Local authorities across the UK have quite rightly been reviewing taxi tariffs following the rapid spike in fuel pump prices and the rate of inflation.
For some taxi drivers a rise in tariffs represents the first increase in over a decade. Inflation based rises in the past were rejected in some cases so that licensed taxis could remain competitive with lower priced private hire services being offered.
Fast forward to post-pandemic and demand for taxi services has boomed partly due to a lack of drivers across the industry. Prices for minicab services have also rocketed due to driver supply issues and increased operating costs based around new VAT and worker’s rights rules.
In a bid to entice new drivers into the industry, and to help cabbies hit hard by the rising costs, most tariffs have been recently reviewed. In the case of one authority, East Lindsey Council, they have reviewed the cost of a taxi TWICE in a year.
Most licensing authorities have chosen to increase fares across the board, including starting flag fall rates and even soiling charges. However, in the capital late night fares were frozen.
The taxi fares on Tariffs 1 and 2 in London increased by 5.51% and the meter drop increased from £3.20 to £3.80, but Tariffs 3 and 4 were frozen. The frozen tariffs represent journeys between 10pm and 5am, Bank Holidays and long- distance roaders.
It’s always busy in the evening so why does it matter?
The higher value tariffs handed to cabbies are used to cajole drivers to work unsociable hours, deal with more alcohol fuelled passengers and meet the demand set by late night partygoers as trains and tubes stop running.
However, by closing the pay gap between easier daytime work and harder graveyard shift work, drivers are choosing the easier option. Late at night and even at the weekends, demand has scaled up massively, but crucially drivers don’t need to work these hours to earn the living required as before.
There has been talk of a second tariff review based on the ongoing fuel crisis and Tariffs 3 and 4 will need addressing second time round. On 9 March, Transport for London (TfL) Finance Committee met to discuss and approve the new black cab taxi tariff which arrived on 30 April.
Ben Story, Vice-Chair of the Finance Committee, shared his worries that escalating fuel prices will need to be monitored. Story said: “I’m just conscious of how fuel prices are rising potentially really dramatically, so I think we might find that we have to review this more quickly.”
The committee were concerned that if fuel prices continued on their rapid growth in the next few weeks the tariff increases agreed could be ‘overtaken by events’.
Later in the talks the panel agreed to review and report on how fuel costs are impacting the taxi industry in six-months’ time.
As fuel prices and inflation show no let up, TfL and a whole host of other licensing authorities who introduced more reserved increases could be heading to the taxi tariff drawing board again.