chris-powell

The government’s long-awaited 'Traffic Commissioner function review 2021/22' has finally been published.

With Traffic Commissioners responsible for licensing and regulating operators of HGVs, PSVs and local bus services, any company operating either goods vehicles or buses will be affected by the review and its recommendations. If they’re adopted, they’ll amount to the single greatest change to the transport regulatory regime this century.

What are the key takeaways?

Traffic Commissioners are still very much required

In August 2021, the DfT launched a consultation on the future of the Traffic Commissioner function. All options were on the table, including whether Traffic Commissioners were even required at all.

To this point, the review is clear: they are. And this should come as no surprise. The document notes the volume of both freight traffic and bus journeys in the UK, and the resulting "significant public interest in ensuring [these] industries are well regulated".

This is hard to argue with. One only needs to compare UK road safety statistics with those of other jurisdictions with less-robustly regulated transport industries for the benefit of our current system to become clear.

Individual Traffic Commissioners to be replaced by a single tribunal

This does not, however, mean business as usual going forward. The Review recognises that the current model as it stands is outdated and in need of reform, noting that its organisational structure holds "no exact equivalence across government, representing a significant divergence from centrally produced guidance and…best practice".

The solution, it says, is to create a single specialist tribunal, to be led by a tribunal president, rather than a senior Traffic Commissioner.

The practical effect of this would be to give the Traffic Commissioners far greater powers over how their public inquiries and regulatory proceedings would be run. There would be the introduction of tribunal rules and the power to make costs orders against frivolous applicants and those operators who fail to comply with the directions of the tribunal.

Such changes would bring the Traffic Commissioner function much more closely into line with other equivalent licensing tribunals. It also raises the prospect of the new Tribunal having greater ‘teeth’ to take action against operators who fall short of the high standards expected.

Higher fees for larger operators

On the question of fees, the review is again straight-talking, describing the current structure as "flawed".

The fixed fee per licence model receives particular criticism. Under the present system an operator spends £257 to apply for a licence, £401 at the point of issue, and a further £401 once every five years to continue the licence. This is the same fee whether an operator runs one or 1,000 vehicles.

Aside from obvious arguments over fairness, there is a more pressing need to consider a reform to the current fee structure: in 2020/21 the licensing service income was just over £13m, whereas expenditure over the same period was almost £18m. The proposal is that this deficit is paid for by the industry, including through the introduction of graduated fees.

Whilst it would take changes to primary legislation to implement these fee reforms, it is not hard to see how the DfT might decide to take this forward as a priority, if for no other reason than to balance the books. If so, this would certainly mean increased costs coming down the line for larger fleet operators.

A new blueprint for the future?

This is not the first review to recommend reform to the Traffic Commissioner function. Previous recommendations have either not been taken up or have been watered down so much that they have amounted to no more than tinkering around the edges. With the need for primary legislation change, a general election on the horizon and limited parliamentary time available, it remains to be seen how many of these latest recommendations will become reality.

If there is to be prioritisation, it seems likely that the DfT will want to focus on licence fee reform. This may well be seen as the magic bullet that would address many of the other problem areas with the current system and result in a cost-neutral regulatory regime funded in an equitable way by the industry that it supports.

We’ll all be following closely.

Chris Powell, principal associate and road transport regulatory specialist, Weightmans