Taxi Licensing, Regulation and Control an Analysis of Taxi Supply in Medium Sized UK Cities

James Cooper Taxi Licensing, Regulation and Control Taxi Licensing, Regulation and Control An analysis of taxi supply in medium sized UK cities Submitted in partial fulfilment for the degree of Doctor of Philosophy at Napier University, Edinburgh James Michael Cooper Nov, 2007 1 James Cooper Taxi Licensing, Regulation and Control Acknowledgements Significant thanks and grateful acknowledgement is appropriate for the assistance and advice of Mr Bill McIntosh of the Scottish Taxi Federation, Messrs Harry Fitzsimmons; William, and Christopher McCausland of the combined group of Belfast private hire taxi proprietors associations; Adele Watters of the Department of the Environment for Northern Ireland; and Jo Bacon of the Department for Transport. I also wish to acknowledge and thank the following organisations for their input and comments (in no particular order), the cities and licensing authorities of Fresno, San Diego, Glasgow, Edinburgh, Belfast, and West Dunbartonshire. To the participants of all of the survey work completed in the course of the work, and particular thanks to the Accessibility Panels and Forum. Thanks also to the Community Transport Association; the Transport and General Workers Union; and the large number of individual council officers, taxi proprietors and taxi drivers whose comments have been invaluable in achieving a full picture of taxis. Finally, the undertaking and completion of this thesis has been achieved in no small part thanks to the continued and appreciated encouragement and dedication of my supervisors, Professors Margaret Grieco, Ron McQuaid and Kevin Cullinane. 3 James Cooper Taxi Licensing, Regulation and Control Dedication For Ursula and Sarah. 4 James Cooper Taxi Licensing, Regulation and Control Abstract The primary objective of this thesis is to provide a new approach to optimizing the supply of taxis as applied in UK cities. Taxi supply, both in the UK and elsewhere, is controlled by a series of regulations (defined in relation to controls affecting Quantity, Quality and Economics - QQE) that influence the ability of the market to respond structurally - in terms of access to the market, and operationally - affecting the ability to provide services within the market. This thesis identifies the existing structures in taxi regulation. It explores legislative disagreement and differences in both academic and practitioner literature and perspectives. The thesis provides both a new approach to, and a new model of, taxi regulation, which accommodates existing differences in regulatory structures. The thesis builds on existing methods applied in determining individual elements of control - which may be appropriate to some elements of control but fail to address a full cross section of impacts - and provides an enhanced approach and new modelling framework for taxi regulation. In constructing this approach use has been made of both survey and case study methodologies. Survey data has been collected from two surveys, of 52 cities and 21 licensing authorities respectively. The case studies used are of Glasgow! and West 2 Dunbartonshire . The thesis concludes that existing approaches to regulation are conducted in separate regulatory domains without sufficient comprehension of the impacts of action in one regulatory domain on another. It also concludes that the instruments used in the assessment of the impacts of regulation on taxi supply are insufficiently specified and inadequately coordinated. It is possible to identify issues across regulatory domains that can be improved to better optimize supply appropriate in any given circumstance to the benefit of existing and potential passengers - this includes those with particular access needs. In optimizing supply, awareness of the needs of the taxi industry and its regulators 1 Although central to the Strathclyde conurbation, the Glasgow licensing area relates to the central city area only (Clydebank, Paisley, etc. being included in separate council licensing areas). The city is thus defined as medium sized location. 2 Further focus city material bas been collected from Belfast and Edinburgh, which is included in comparison within the text, and summarised in the appendices of this document. 6 James Cooper Taxi Licensing, Regulation and Control has been an important element of consideration. The thesis makes recommendations for alterations in the application of standard methods of assessment of taxi supply. 7 James Cooper Taxi Licensing, Regulation and Control Table of Contents Chapter 1: Introduction, the development of regulatory models applicable to urban taxi supply 1.1 The role of taxis in an urban setting 16 1.2 Defining a taxi service 19 1.3 Competition and transport delivery 22 1.4 Taxi service delivery 24 1.5 History of taxi supply 25 1.6 Outline of thesis 28 Chapter 2: Taxi Regulation: literature review 2.1 Introduction: objectives of the chapter 30 2.1.1 Historical perspective on taxi supply and regulation 32 2.1.2 Nighttime and daytime: differentiated economies 33 2.2 Regulatory Economics 35 2.2.1 Market failure 37 2.3 Regulation in the transport sector: setting the context for taxi 39 serVIces 2.4 Regulation in the taxi sector and the identification of issues 40 specific to the taxi mode 2.4.1 Quality regulation 43 2.4.2 Quantity regulation 45 2.4.3 Economic regulation 47 2.4.4 Critical appraisal of the literature 48 2.5 Methodological literature 49 2.6 Models and analysis pertinent to taxi regulation: assessment types 50 and practices 2.6.1 Impacts of individual assessment 51 2.6.2 Current definition and use of the Significant Unmet Demand 51 (SUD) Model 2.6.3 Cost Models 52 2.6.4 Inclusion of quality controls in taxi models 53 2.7 Conclusion 53 Chapter 3: Methodology 3.1 Introduction 55 3.2 State of the practice, building from existing study methods 57 3.3 Choice of methodology 58 3.4 Developing a mixed methods approach 63 3.5 Critique of the methods used 63 3.5.1 Literature review 67 3.5.2 Stakeholder analysis 68 3.5.3 Surveys of local authorities 69 3.5.4 Supply analysis 71 8 James Cooper Taxi Licensing, Regulation and Control 3.5.5 Demand analysis 73 3.5.6 Case studies 74 3.6 Survey Detail 75 3.6.1 Primary research: Stakeholder Questionnaire 79 3.6.2 Supply analysis 82 3.6.3 Demand analysis 86 3.6.4 Case Study 89 3.7 Enhancement to existing approach and critique 90 3.7.1 Temporal differences and data consistency 91 3.8 Conclusion 91 Chapter 4: The different domains of taxi regulation 4.1 Introduction 94 4.2 Quantity, quality and economic controls applied to taxis: an 94 appraisal 4.2.1 National and regional control 95 4.3 The structure of urban taxi markets 98 4.3.1 Temporal markets 99 4.3.2 Daytime policy imperatives 100 4.3.3 Definition and response to day/night supply issues 102 4.3.4 Spatial relationships 103 4.4 Empirical evidence 104 4.4.1 Nature of interactions 104 4.4.2 Nighttime transport interactions 105 4.4.3 Daytime transport interactions 107 4.4.4 User needs 108 4.5 Gaps in delivery 108 4.5.1 Models used in the determination of regulatory form 109 4.5.2 Factors in market development 111 4.6 Conclusion 112 Chapter 5: Regulatory models, a detailed analysis 5.1 Introduction 114 5.2 Defining regulatory models 114 5.2.1 Balance and impacts between regulatory domains 117 5.3 Forms of regulatory models 117 5.3.1 Quality control 118 5.3.2 Linkages between quality control and analytical models 120 5.3.3 Quantity restriction 120 5.3.4 Linkages between quantity restrictions and analytical models 121 5.3.5 Economic regulation 122 5.3.6 Development of analytical cost models 123 5.4 Conclusion 124 Chapter 6: An evaluation of existing practices 9 James Cooper Taxi Licensing. Regulation and Control 6.1 Introduction 126 6.2 Case studies exampling key issues in taxi supply 127 6.2.1 Structured interviews 130 6.2.2 Key issues arising in the focus cities 130 6.2.3 Issues specific to licensing 133 6.2.4 Issues specific to tariff 134 6.3 Experiences in applying current assessment 135 6.3.1 Critique of modelling practice, assumptions in SUD modelling 136 6.3.1.1 Driver waiting conflicts 141 6.3.1.2 Fleet composition models 141 6.3.2 Critique of cost model components 142 6.3.2.1 Driver wage conflicts 142 6.3.2.2 Impacts of changing fleet sizes 145 6.3.3 Quality control application 147 6.3.3.1 Minimum standard and maximum age requirement 148 6.3.3.2 Disability access impacts 149 6.4 Potential for updating model components and interaction 150 6.5 Conclusion 151 Chapter 7: Construction of a new model 7.1 Introduction 153 7.2 Technical specification 153 7.2.1 Quantity analysis 155 7.3 Nature of relationships 156 7.4 Development of the new model 158 7.5 Technical detail of model elements 158 7.5.1 Development from quantity models 159 7.5.1.1 Threshold of delay 161 7.5.1.2 Passenger delay 164 7.5.1.3 Vehicle delay model 165 7.5.1.4 Fleet impact sub model 166 7.5.2 Non-licence based solutions model 169 7.5.2.1 Stance engineering 170 7.5.2.2 Driver perception model 172 7.5.2.3 Time savings at stance model 172 7.5.2.4 Engineering calculation 174 7.5.3 Accessible vehicle model 176 7.5.3.1 Model of proportional demand 177 7.5.4 Linkages between quantity and other regulatory domains 180 7.6 Developing a new model of economic regulation 182 7.6.1 Taxi cost model 184 7.6.1.1 Vehicle purchase cost 184 7.6.1.2 Vehicle cost, depreciation 185 7.6.1.3 Cost of vehicle maintenance and labour 187 7.6.1.4 Maintenance cost, labour 188 7.6.1.5 Fuel cost 189 7.6.2 Infrastructure cost model 190 7.6.2.1 Insurance costs 191 7.6.2.2 License costs 191 10 James Cooper

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