Scrapping a cap on taxi and private hire cabs could see big firms like Uber “flood the market” and hit drivers’ earnings, a trade body has warned.
Business leaders want Glasgow to remove a limit on vehicle numbers to boost the night-time economy, as they say it is keeping people away from the city centre.
Ride-hailing app Uber also wants the overprovision policy to be removed, claiming the move would give drivers new earning opportunities and provide “greater transport options” to passengers.
But their views are at odds with the Scottish Private Hire Association (SPHA), which believes an oversaturated market will lead to drivers “being forced to work more and more hours” to make a living, raising safety concerns.
Glasgow’s licensing committee — which rejected over 680 bids for private hire car licences from May to the end of 2024 due to the 3,450 vehicle limit being reached — agreed today (Wednesday, January 15) to hold a consultation on the policy.
Committee chairman, Cllr Alex Wilson, SNP, told the Local Democracy Reporting Service (LDRS) he would be “reluctant” to remove the limit but any decision will be based on the consultation’s findings. Councillors could choose to raise the cap, allowing more cars to operate in the city.
Cllr Wilson said feedback from the trade has suggested there are currently enough cars, but drivers are choosing not to work at peak times.
He believes firms should incentivise their drivers to work at these times, which include weekend evenings, adding: “I think the cap has worked well and it is keeping the market competitive.”
The policy was last reviewed in 2023, when the committee agreed to make 255 more private hire car licences available to address demand at busy times.
A review had found “unmet demand” for taxis and some evidence of “potential underprovision of private hire cars”, particularly at peak times. It added the “primary issue is a lack of drivers rather than a lack of vehicles”, but the change “may assist in increasing the number of drivers entering the trade”.
However, recent reports by market research agency Progressive Partnership and Glasgow Caledonian University Moffat Centre, commissioned by the council, indicated “the late night city centre economy continues to face a number of post-covid challenges”.
They highlighted issues “relating to a lack of late-night transport options including the availability of taxi and private hire cars acting as a deterrent to people coming in the city centre area later in the evening”, a council report states.
Stuart Patrick, chief executive of Glasgow’s chamber of commerce, said the city centre is the “heartbeat” of the city’s economy, but it is still facing significant challenges in recovering from the pandemic”.
He added: “A vibrant night-time economy is crucial to this recovery and ensuring that people can travel to and from the city centre easily and safely is key to its success.
“Our research shows the availability of taxis and private hire cars is a significant factor, particularly at peak times. Glasgow is the only city in the UK to operate a cap on private hire cars and this is limiting the options of late-night visitors to get home.
“This is not just an inconvenience but is actively deterring people from coming to town, which is something we cannot afford if we want to see growth and vitality return to our city centre.”
A spokesman for Uber said scrapping the cap would “support local businesses, in particular in the night-time economy in which many businesses have highlighted the unmet demand for more taxis”.
He added: “All drivers will have access to industry leading worker rights such as holiday pay and a pension, as well as formal representation through the GMB union. More passengers will be able to count on a safe trip through a range of industry-leading safety features.”
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But Eddie Grice, general secretary of the SPHA, said a “supermajority” of his members support the cap. “Massive firms, like Uber, would flood the market if we didn’t have this policy in place,” he added.
“Without the cap, driver earnings would plummet at a time where costs are ever increasing. This would inevitably lead to drivers being forced to work more and more hours on the road which in turn gives rise to public safety concerns.
“The cost of adding more and more cars to the fleet, the cost of increasing efficiency metrics in that context, is an oversaturated workforce struggling to make ends meet.”
A public consultation was proposed after a meeting between Cllr Wilson and Cllr Angus Millar, SNP, the council convener for city centre recovery, who regularly meets with leaders in Glasgow’s night-time economy.
It will seek views from the trade, hospitality firms and the public on whether a cap is still necessary. There are currently 1,238 taxi licences, which are limited to 1,420, and 3,450 private hire car licences.
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