Taxi fares increase for second time this year due to fuel price

The rise, the second made during the year, comes into force today.

The maximum fare was increased by 3.34% at the beginning of this year to cover the preceding two-year period.

Another increase was not due to be considered until the end of 2022.

The Taxi Federation met recently with members of Environment & Infrastructure and Policy & Resources to say it was struggling to cope with very significant increases in fuel costs.

Following two challenging trading years because of the pandemic, taxi operators are now being impacted, particularly by fuel costs, but unlike many other sectors, regulations mean they are not able to freely adjust their prices to reflect changes to their running costs.

The January increase did not reflect how much fuel costs rose in the past nine months, with the price of diesel rising by 23%. This extraordinary rise led to E&I proposing and then, after consultation, approving the increase.

Taxi fare increases are calculated using the established ‘Halcrow Formula’, and that same formula has been used to determine the level of this interim increase of 5.35%

This increase is a standalone measure and separate to the review of the taxi industry which is under way, looking at various aspects of how operators are licensed.

The committee will consider those findings to determine what other, longer-term changes should be taken forward.

Fuel prices have risen from about £1.40 a litre for petrol and £1.43 a litre for diesel at the start of this year, to about £1.65 for unleaded and £1.72 for diesel.