MPs urge action on "signficant" legal loophole in taxi licensing

MPs have called on the Government to address a “damaging and significant legal loophole” that allows taxis licensed by other local authorities to operate within Rotherham, even if the drivers have had their application for a Rotherham licence rejected.

The call from the Communities and Local Government Committee was made in a report into the Government’s interventions in Rotherham and Tower Hamlets.

The CLG committee said: “In Rotherham, this [loophole] means drivers are operating in the borough without meeting the council's recently-imposed requirement for taxis to be fitted with CCTV, for example.”

The MPs urged the Department for Communities and Local Government, the Home Office and the Department for Transport to introduce statutory guidance “without delay” to ensure consistently high standards in taxi licensing across the country and enable local authorities to put in place and enforce specific measures which are appropriate for their circumstances.

“If guidance is not able to achieve this, the Government should consider legislation,” the committee said.

The report on the imposition of commissioners in Tower Hamlets and Rotherham said lessons should be learned by the Government and local authorities to ensure that children are protected, whistleblowers are taken seriously and scrutiny arrangements are robust.

The committee said:

• The DCLG must look at what worked and what could have been improved in these cases “to ensure any future interventions are swift, effective, clear in their aims and transparent”. The DCLG must also work with the Local Government Association and local authorities in learning lessons about how to monitor and mitigate the risks of the sort of failings seen in the two areas with the aim of avoiding the need for interventions elsewhere.
• It was surprised to hear that neither the Government nor any local authorities had contacted Rotherham’s council leader, Chris Read, to ask how the borough was responding to the Jay report recommendations.
• Local authorities needed to encourage and support those who came forward and to investigate their concerns. The Government must “take necessary legislative action to ensure whistleblowers who approach commissioners have legal protection”.
• Interventions should “press upon local authorities the need to ensure that proper checks and balances and scrutiny arrangements are in place to drive a culture of transparency and continuous improvement”. Tower Hamlets was identified by MPs as having had a particular problem; the committee recommended other councils learn from its progress on these issues.

In the report, which can be found here, the CLG committee also said that:

• Intervention by Government must be proportionate to the local authority's failings;
• When appointing a commissioner, consideration should be given to the value they place on local democracy, and the local authority and LGA should be consulted;
• The DCLG should report at the end of each intervention and include the lessons learned or best practice to be shared;
• Local authorities in receipt of interventions should be responsible for bearing the costs, which should be made public;
• Commissioners should seek to mirror normal scrutiny arrangements within a local authority as far as appropriate;
• The DCLG should consider additional oversight measures for councils exiting from interventions, such as the phased withdrawal of commissioners, assurances from external auditors or monitoring by other councils, for example.

Clive Betts MP, Chair of the CLG Committee, said: "It is widely agreed that the interventions in Tower Hamlets and Rotherham were justified because both local authorities had significantly failed to meet their responsibilities with regards to high standards of service, governance and democratic accountability.

“The aim in both cases is the return to normal democratic arrangements, but if the interventions are ultimately to be effective, then they must result in sustainable improvements, which in the view of the committee can only be achieved through changes in their organisational culture.”

Betts added: “The Department for Communities and Local Government must carefully examine what worked and what could have been done better with these interventions so that the process can be improved for possible future cases.

“It is also vital that the failings in Rotherham and Tower Hamlets and the work done to address them are identified and shared so that similar issues can be addressed in other local authorities at an early stage to avoid them hitting rock bottom and having commissioners imposed upon them. The DCLG and LGA clearly have important role to play in this, but local authorities must also take responsibility themselves for seeking out and sharing this best practice."