news analysis: council grants
Falling through the loopholes Mark Bursa
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Who are the drivers who can’t get local authority Covid-19 support?
he deregulation act of 2017 made
taxi and private hire licensing into a competitive market – and drivers took advantage in their thousands.
But now, all those drivers who got licensed in Wolverhampton and other lowcost areas are finding they are missing out on much-needed coronavirus support schemes. The government devolved responsibility for Covid-19 support to local authorities. This has created a “postcode lottery” of grants, with massive variations from council to council. But many drivers are missing out completely as a result of council rules that only offer payments to those who live in the same local authority area in which they are licensed. As a result, many thousands of drivers who took advantage of cheaper licensing through councils such as Wolverhampton, despite neither living nor operating in
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their chosen licensing authority area, are finding they are not eligible for handouts. Wolverhampton has in fact been one of the most generous in terms of grants. Taxi and private hire drivers who have been significantly impacted by the Covid-19 pandemic can apply for a £2,000 grant via the Additional Restriction Grant – Taxi and Private Hire Grant scheme. But the one-off payment of £2,000 will not be available to drivers from other towns and cities who have taken advantage of Wolverhampton’s low licensing rates and operate Wolverhampton-licensed cars elsewhere. To qualify, drivers must have lived in Wolverhampton for the past 13 weeks and must have notified Licensing Services of their current address. They must also present a driving licence showing a Wolverhampton address. There is a good reason for Wolverhampton doing this. According to DfT figures, there were 18,110 licensed taxi and private hire drivers registered in the city at the start of the pandemic in March
2020, far more than in the much bigger neighbouring city of Birmingham, which had only 6,340 licensed drivers. But fewer than 4,000 of Wolverhampton-licensed drivers actually live in the city. This means Wolverhampton would be facing a bill of more than £36 million if every driver it licensed was able to claim the £2,000 grant. So while the council was happy to take the drivers’ money for their licenses, it has found a loophole to avoid the bailout. However, the numbers simply don’t add up for the council. Wolverhampton raised an estimated £3.7m in licence fees in 2019, and a total of £8.7m between 2017 and 2019, as it issued licenses to drivers from as far away as Truro in the south-west and Perth in Scotland, as it is allowed to do under the terms of the Deregulation Act. In 2019 a total of 11,461 applications to Wolverhampton Council came from drivers based in Birmingham, while there were 2,457 from Manchester, 1,926 from Coventry, 1,279 from Leicester, 1,102
APRIL 2021
