Wolverhampton City Council has come under fire from authorities across the country concerned about inadequate licensing checks on mini-cab drivers that then operate in their areas.
Six West Midlands councils have protested to the government over a legal loophole that allows neighbouring Wolverhampton to collect huge sums by licensing private hire vehicles which under the Deregulation Act 2015 can then operate anywhere. They said almost half of minicabs in Birmingham at weekends were licensed elsewhere, while Wolverhampton licences have been reported as far afield as Brighton & Hove and Nottingham.
Wolverhampton’s income from licensing has increased by almost five-fold over the past five years, to more than £1.2m in 2016-17.
Critics say the situation creates unfair competition and have raised concerns about public safety. They claim drivers use Wolverhampton because it is quicker and cheaper to get licensed there and with less onerous conditions.
The six West Midlands councils told transport minister John Hayes the legislation should change and noted: “We have examples of drivers with convictions for violence and sexual offences who have been refused a licence by one authority and yet another authority has granted them a licence.”
They went on: “We are seeing widespread cross border issues with drivers frequently working in local authorities that have not granted their licence.
“This not only creates feelings of resentment between drivers, but it raises questions about how local authorities can enforce licensing conditions that they have not imposed against drivers that they have not licensed.”
In recent years poor taxi-licensing processes have been implicated in cases of child sexual exploitation, increasing the focus on ensuring adequate checks are made of drivers.
Jayne Innes (Lab), Coventry City Council’s cabinet member for city services, told LGC she had met with politicians from Wolverhampton who said there were 241 Wolverhampton registered taxis working in Coventry.
She said: ”These drivers are using Wolverhampton as a flag of convenience. I found their attitude really disappointing, they just said they had the legal power to do what they do.”
Cllr Innes said Wolverhampton’s only concession was to agree to joint compliance teams in Coventry at weekends.
The six councils will press West Midlands Combined Authority mayor Andy Street (Con) to enforce a uniform licensing scheme across the conurbation.
Elsewhere, a Nottingham City Council spokesman said: “We have written to Wolverhampton Council to raise our concerns with them about this issue”, while Derby City Council has objected to an advertisement placed by a local company offering to help taxi drivers secure licences from Wolverhampton.
Brighton & Hove City Council confirmed it had received reports from local taxi-drivers of Wolverhampton registered vehicles operating in its area. A spokesman said this was “perfectly legal” and Wolverhampton had been carrying out enforcement checks in the south coast city.
Alan Bolshaw (Lab), chair of Wolverhampton’s licensing committee, said: “[We have] what we believe to be the best taxi licensing system in the UK because we had the foresight to innovate, reduce red tape and invest in technology to streamline our processes.
“We have a very clear message to our critics - stop unfairly deflecting the blame for their failure to modernise onto us.
“They should follow our lead and embrace technology… we see no reason why we should downgrade that to the detriment of customers just because other councils have failed to keep up.”
Figures released in response to a Freedom of Information request show Wolverhampton took £798,958 in 2016-17 for licensing vehicles and £496,955 for drivers, against only £262,901 from both five years ago.
Licensing income is ring-fenced and cannot be diverted to general revenues. Cllr Innes said she found it baffling that Wolverhampton wanted to accumulate money it could not easily use.
Wolverhampton’s opposition leader Wendy Thompson (Con) said: “Some of the money raised is used to employ licensing staff to go around the country to check on Wolverhampton-licensed drivers, but there is about £200,000 surplus to no purpose. I do not understand what they are doing.”
But Cllr Bolshaw said revenue was reinvested in reduced fees and “a significant investment in our compliance function”, which had monitored Wolverhampton registered vehicles in areas from Sussex to Stockport.