The government has rejected calls from MPs to fast track reform of the law governing taxis and private hire vehicles.

The transport select committee called in July for "urgent and wholesale reform" as well as new legislation to tackle cross-border hire, suggesting that ministers should use the legislative reform order route to achieve this.

But the goverment last week reaffirmed its commitment to handing the project over to the Law Commission.

The response from ministers said: “The government has indicated that it wants the review to be underpinned by a deregulatory objective commensurate with maintaining satisfactory levels of safety. Beyond that, the Law Commission has been charged with carrying out a root and branch review with a view to providing recommendations and drawing up a draft Bill.”

Ruling out the legislative reform order route, ministers said that while it expected the draft Bill produced by the Law Commission to have a good degree of support, there would be substantive and controversial issues to be addressed. It would be best if these issues were considered and debated during the passage of the Bill through Parliament, the government said.

The response also said:

• A sensible and desirable outcome from the review would be a single Act of Parliament covering both taxis and PHVs
• The Department for Transport will not intervene in the way local authorities review their progress against local transport plans or require reports or review. “While local authorities had a statutory duty to produce LTPs by April 2011 it will be for them to decide how to implement and use them”
• Ministers agreed in principle with national standards in relation to issues which directly relate to public safety, such as the level of CRB check drivers require, the roadworthiness of vehicles and drivers whose licences have been revoked being licensed shortly afterward by a different district
• Local authorities seemed well-placed to deal with this form of transport. “They have a good deal of experience and expertise in administering the licensing function and a continuing role for them would obviate the need to establish a new licensing system. However, the government does not want to pre-empt the Law Commission’s fundamental review of the legislation, and would be willing to consider the case for an alternative approach”
• Ministers agreed that the Law Commission should review any legal barriers to co-operation between local authorities and innovation in organising and funding enforcement activity. “There would seem to be advantages in enabling local licensing authorities to collaborate over enforcement funding and activity”
• There is merit in considering whether certain low-level offences relating to taxis and PHVs could be appropriately dealt with by fixed penalty notices
• The government in principle accepted the MPs’ recommendation that existing licensing districts should be permitted to be combined where local authorities decide it is best to do so. However, the Law Commission would have to consider the details of  how this would work.

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Ministers also said they understood the concerns about cross-border hire problems. But they said they were “not convinced” by a recommendation from the select committee that it should be permissible for taxi and PHV licences to include a condition that the vehicle must principally be operated in the licensing district.

The response gave a number of reasons for this, including that it “did not seat neatly with a deregulatory approach to reforming taxi and PHV legislation”. It also suggested that on a practical level, it would involve local authorities establishing a new tier of enforcement activity.

The government said it did not want to fetter the Law Commission’s discretion, but did suggest one alternative approach of obliging licensed operators to use only vehicles licensed by the same local authority as granted their operator licence.

Ministers also rejected the MPs’ recommendation that local authorities be: permitted to issue fixed penalty notices to out-of-town drivers where there is evidence, for example, that they have worked or sought to work for a specified period of that time in that district; and allowed to prosecute operators in other districts which are routinely sending cars to work in their area.

The Law Commission agreed to include the reform project in its 11th programme of law reform, which started in July 2011.

Philip Hoult