Section 3: zoning within one licensing authority
7.24 In around
five per cent of LAs the licensing area is divided into two or more zones.
These zones exist as a result of various local government reorganisations. If a
new authority comprised part of two or more postreorganisation districts then
each of those constituent parts constituted a zone for the purposes of taxi
licensing. The LA can overcome this by seeking Secretary of State approval for
an extension resolution under the Local Government Act 1972 but the only action
that an LA can take is to remove all zones or accept the situation as it is.
LAs do not have the power to create zones or to merge individual zones - unless
merging zones has the effect of removing all zones.
7.25
Since
these zones are licensing districts in their own right, they increase the
number of cross border problems and again restrict supply from better meeting
demand. Some authorities have argued that the removal of zones would mean that
drivers would concentrate on those, primarily urban, areas where they can make
most profit to the detriment of the, primarily rural, areas where demand is
lower. This argument, given an absence of quantity control, does not stand up.
Demand in rural areas is unlikely to reduce because zones are removed and if
taxis found it was profitable to serve a particular area with zoning, it will
be profitable afterwards. If some taxis did migrate to urban areas then others
would take their place.
7.26
Under
current legislation LAs are permitted to remove all licensing zones with
approval of the Secretary of State for Transport. This regulation is due to be
amended by an RRO which will enable LAs to amalgamate licensing zones without
seeking approval from the Secretary of State.135
7.27
We
note the intention of the DfT to remove the legislative requirement for LAs to
seek permission from the Secretary of State before amalgamating licensing
zones. We think that LAs will bring greater clarity to the market if they
remove zoning within their districts.
'135 Cabinet Office: Regulatory Reform. The Government's Action Plan 2002.
78 The regulation of licensed taxi I November 2003
and
PHV services in the UK