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Myth and Reality
TDO response to the OFT investigation into the "Taxi and Private hire Trade".
Report Date March 3 2004
Taxi Driver Online announces the publication of 'Myth and Reality', a 70-page paper examining the issue of restricted taxi numbers.
BACKGROUND
In November 2003 the Office of Fair Trading recommended that any restrictions on the number of taxis operating should be lifted. Such controls are currently operated by almost half of UK local authorities.
CHAPTER SUMMARY
Chapter 1 describes quantity controls on taxis as 'statutory cartels' and concludes that a not inappropriate description of the economic consequences could be 'tantamount to institutional theft'.
Chapter 2 outlines the superficial approach to measuring the number of taxis operating, and how restricting numbers packs an increasing number of drivers into a static number of vehicles to the benefit of vehicle license (plate) holders, and also results in burgeoning private hire vehicle numbers.
Chapter 3 shows how plates issued by local authorities for next to nothing can attain values of tens of thousands of pounds because of the closed market. The total worth of these plates can reach tens of millions of pounds in locations like Glasgow and Manchester, and the total UK worth is probably well in excess of a quarter of a billion pounds
Also highlighted is the exploitative, discriminatory and anti-democratic nature of these policies in relation to excluded drivers, who usually constitute a majority of the local taxi trade
Other effects are also examined, such as the illegal taxis in Scotland operating under a facade of licensed legitimacy, and how many Scottish local authorities have gotten round the legislation that did not allow for plate sales, and the underhand and perhaps illegal manner in which they have done this.
Chapter 4 outlines the deficiencies of the limitations placed on these cartels, and how these limitations have grossly distorted the number of taxis operating in local markets. We also point out how these limitations can be manipulated by the cartels to maintain the status quo, and how the cost of the chronically bureaucratic process can be borne by the tax payer.
Chapter 5 provide an extensive critique of the arguments used to justify these cartels, including false claims that lifting numerical controls on taxis would lead to sex offenders and drug dealers entering the trade, not to mention grossly misleading and specious statistics used to scare monger on taxi numbers.
Also highlighted are the self-serving and hypocritical arguments made by representative groups like the Transport and General Workers' Union.
Chapter 6 concludes that restricting taxi numbers is neither socially just nor economically efficient.
An annexe provides some comment on the House of Commons Transport Committee's report on the OFT's recommendations.
The paper can be downloaded from:
http://www.taxi-driver.co.uk/reality.pdf
(PDF format, 337kb)
http://www.taxi-driver.co.uk/reality.doc(Word format, 310kb)
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