CROSS-BORDER LICENSING: Why MPs say out-of-area working has become the defining issue in taxi and PHV regulation
- Perry Richardson
- Jun 10
- 5 min read
Out-of-area licensing has emerged as the single most contentious issue facing the taxi and private hire industry, with MPs now urging the Government to produce a clear plan to reduce the practice after concluding it has damaged public confidence and weakened local enforcement.
The Transport Committee’s report, Raising the standard: licensing of taxis and private hire vehicles, dedicates an entire chapter to the issue and paints a picture of an industry increasingly frustrated by a system that allows drivers licensed hundreds of miles away to operate routinely in areas where local licensing officers have little power to intervene.
For many in the trade, the debate goes far beyond administrative boundaries. It centres on fairness, public safety, enforcement and whether local licensing standards have any real value when drivers can simply obtain a licence elsewhere.
How out-of-area licensing became a national issue
Under current legislation, a private hire vehicle driver can be licensed by one authority while carrying out most of their work in another, provided the operator, vehicle and driver all hold licences from the same authority. This arrangement, known as the “triple lock” requirement, was further influenced by changes introduced through the Deregulation Act 2015, which expanded cross-border subcontracting opportunities.
Transport Committee report reveals mounting concerns over enforcement, public safety and licence shopping as ministers face calls to curb out-of-area working
The issue has grown rapidly alongside app-based booking platforms. Unlike traditional operators, modern technology means drivers are no longer constrained by local radio circuits or geographical operating areas.
The Transport Committee found that out-of-area working is now “a widespread feature of the taxi and private hire vehicle market”.
What was once viewed as an occasional necessity has evolved into a business model that some licensing authorities argue is actively encouraging drivers to seek licences in areas with lower fees, faster processing times or less demanding requirements.
Licence shopping at the heart of concerns
One of the strongest themes emerging from the inquiry was the issue of licence shopping.
The report notes concerns that some drivers deliberately obtain licences from authorities with “lower standards, easier application processes, lower costs and weaker local enforcement”.
Those concerns were reinforced by Baroness Louise Casey’s 2025 audit into group-based child sexual exploitation, which warned that the current licensing framework allows drivers to obtain licences from authorities perceived to have less stringent safety standards before operating elsewhere. The report highlighted frustration among authorities that impose rigorous standards only to see drivers licensed elsewhere working freely within their boundaries.
The language used by some witnesses was particularly stark.
Blackpool Taxi Association described out-of-area working as “the root cause to all that’s wrong”.
Rotherham Metropolitan Borough Council went further, describing it as “the single biggest threat to the safety of the travelling public in Rotherham”.
The enforcement problem
A recurring criticism throughout the inquiry was that licensing authorities often lack meaningful powers over drivers licensed elsewhere.
The Committee heard evidence from taxi driver Harlan Kocabey, who said drivers working in his area but licensed elsewhere know “local licensing officers have no power over them, so they do what they like”.
Rotherham Council similarly argued that out-of-area drivers know enforcement officers are “essentially powerless” against them.
The problem extends beyond local licensing teams.
The report later highlights that councils can only take direct enforcement action against drivers and vehicles they have licensed themselves. If concerns arise about a vehicle licensed elsewhere, local authorities often have little option beyond reporting issues back to the driver’s home authority.
For many authorities, this creates a disconnect between responsibility and control.
Wolverhampton becomes the focal point
No discussion about out-of-area licensing can avoid Wolverhampton.
The report highlights that Wolverhampton licensed 33,893 private hire vehicles during 2025, compared with 10,768 in 2020.
Its rapid growth has made it the largest licensing authority in the country and a frequent target for criticism from parts of the trade.
However, the Committee heard conflicting views on why drivers choose Wolverhampton.
Veezu’s Andrew Wescott pointed to cost differences, noting that a three-year driver licence costs £138 in Wolverhampton compared with £336 in Portsmouth.
But Wolverhampton strongly rejected suggestions that it operates lower standards.
Chief Operating Officer David Pattison pointed to a 55% failure rate on the council’s day-long licensing assessment as evidence that obtaining a licence is not straightforward.
The Government also defended Wolverhampton’s standards. Transport Minister Lilian Greenwood told the Committee that Wolverhampton’s standards “are not significantly lower than elsewhere”.
Drivers feel the impact
Perhaps the most revealing section of the report comes from a private roundtable discussion with drivers.
The Committee states that out-of-area working was the “dominant concern” raised by drivers from across England.
Some participants reported earnings reductions of between 30% and 40% due to increased competition from drivers licensed elsewhere.
One driver told MPs: “Nobody seems to have power over cross-border drivers.”
The Committee also noted that concerns about out-of-area working dominated confidential submissions from drivers and operators across England. Many argued it was undermining enforcement, depressing earnings and eroding standards.
Why banning it isn’t straightforward
Despite widespread criticism, the Committee stopped short of calling for a ban. Witnesses highlighted the practical realities of modern travel patterns and app-based booking systems.
Bolt’s Kimberly Hurd told MPs: “Cross-border is essentially the way people live and work.”
Uber’s Emma O’Dwyer argued that passengers would not expect journeys to be restricted by local authority boundaries and warned that many trips currently undertaken simply would not happen under stricter restrictions.
The Licensed Private Hire Car Association also warned that forcing drivers to return to their licensing area between jobs would generate unnecessary empty mileage and carbon emissions.
Recognising these realities, the Committee concluded that “outright prohibition would be impractical”.
What happens next?
Rather than banning cross-border working, MPs are calling for measures that encourage drivers to become licensed where they actually operate.
The Committee’s recommendation is direct: “We urge the department to bring forward a clear plan to curtail the extensive practice of out-of-area working and create greater incentives for drivers to license in the locality in which they operate.”
The report argues that reducing out-of-area licensing would make enforcement easier, improve accountability and help restore public trust.
With the Government preparing a draft Taxi and Private Hire Vehicle Bill and promising a national licensing database, stronger enforcement powers and national minimum standards, the debate over out-of-area working now sits at the centre of the industry’s future.
What is becoming increasingly apparent is that MPs no longer see out-of-area licensing as a side effect of the current system. The Committee’s findings suggest it has become one of the defining challenges that future reforms must address if confidence in taxi and private hire regulation is to be rebuilt.
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