East Devon fare setting review hit a red light as taxi trade voices concern over ‘Guildford’ tariff methodology
- Perry Richardson
- Jun 5
- 3 min read
East Devon District Council’s Licensing and Enforcement Committee has been presented with the results of a consultation on the proposed implementation of a formal hackney carriage fare setting procedure. The move follows a decision in November 2024 to explore a locally adapted version of Guildford Borough Council’s fare setting calculator.
The consultation, aimed at gauging the running costs of operating hackney carriages in the area, resulted in a poor turnout. Out of approximately 135 licence holders contacted, only six completed the survey—a response rate of just 4.5%. While the Council had intended to draft a full fare setting procedure, the limited engagement led officers to instead bring the consultation results to the committee for further direction.
Officers noted that some estimated figures for operating costs were broadly accepted—such as for vehicle price, fuel, tyres and licensing fees. However, other areas like insurance costs were considered significantly underestimated. No clear consensus emerged for most key cost categories including mileage, dead mileage and driver wages, due largely to the small sample size and varied nature of operations across the district.
Feedback from drivers outside the survey also highlighted a general reluctance toward a fare increase. Many expressed concern that fares are already too high and risk deterring passengers, particularly in areas with a high proportion of older residents. A smaller number of proprietors felt a rise was necessary due to increased operating costs, including the April 2025 increase in the national minimum wage.
Despite the split in opinion, there was moderate support for the development of a transparent fare setting framework. Licensing officers outlined the potential benefits of this approach, including clarity for both drivers and passengers and improved ability to respond to cost changes without relying on infrequent large adjustments.
However, officers advised that without more substantial input from the trade, continued development of the procedure would require extra resources. Staffing reductions and upcoming national consultations on taxi licensing reform further complicate the picture, raising questions about how long any new local procedure would remain relevant.
The committee has now been asked to decide whether to proceed with drafting the new fare setting methodology, pause the process until 2026, or continue using the existing fare review approach based on inflation and fare comparisons.
What is the ‘Guildford Methodology’ for taxi tariffs?
The Guildford methodology for setting hackney carriage fares is a cost-based fare setting model developed by Guildford Borough Council. It is designed to provide a transparent and systematic way of calculating maximum taxi fares by using a structured formula that reflects the real costs of operating a licensed hackney carriage.
The methodology calculates a unit fare based on the following core components:
1. Vehicle costs:
This includes the purchase price of the vehicle (new), depreciation over time, and associated costs such as tyres, servicing and repairs.
2. Running costs:
These cover fuel, insurance, vehicle licensing fees and other operating expenses such as MOT tests and meter calibration.
3. Driver’s income:
A baseline wage is included to ensure that the driver earns a viable income. This can be set in line with the national minimum wage or an agreed standard.
4. Annual mileage:
The formula uses an average number of annual metered miles that a hackney carriage is expected to cover. It takes into account both fare-paying miles and “dead” mileage (travel without passengers).
5. Cost per mile calculation:
Once all the cost components are added, the total is divided by the number of fare-paying miles to determine a cost-per-mile figure. This is then used to calculate the tariff structure, including the starting fare and subsequent mileage rates.
6. Adjustment for local conditions:
Although based on a standard template, the model can be adapted for local economic conditions and operational variables. For example, Guildford’s data may be adjusted to reflect fuel prices, labour rates or insurance costs specific to another district.
East Devon District Council proposed using the Guildford methodology as a basis for their own fare setting procedure, but with adjustments for local factors. The aim was to introduce a more consistent and justifiable approach to fare reviews. However, due to limited data from the local trade and staffing constraints, officers have not yet completed the adaptation and are seeking further direction from the Licensing and Enforcement Committee.
