Minister concerned about ‘race to the bottom’ potential as Wolverhampton taxi and private hire licensing model comes under fire
- Perry Richardson
- 1 hour ago
- 2 min read
Concerns over so-called licence shopping in the taxi and private hire sector moved centre stage as MPs questioned a Government minister on wide variations in licensing standards across England, with City of Wolverhampton Council repeatedly cited as a focal point during parliamentary evidence.
During an evidence session of the Transport Committee’s inquiry into taxi and private hire vehicle licensing, Laurence Turner, Labour MP for Birmingham Northfield, warned that the dominance of a small number of licensing authorities risked encouraging lower regulatory standards nationwide. He said evidence submitted to the committee suggested some councils were reluctant to apply tougher discretionary requirements for fear of losing drivers to more permissive authorities.
Turner told MPs that Wolverhampton had openly stated it did not, as a matter of policy, go beyond the minimum standards currently recommended by the Department for Transport. He added that this had created an incentive for drivers to licence there rather than with authorities seeking to impose higher local standards.
Responding to the point, Lilian Greenwood, Minister for Roads at the Department for Transport, acknowledged the scale of cross-border licensing and said she did not consider the current situation satisfactory.
Minister concedes licence shopping is driving down standards ahead of planned national reforms
The minister said: "I don't think it's a good situation that so many drivers are licensing with Wolverhampton.”
Greenwood said she was concerned that large numbers of drivers were choosing Wolverhampton licences, even while noting that some of the council’s safeguarding practices, such as daily checks against national databases, were robust.
Greenwood told the committee: “I am concerned about the potential for there to be, because of licence shopping, that it can become a race to the bottom, and that's precisely why we want to introduce the national standards.” She added that this was a key driver behind the Government’s push to introduce national minimum standards for taxis and private hire vehicles.
She said the intention was to prevent drivers from shopping around for the least demanding licensing regime saying, “I don't want people to be shopping around for licences".
The evidence session formed part of the Transport Committee’s inquiry into the licensing of taxis and private hire vehicles, which is examining whether the existing legislative framework, much of it dating back decades, remains fit for purpose. MPs are assessing how inconsistent standards between licensing authorities affect passenger safety, enforcement and market fairness.
In November 2025, the Department for Transport confirmed it intended to legislate for National Minimum Standards to create a baseline for licensing across England. Ministers have argued that while local authorities would retain some discretion, a consistent national floor would reduce regulatory arbitrage and improve public confidence.
The committee is also scrutinising whether stronger enforcement mechanisms will be required alongside national standards, as well as the future allocation of licensing responsibilities and the setting of fees. Evidence heard so far has highlighted growing pressure on councils attempting to maintain higher standards while competing with authorities offering cheaper or less onerous licensing routes.
The inquiry is expected to conclude in the coming months, with recommendations likely to influence the scope and design of any forthcoming legislation. For operators and drivers, the outcome could reshape where licences are held and how standards are enforced across council boundaries.
