Today the TFL have declared that they would strip Uber’s licence to operate in the capital. This decision is not only detrimental for Uber and the company’s 40,000 drivers, who will miss out on Uber’s most profitable city, but also to the three-and-a-half million people who use Uber across the 32 boroughs of London. Instead, the TfL, have opted to damage consumers by facilitating a monopoly on the London market of the older and more established taxi service, that costs substantially more than the service Uber had offered.
The decision taken by TfL, that was supported by the incumbent London Mayor, Sadiq Khan. The mayor claimed that “keeping Londoners safe is my absolute number-one priority, and TfL have identified a pattern of failure by Uber that has directly put passengers’ safety at risk.” However, it appears that the lobbyists representing the taxi industry and the fear of Uber undercutting the subsection of the transport sector may too have swayed the decision taken this morning.
The head of Uber in the UK, Jamie Heywood, refuted the accusation proposed by TfL and Khan that Uber lacks safety regulation, by explaining that of the 43 incidences that the TfL’s case depended on, just two were non-licenced drivers. Perhaps, more importantly, Uber clamped down on those manipulating the system through stopping them taking trips, technical fixes and a complete audit of all drivers’ documentation. As such it is potentially dubious that TfL sought to terminate Uber’s licence even when the company accommodated for the suggestions put forward by the central government.
The black cab workers saw Uber as a direct threat to their work, and it was, but there were undoubtedly claims among consumers in the capital, that Uber was beneficial to people throughout London. Previously, the Unite union urged that Uber and the free-market was harmful to the 126,000 cabbies. There is undoubtedly an argument for this as black cab private hire licences have stagnated since Uber began to operate in the capital at around 20,000 per annum. Whereas, private hire licences have soared from 60,000 in 2012, to 120,000 in 2017. Since TfL’s first attack against Uber two years ago, there has been a relative decline, but the industry remains more substantial than the black cab sector.
Unlike Unite, the CBI is far more supportive of Uber and hopes that the TfL can accommodate for the business over the coming weeks when Uber is expected to file an appeal. Uber is safe, cheap and a great alternative. CBI claimed that Uber is excellent value. The support from the CBI mirrors not only concerns by the public but also other economists. Kate Andrews, of The Spectator, described the decision as ‘pointless protectionism’, because of how Uber had evolved since 2017 to fit within the regulations established. For many Londoners and Britons in other cities that use Uber, the company provide a cheap, easily accessible, and reasonable services. In the aftermath, of the original ruling in 2017, The Evening Standard carried out a poll that found that just 25% of Londoners were supportive of the protectionist policies. Even among those who drive for Uber, polls around the same time found that 80% were satisfied with their terms of working. The choice is something that consumers should have access to. According to Finder, the average cost of an Uber per mile is £1.28, whereas, by comparison, a taxi, over the same distance costs approximately £5.97.
Moreover, while Britain has one of the cheapest Uber services, it also has the most expensive taxi service in the world. A prime example is in my hometown of Chelmsford, where my 7-minute taxi journey home from the train station costs £15. However, in the city of Nottingham, a journey that takes an equal amount of time, around the same time of night, from the Queen’s Medical Centre to the University Campus costs a meagre and fair £3.81. However, there are more positives to Uber than just the value for money. Uber provides a service in often comfortable cars, and the service is extremely fast. It only takes one click to book an Uber and having pre-set the destination, via the app, drivers are in no doubt on where they need to go to. With this in mind, rather than adding shackles to Uber to prevent their competitiveness, we should encourage them with permits across the country to incentivise competition and benefit the consumer.
Unfortunately, it appears that TfL and Sadiq Khan have worked to please the unions and cabbies, who have brought London to a standstill on several occasions this year. Perhaps, they should instead accept that monopolisation is inherently harmful to the consumer in the capital and providing Londoners with the freedom to choose between cabs and Uber’s will ensure that prices and conditions will reflect what the people want.
By J Walters