services.
In recent years even national transport policy documents have become infected by a lingering sense of doubt: The wild optimism of the past is now usurped by a need to manage unknowable (unpredictable) risk for fear of being overwhelmed by complexity. The underlying flaw is structural – that traditional analytic governance is increasingly overwhelmed by the rapidly inflating behemoth of every-which-way mobility – but such a structural flaw is not something national government can easily acknowledge without undermining its natural authority. Embracing the multiplicity of mobility thus paradoxically implies defining it ever more precisely.
The current Community Transport legislative impasse is entirely likely to perpetuate, in one form or another, because the Transport Act 1985 remains at odds with contemporary competition policy – policy which has become even more dominant over the subsequent decades: Tolerance for non-binary legislation – “grey areas” of law for marginal cases (such as Section 19/22) – has waned, with a preference for clearly defined and fairly contested markets. Meanwhile state aid rules have shifted grant-funding to competitive tender, creating markets for Social Goods – albeit monetary markets which are agnostic to social community itself – a trend only partly moderated by the Public Services (Social Value) Act 2012.
In seeking to promote fair competition, the eventual outcome of the Section 19/22 dispute must surely be licensing parity with fully commercial operators. That points to PSV Operator licensing, which is well established and now compliant with EC 1071/2009. As much as the Department for Transport may wish to legislate on buses and taxis – perhaps even smooth the increasingly irrelevant (vehicle capacity) differentiation between the two – it is hard to see how, given the Brexit-related stasis of the Westminster Parliament. While some form of policy localism could ultimately provide an alternative, non-European, counter-balance to national totalitarianism – where the lack of such an alternative counter-balance to Europe currently inhibits departure from Europe (save England, at least, become its own absolute totality) – such a revolution cannot reasonably be managed by the national government it counters.
A full Passenger Service Vehicle regime won’t just raise cost for Community Transport operators and funders, ultimately threatening marginal operations. It will also break civic ties, instead matching charity against commerce. Social Enterprise is one response to that matchup, but it remains unclear whether a local operator can attain the economies of scale and finance to compete in a market which, until very recently, had been drifting toward multinationals. For smaller Community Transport operations, which cannot afford or manage PSV Operator licensing, retrenchment to purely voluntary activities, such as community car schemes, seems the most likely outcome.
Beset by all this doom and gloom, the Community Transport sector perhaps needs to be reminded of its roots. That it emerged to fill gaps in transport provision, especially those in bus networks, and especially those of disabled access. But transport provisions evolve, and so do the gaps. The contention is that Community Transport has forgotten how to challenge weaknesses in provision, how to find and fill those gaps – and perhaps that is because it has become fixated on buses?
The Community Transport sector should be adaptable, and should be adapting to the contemporary challenges: At its core, Community Transport goes right to the heart of two grand contemporary challenges – mobility and ageing – and in the context of propulsion and routing, could also become familiar with another two, clean energy and artificial intelligence. Community Transport operators tend to have the widest experienced in the difficult middle ground of public transport, that between private car and mass transit. They also tend to be (humanly) closer to the demands of their customers, and are thus more inclined to see transport as a means to an end (in economics, as a derived demand), than to treat transport as purely vehicle operation.
Vaunted future transport innovation is necessarily hyped to secure long-term technological investment, and may not arrive so soon, or even at all. For example, the difficult issues surrounding fully autonomous vehicles typically relate to areas such as legal liability in accidents or operation in shared human space – primarily societal challenges. The risks of exclusion – “designing out” prior mobility by focusing innovation only on core users – are none-the-less acute, not least because the rate of change of technology often exceeds that of legislation: And if, after two decades of disability discrimination legislation we still can’t force taxi drivers to load wheelchair passengers, what hope for an automated Uber?
Perhaps the most significant “innovation” is not even technological, but in why we travel. For example, over the past decade shopping trips have declined by 30%, while online shopping and home delivery has grown. Surely the home delivery of groceries is more cost-effective, and altogether more convenient, than loading shoppers with reduced mobility into Dial & Ride minibus and driving them to the supermarket once a week? Therein a plethora of issues: Some generational, such as digital exclusion among the elderly, which will fade with time. Others raise more fundamental policy questions, not least the role of such transport – to obtain groceries or to ease loneliness?
Conceptually, many Dial & Ride services could operate as “shared taxis” – more specifically, shared Private Hire: After adding wheelchair spaces, passenger capacity is often already not much more than eight passengers, so the reduction to 8 may be quite marginal operationally. Services are already fundamentally local, typically within one home licensing district. Pre-booking is already presumed, as is consent to share with strangers, both requirements of a shared Private Hire under Section 11 of the Transport Act 1985.
Since ammended by the Local Transport Act 2008, Private Hire Vehicle licenses can also be extended to operate registered local bus services using a Special Restricted PSV License under Section 12 of the Transport Act 1985. The method implies flexible route registrations, and hence regular operation between areas within pre-defined time ranges, but such conditions are already commonly met by semi-scheduled Dial & Ride operations that serve discrete geographic areas. Section 12 services are notable for requiring wheelchair access and, unusually for taxi-like operation, that the driver assist wheelchair loading on pain of fine (under Section 36 of the Disability Discrimination Act 1995).
As local buses, Section 12 services must be available to the general public. Disuading the general public with high fares would be akin to keeping one seat empty on a school bus contract, just to claim funding as a local public bus service. Logically, but not necessarily, operation as a local bus service would also imply participation in the National Concessionary Fares scheme, which (for a Dial & Ride-like service) would tend to result in almost all the intended passengers being carried for free. Yet operator reimbursement might (unfavourably) continue to be based on usage patterns in the wider local bus sector.
The Private Hire regime was designed to suit small businesses, so tends to lower administrative cost than the Passenger Service Vehicle regime. Driver licensing and training is more basic, as are vehicle maintenance requirements – although Dial & Ride style operation would likely still require a more substantially engineered vehicle than the family cars typical of Private Hire, in order to secure wheelchairs. Unlike Hackney Carriage licenses – which are often limited by arcane tests of “unmet need” that primarily serve to stabilise the volume of taxis – Private Hire licenses cannot currently be restricted, so long as new applicants meet the criteria for the license. And while it is possible to narrowly limit the specification of Private Hire vehicles, this is far less common than for Hackney Carriages.
Of course regular shared Private Hire cannot claim Bus Service Operators’ Grant (BSOG) – a subsidy on conventional fuel used. However BSOG is gradually losing its historic influence on operating costs – diluted by ongoing reforms and ultimately not applicable to future “clean” energy. Likewise smaller vehicles cannot normally claim zero-rated Value Added Tax – although by converting a 10+ seat vehicle to a lower capacity with wheelchair spaces, a “disabled passengers” zero-rating could apparently be claimed.
Against the current tumult of national “bus” policy, “taxi” legislation should offer an oasis of civic localism to the Community Transport operators: The most recent law – that relating to Private Hire – reflects the 1970s, an era when local government had much greater influence over its own policy decisions than is commonplace now. Local government retains substantial control over the detail of its local taxi licensing, in spite of regular calls for minimum national standards, and continued reluctance to accept mainstream policy agendas – just 2% of Private Hire Vehicles are accessible, even after the legal encouragement given by Section 165 of the Equality Act 2010.
Too often local authority taxi licensing is organisationally isolated from the same local authority’s wider transport functions. Consequently a local government funder of Community Transport as bus may not be able manage the same as taxi – even though, as outlined above, the two are functionally rather similar for many such services. And so what looks like a natural local synergy of authority and community, has become a combination that most of those involved steer away from.
The role of taxi licensing, at least in the words of the Department for Transport, is foremost to “protect the public”. A role akin to that of Traffic Commissioners in the PSV sector – primarily one of mechanics, not policy. Protecting the public can translate into protecting the drivers – I have previously argued the need is to regulate driver sanity in an otherwise excessively variable job – proto “Gig economy” employment regulation.
Intriguingly, there has historically been little or no taxi policy function locally: An anathema to contemporary national government, which requires formal policy processes to manage the sheer complexity of its United Kingdom. But surprisingly reasonable when we consider the nature of taxis: A notoriously self-organising, locally constrained, ostensibly commercial, market.
The lack of taxi policy function locally transpires to be important to the metastructure of public transport policy, because it means local government cannot justify, in policy terms, intervention in the market for taxi services. And in isolating taxis from equivalent bus market interventions (primarily supported bus services), the lack of a commercial bus service can always be cited as inhibiting public mobility – a market failure – even though there would almost always be a taxi solution for such journeys. Just at a far greater fare. In seeking to bridge from bus to taxi, the wider state could easily undermine the rationale on which it supports bus services.
What therefore differentiates “bus” and “taxi” – in broad policy terms – is the capacity (and associated cost) at which the state is willing and able to sustain fare subvention. That principle could provide local government a rationale for intervention on the taxi side of the legislative divide. Not necessarily in the core of the taxi market – individual mobility – but on the margins where the existing taxi sector generally performs badly, such as taxi sharing and disabled access – the Dial & Ride for eight, described above.
Sharing is Caring
Demand Responsive Transport (DRT) has a relentlessly experimental history in Britain, somehow never quite managing to establish itself in the mainstream of public transport, while somehow always remaining an appealing solution to contemporary mobility issues – be those social access to services, or more recent emphasis on filling gaps in mainstream mobility.
Away from deep rural local taxibus services, such as Cumbria’s Muncaster Microbus or fragments of Lincolnshire’s Interconnect, small-vehicle shared DRT shows few signs of success – from Stagecoach’s failed 2003 Yellow Taxibus in Fife, to a plethora of recent “startup” initiatives in London, such as Citymapper.
Analysis of Demand Responsive Transport experimentation often focuses on the financial difficulty of balancing fare to service – and that there may be no commercially viable combination for services midway between the core of taxi and bus markets. Recent initiatives by the traditional local bus industry, such as ArrivaClick or Oxford’s PickMeUp, have tended to use larger, more bus-like, vehicles. So bus-like that they might yet prove the old adage from the 1970s, that DRT gradually evolves into fixed bus services – services that are merely better suited to the underlying passenger demand than a service pattern planned in anonymously.
Likewise, shared taxi initiatives rooted in the taxi sector struggle to gain traction, even from locations with frequent overlaps in passenger demand, such as railway stations. Taxi shares generally only arise under significant economic duress – for example where supply is especially constrained due to a mass event: There’s no evidence that British people intuitively enjoy such sharing.
That conclusion is echoed by the performance of Blablacar, a ride-sharing technology that matches private car drivers with people making the same journey, allowing them to share costs. Blablacar is now so popular in France and Spain as to threaten traditional longer-distance public transport markets. Yet in spite of somewhat similar geography, infrastructure and costs, Blablacar has failed to gain market acceptance in Britain.
The key difference is societal – cultural, even philosophical: A British person’s sense of trust is generally rooted in and from their individual self. Sharing a vehicle with another unfamiliar self, especially just one, creates an environment which, on balance, lacks the familiarity for the person to feel comfortable. As the number of people sharing increases, the ability of any one to rival the person’s self diminishes, which is presumably why mass public transport is far more acceptable. Contrast that to Spain, where the knowable family-scale group is the default basis of understanding: It is much more intuitive to share experiences through a small group, and thus much easier to make the transition to sharing a vehicle with a few other, previously unfamiliar, people.
If, in Britain, community means only the sense that there should be one, Community Transport is functionally an oxymoron, whose delivery too readily exposes the dissatisfaction of the individual self with another. So in fostering actual community cohesion, Community Transport is surely just working at the edge of what is acceptable together. But to ask whether that edge is defined as 16 passengers or eight is to mistakenly consider need to be a constant: It transpires that if your health depends on it – the scenario in many community car schemes, that transport hospital appointment patients who have been refused official Patient Transport Services – then many will happily share a car with a relative stranger. Desperation, it would seem, drives us together.
Update: Immediately after this article was published, the Welsh Traffic Commissioner stated that “if an organisation had a private hire licence it was difficult to see how it could then be exclusively non-commercial.” While that verdict is only applicable to organisations trying to claim an “exclusively non-commercial” Section 19/22 “bus” operation alongside a smaller vehicle “taxi” operation, and each case must be judged on its own merits, the comment implies smaller vehicle operation is de facto commercial.