Private hire industry on ‘verge of collapse’ says GMB calling for vehicle payment deferral extension

GMB union called on the Chancellor to help the thousands of hard-up private hire drivers at risk of losing their vehicles.

In the letter to Rishi Sunak, sent before this week’s Budget announcement, the GMB and several other taxi and private hire industry bodies detailed their concerns for thousands of drivers who are now at risk of losing their cars after a Financial Conduct Authority (FCA) ban on repossessions ended on 31 January.

The groups, which also included the Mayor of London Sadiq Khan, called on the Treasury to enable the Finance and Leasing Association (FLA) to extend full or partial payment deferrals until such a time as drivers have started to recoup their lost income.

Depending on the progress of the vaccination programme and the emergence from lockdown restrictions, this could be in summer 2021.

The UK’s taxi and minicab industry - which sees 350,000 drivers perform services from private journeys to NHS patient transport, school and vulnerable children transport services and vulnerable adult transport services – is on the verge of collapse, GMB says.

Through the pandemic, demand has plummeted with many operators reporting an 80% drop in bookings month upon month.

Discussions with Treasury officials and the Finance and Leasing Association are to continue after the Budget according to other trade sources.

Steve Garelick, GMB Organiser, said: “There has never been a time drivers need help as much as they do now.

“Our private hire sector - is the largest transport sector in the country and provides vital transport for the NHS, schools, as well as vulnerable and disabled people - is on the verge of collapse.

“Through no fault of their own, drivers are set to lose their cars, their very livelihoods that they’ve worked so hard to own.

“With lack of income and little chance of a full return to normal for some time, GMB is committed to getting the best assistance possible for all in this position.

“A trade union wide decision to make this request with London’s mayor reinforces the concerns we all have.”

Speaking earlier this week on the same subject, Steve McNamara, Licensed Taxi Drivers’ Association (LTDA) General Secretary, said via Taxi Newspaper: “We have been trying to find a solution to help drivers struggling with finance payments and at risk of losing their vehicles. This is particularly important now, as the Financial Conduct Authority’s ban on repossessions came to an end on 31st January and many drivers face the devastating prospect of losing their cab or being forced to voluntarily surrender it.

“It continues to be an uphill battle to find a solution and the Government has so far been unwilling to help. However, the Finance and Leasing Association (FLA), which represents the finance companies, came back to us in January after realising the third lockdown meant that drivers situations were unlikely to improve any time soon.

“They also see that it is in no one’s interest the finance companies or drivers to start repossessing taxis to sell at auction, at a time when there is no market and residual values have plummeted. The FLA have made an offer to the Treasury proposing a solution that would allow them to offer taxi drivers in these difficult circumstances further payment holidays or at least partial payment deferrals until at least July, and potentially until the end of 2021.”