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EMPTY MILES AND TERM-TIME GAPS: The school-run contract that fills a taxi diary can still lose money
A dependable school run can look like the ideal taxi contract. The collection time is known, the destination is fixed and the work returns each term. Yet a full diary is not the same thing as a profitable route.
England’s home-to-school transport market is substantial. Department for Education figures for 2025/26 estimate that about 503,000 pupils under 16 were eligible for local-authority-funded travel. Around 195,000 received it because of special educational needs or disability.
Taxis and private hire vehicles have always had an important role within that provision. They can serve dispersed addresses, journeys for which a bus is impractical and pupils whose requirements call for an individual or small-group arrangement.
The Department’s 2025/26 figures put average local-authority spending for a pupil using a contracted taxi or PHV at £10,700 a year for pre-16 SEND transport and £4,500 for mainstream transport. Those are council costs per pupil, not driver earnings or the price of a single route. The estimates also draw on different numbers of responding authorities and require caution.
For an operator bidding on a route, the relevant calculation begins before the first passenger boards. The driver may travel to the collection address, wait for a pupil, complete the school journey and then drive empty to the next paying job.
The afternoon trip creates a second positioning problem. A route that appears to occupy two short periods can prevent the same vehicle from taking longer airport, account or private bookings at either end of the school day.
Term-time work also has a calendar attached. A price that covers fuel and wages during teaching weeks may not recover vehicle finance, insurance and other fixed costs across holidays, training days or periods when a route is suspended.
Contract wording deserves as much attention as the headline daily rate. Operators need to establish how cancelled journeys, pupil absences, school closures, late collection, altered addresses and additional waiting are treated before a driver is committed.
Passenger requirements can change during the contract. A suitable vehicle, seating arrangement or passenger assistant may be essential to one pupil’s journey, but those costs should not be assumed to fit inside a price calculated for an ordinary saloon transfer.
Safeguarding is part of delivering the service, not an optional contract extra. Department for Education statutory guidance addresses local authorities’ travel duties, while Department for Transport standards cover taxi and PHV licensing and safeguarding. A firm must understand both the contract requirements and the conditions attached to its licences.
A school contract can also involve two different council teams. The authority arranging transport may not be the authority that licensed the driver. Government information-sharing guidance says concerns should reach both where appropriate, allowing the transport contract and the driver’s licence to be considered separately.
That division makes accurate records valuable. The operator should be able to establish which driver and vehicle carried each pupil, who authorised a change and when a problem was reported. Substituting a car at short notice cannot mean losing the journey’s audit trail.
Reliability has a commercial value that the lowest bid may fail to capture. Keeping an appropriate spare vehicle or trained replacement driver available costs money, even on a day when neither is used.
Councils face immense pressure to control transport spending, and operators cannot assume every requested price increase will be affordable. Equally, a route priced below its real operating cost is unlikely to become more dependable as the contract progresses.
The strongest bid is therefore built route by route. It accounts for collection and return mileage, time between the morning and afternoon runs, vehicle suitability, staffing, cancellations and the income the vehicle cannot earn elsewhere. It has to be viable otherwise cab companies will simply look elsewhere for more viable options or sadly leave the industry altogether creating an even bigger problem for those demanding SEND services.
