The LPHCA has formally rejected Transport for London’s (TfL’s) proposals to start to congestion Charge London’s PHVs. Our response to TfL's Consultation has been published in full below. As well as sending in a strongly worded response to the proposal, LPHCA Chairman Steve Wright has outlined to the Greater London Assembly Transport Committee the many reasons why London’s PHVs should not be congestion charged.
The LPHCA has also been in touch with the Competition and Markets Authority (CMA), disabled groups and many others to show the damage this would cause. The LPHCA consultation submission follows and the association reminds everyone to continue to promote and get signatures for the petition it started against the proposals. We are still running a Congestion Charge petition, which has over 6,500 signatures. This is continuing to increase and we still want people to sign it; for those who have not done so please click HERE to sign it now.
LPHCA Response to the Proposed Removal of London PHV’s Congestion Charge Exemption
The proposal that London Private Hire Vehicles (PHVs) should have the congestion charge exemption removed but London Taxis would remain exempt and not required to pay anything is not fit for purpose.
Proposals and statements from TfL say they believe that it is necessary to make two changes to the discounts and exemptions available for the Congestion Charge. It is alleged that ‘these changes are designed to reduce traffic and congestion, which is expected to have a consequential beneficial impact on air quality and, in the case of updating the ‘green discount’, incentivise the use of low emission vehicles in the zone’. We completely disagree with the exemption removal and set out some of the reasoning below.
TfL say that in recent years they have seen a substantial increase in the number of PHVs in London and that more than 18,000 different PHVs now operate in the Congestion Charge zone each day during charging hours. The LPHCA however believes that more PHVs means less private car movements. TfL state they are proposing PHV Congestion Charging to help tackle the congestion challenge facing London. The above assertions and assumptions are misleading, as there is little credible research or evidence to support them. On the contrary, evidence we have had sight of finds major flaws in the proposals, which seem to be based on many assumptions and a great deal of speculation, rather than hard facts, evidence or proof.
The LPHCA and others are very concerned with the potential removal of the PHV exemption, which we feel would be a measure that will harm, many individuals and businesses, increase costs and will not, in our considered view, meet any of the very few positive outcomes alluded to.
As the principal body that secured the exemption in the first place, alongside Trade Unions, the Private Hire Board and the Chauffeur & Executive Association, the LPHCA outlined why the exemption was needed at the time, to the then Mayor of London, Ken Livingstone. We also spoke to his Transport Advisor, Mark Watts (who heavily influenced the first ever Mayor’s Transport Strategy), and the then Chair of the Greater London Assembly (GLA) Transport Committee John Biggs. We also attended meetings with the team that assessed who should be exempted from the Congestion Charge and set out the reasoning as to why licensed PHVs must be exempt.
Removing the Congestion Charging exemption would be extremely damaging to the London PHV Industry and would add extreme costs. Such costs would initially need to be paid by registered keepers, drivers, vehicle hirers, replacement vehicle providers, in some cases by operators or in other cases combinations of all of these. The bottom line is ultimately that the extra cost would need to be passed onto consumers. The administration and management of PHVs losing Congestion Charge Exemption in isolation would be very costly and time consuming.
PHVs are the main ‘door-to-door’ element of the transport system that reduces car ownership and the number of vehicles in crowded towns and cities, therefore the concept of congestion charging a primary mode of essential transport is completely flawed. PHVs are also the most affordable and available mode of ‘door-to-door’ transport in London and are widely used by disabled people, the elderly and the most vulnerable in society.
Whilst new technology has seen an increase in the number of PHVs in central London, technological innovation has been used to more dynamically allocate vehicles, which has massively reduced dead mileage and, as a consequence, reduced emissions too. London’s PHVs are far more environmentally friendly, being on average three years younger than London taxis and unlike taxis, PHVs do not drive around the capital’s road network seeking work. As PHVs are currently considerably cheaper than taxis, the difference between the price of a London taxi and a London PHV will close dramatically if the London PHV Exemption is removed. Some journeys could increase by around 300% if they were subject to the congestion charge, with fares varying widely from company to company, based on where their primary operating area is.
Whilst it is being proposed that wheelchair accessible PHVs would retain their Congestion Charge exemption, the vast majority of disabled passengers are not wheelchair bound and Sir Bert Massie of the Royal Association for Disability Rights (RADAR) stated to the government’s Transport Select Committee circa 1994 that many disabled passengers prefer ordinary PHVs to purpose-built wheelchair accessible vehicles.
London taxis, under these proposals, would not pay any Congestion Charge, so there is significant evidence to support the assertion that the PHV sector is being unfairly discriminated against in several ways. Firstly, these proposals would create a market distortion that we believe could and would be challenged under competition laws and state aid regulations. Secondly, because of the diversity of PHV drivers being predominantly ethnic and from lower socio-economic groups, there would be serious equality and discrimination issues. Thirdly, the impact on many elderly,vulnerable, disabled* and ‘less mobile’ passengers could be considerable, not only in cost but also availability if PHV drivers did view the congestion charge zone as a ‘no-go’ area due to cost.
* Except for purpose built wheelchair accessible PHVs
The regulatory Impact Assessment by Mott MacDonald (which can be viewed HERE) shows few potential benefits, alongside a host of potential negative impacts on PHV operators, drivers, vehicle owners and consumers.
There is little or no hard evidence to support anything other than ‘a very minor at best’ reduction in congestion. As industry experts the LPHCA cannot foresee any reductions in congestion and a comparable modal switch would simply mean using the far more polluting (on average) London licensed taxis. People often use PHVs because they do not have a car, they need to make a ‘door-to-door’ journey or because they are unable to use public transport for a variety of good reasons.
As PHVs reduce congestion and are far more environmentally friendly than the vast majority of London taxis, we can only conclude that this measure would discriminate in favour of London taxis and that TfL would be using regulation to raise money and/or change market share by stealth. There are a number of very questionable assumptions throughout the impact assessments. For example, Cambridge Economic Policy Associates (CEPA) have suggested that those operators who are able to specialise their fleet will be able to minimise the costs associated with the removal of the exemption. We do not believe this is possible.
It is assumed by CEPA that only larger operators with over 500 PHVs will be able to do this. The larger operators we have spoken to say it isn’t possible and we agree because PHV drivers rarely have predictable or the same journey patterns.
CEPA analysis also assumes that the cost of the charge will be spread between PHV passengers (across multiple passenger trips), PHV drivers and PHV operators. This poor assumption implies that passengers who don’t go into the congestion charge should subsidise those who do, which we consider extremely unethical.
Prior to, and during, the Olympic and Paralympic Games, TfL and the Olympic Delivery Authority engaged with the PHV industry to understand how the industry works and how best PHV operators could prevent problems and provide solutions to help deliver trouble-free transport for the Games.
This engagement gave those in the respective organisations the ability to put forward proposals that contributed to delivering the best Olympic transport provision ever in the 2012 Games. The LPHCA and PHV operators went to dozens of meetings and gave many constructive ideas that were taken up.
By contrast, the industry found out about the proposals to remove the congestion charge in the media. The engagement with the trade on this matter by comparison was miniscule and came mainly in the form of eleventh-hour work by Mott MacDonald and Cambridge Economic Policy Associates (CEPA). The PHV industry and its wealth of expertise has simply not been engaged with properly.
It is therefore not surprising that congestion charge exemption removal proposal is not fit for purpose. There are many ways to improve congestion in London and to improve air quality, which the PHV Industry has done ‘year-on-year’ since it has been licensed. Not engaging with us in the considered way that took place prior to the Olympics, shows serious flaws in the policymaking hierarchy who are pushing for this proposal to happen. It is no surprise that London Assembly members have recently supported a motion that got cross-party backing not to remove the PHV Congestion Charge exemption by a massive majority.
The PHV industry in London is an exemplary example of a regulated industry that has risen to the challenges of becoming greener and more environmentally friendly. At our 2018 Road Show on 27th September 2018, we had on display the very latest electric, hybrid and fuel cell vehicles. We also had representatives of TfL’s ULEZ team present, as well as Source London, who are a London-wide electric vehicle charge point network, and both were key-note speakers.
The LPHCA demonstrates with actions and words its commitment to environmental improvements, but the Congestion Charge removal proposal flies in the face of the clean and green PHV industry’s ambition for these aims.
If the industry is subjected to the additional costs that it would need to meet by removing its congestion charge exemption, its move to even more environmentally friendly vehicles will be seriously inhibited, so the proposal is self-defeating.
We hope that this consultation response is listened to otherwise London’s PHV industry will have no choice but to challenge these proposals should they move forward. As a trade body we have already had dialogue with the Competition and Marketing Authority (CMA) on the competition aspects, and we are also in communication with disabled groups and their key representatives to make them aware of the cost and supply implications.
We sincerely hope that we are listened to and these potential extremely damaging proposals are dropped, so we can engage on how we can actually reduce congestion and improve the air quality in London, which we believe will be compromised if these flawed proposals progress any further.
Steve Wright MBE, Chairman LPHCA