1. Why are we reviewing taxi fares and tariffs?

We normally review taxi fares and tariffs annually and aim to implement changes in April of each year. Taxi fares and tariffs were last updated by TfL in April 2023.

There are several stages involved in the annual review of taxi fares and tariffs. These include updating the Cost Index, carrying out a public consultation and reviewing the consultation responses, and considering recommendations and potential changes. This is why the consultation starts well in advance of any potential changes coming into effect.

When we review taxi fares and tariffs we try to strike an appropriate balance between drivers being fairly paid and taxi users getting fair and affordable fares.

We are now reviewing taxi fares and tariffs and considering changes because:

• The Cost Index, which is used to track changes to taxi drivers’ operating costs and average national earnings, shows:
  1. There has been an increase in taxi drivers’ operating costs
  2. There has been an increase in average national earnings
• We recognise that some taxi drivers may be under greater financial pressure at the moment and are affected by the cost of living crisis and increases in other items (e.g. utility bills, mortgages, food costs, etc)

It is important that taxi drivers are fairly paid to ensure that:

• Taxi drivers can cover their operating costs and are fairly compensated for their work
• Taxi driving remains a viable career to encourage licensed drivers to remain in the trade and to encourage new applicants. If the number of licensed taxi drivers or new applicants continues to fall then this could impact the service for passengers in terms of safety, availability and reliability. For example:
  1. Some people may not be able to make a journey and those who rely on taxis, e.g. people with disabilities, will be disproportionately affected
  2. There may be longer wait times for taxis which could impact safety and convenience for passengers, particularly late at night
  3. Some people may choose or be targeted by a less safe option (e.g. using an unlicensed vehicle or unbooked private hire vehicle (PHV))

It is important that taxis remain affordable because:

• Taxis may be particularly important for some people who require an accessible vehicle
• Taxis may be particularly important for some people who require a door-to-door service
• Taxis provide an important service late at night and if taxis are considered too expensive people may be more likely to use an unlicensed vehicle or unbooked PHV
• If taxis are considered unaffordable, and the number of people using taxis or taxi journeys declines, this could reduce the availability of taxis or increase taxi wait times, as existing taxi drivers may choose to change jobs and people may be deterred from applying to become a taxi driver