Targeted Support and Tax Grabs: ASI Responds to the Chancellor's Announcement on Cost of Living Relief Measures

In response to the Chancellor’s Statement on the Cost of Living, Morgan Schondelmeier, Director of Operations at the Adam Smith Institute, said:

We welcome the Government’s introduction of targeted support for households, a policy which the Adam Smith Institute called for in a recent report. 

A one off cash payment direct to the most vulnerable households is the clearest way to provide immediate support with the least distortionary effects. Uprating benefits in line with CPI is also a sensible measure to ensure the least well off don’t get left behind. Finally, the Chancellor is right to scrap the repayments on the energy bills rebate - a poorly designed scheme from the start. It’s just a shame that it took the Chancellor so long to come to these conclusions.

A conclusion the Chancellor never should have reached was that a windfall tax is a good idea. Spending months arguing against it both practically and ideologically and then caving to pressure from the left leaves much to be desired for a ‘fiscally conservative’ Chancellor. Even with the sensible sunset clause and investment measures, a windfall tax is still not the most effective way to raise revenue and sets a precedent that the UK is a risky place to do business. 

Notes to editors:  

For further comments or to arrange an interview, contact Emily Fielder, emily@adamsmith.org | 0758 477 8207.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

More of the same? ASI comments on the 2022 Queen's Speech

Commenting on the 2022 Queen’s Speech, Head of Communications Emily Fielder said:

Despite pledging to drive “growth and strengthen the economy and ease the cost of living crisis,” the Queen’s Speech announced a raft of meddling pet projects, rather than focusing on measures that can deliver meaningful change. The only growth the Government is achieving is the growth of the state.

It’s one thing to recognise that Britain desperately needs growth—it’s quite another to actually deliver it. Unfortunately, a hodge-podge list of interventions on everything from regulating football to cracking down on protests does not constitute a comprehensive government strategy. Rather than outlining a credible plan to meet its stated objectives, the Government is making more promises it doesn’t seem prepared to keep.

What was undeniably missing from the speech was immediate solutions to the cost of living crisis. No promises have been made to put pounds in the pockets of those struggling the most whilst the Government are too busy cracking down on free speech online.

Our country needs bold new ideas to pull us out of the doldrums, but this Queen’s Speech merely offers more of the same.

Notes to editors:  

For further comments or to arrange an interview, contact Emily Fielder, emily@adamsmith.org | 0758 477 8207.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Put the UK’s Taxi Laws in for an MOT and the Consumer Back in the Driving Seat

Abolish the Knowledge, support Paratransit Light Vehicles and remove barriers for market entrants to get the UK moving, says think tank

• The UK’s licensure regime is inherently exclusionary due to its expensive and overly complicated nature.

• Current TFL guidance for the licensure of taxis is 105 pages long, whilst James Button’s encyclopaedia of the UK’s current taxi regulations comes to almost 3000 pages. 

• The cost of a taxi licence in London can exceed £10,000 after the ‘Knowledge’ test is taken into account.

• Data from End Violence Against Women shows that 1 in 2 women feel unsafe walking near their home at night, and 1 in 2 women feel unsafe walking in a public area at night. Improving access to cheap and safe late-night transport would help to address these concerns. 

A new report, A Fare Shake: Reforming Taxis for the 21st Century, from the Adam Smith Institute (ASI) argues that the Government should move to overhaul current taxi cab legislation, creating a more dynamic and equitable sector to better serve the needs of Britons as they get moving after Covid. Drivers and operators should have a clearer, more liberal licensing system, giving users unprecedented choice at lower costs, better safety, and higher quality. 

Report author, Maxwell Marlow, makes the economic case for streamlining licensure rules. Taxis, PHVs (Private Hire Vehicles) and ride-source suppliers are critical to rebuilding the economy after the pandemic. Personnel Today has found that 40% of people want to use PHVs for their work commute, whilst the hospitality and night-time sectors will benefit from greater consumption of goods and services consumed either side of the rides. Moreover, in London, only 46% of households own a car meaning that, especially for lower income groups who are less likely to own one, travel is increasingly reliant on third-parties. Freedom of travel should be protected for lower-income households, who are at the mercy of restrictive transport regulation and declining TfL services. 

The paper also highlights the need to end the preferential treatment of taxis, which is currently taking place at the expense of PHVs and ride-source providers. PHVs provide a great deal of societal inclusivity for disabled people, who are often excluded from public transport and conventional vehicles, whilst ride-sourcing platforms are the most popular mode of hired transport services, offering rapid and reliable transport across urban areas. 

The report recommends the following policies:

1. Eliminate wasteful duplication and regressive licensing by creating a single, standard licensing regime, enforced by a national licencing authority. 

2. Abolish the ‘Knowledge’ advanced topographical tests, which have become unnecessary due to the advent of reliable GPS and digital maps. 

3. Permit PHVs to be hailed from the pavement and allow all licenced point-to-point operators to use bus lanes in order to make transport fairer. 

4. Support more Paratransit Light Vehicles. These are higher capacity vehicles which run regular services along high-demand routes and which can be summoned by a customer. 

5. Allow drivers nationwide to claim the cost of passenger-facing CCTV back against tax and encourage the use of online safety kits to improve standards of safety.

6. Offer incentives for taxi and PHV drivers to switch to green vehicles through offering discounts on green vehicles, and raising capital through a Green Taxis and PHVs Fund to subsidise faster transition away from combustion engines. 

Maxwell Marlow, report author and Development and Research Officer at the Adam Smith Institute said: 

“Britain operates critical services on last millennium’s laws. It’s time to put the brakes on special interests, who inflate costs and gate-keep with the antiquated and defunct ‘Knowledge’, and give consumers more choice. We need to simplify our licensing system, making it more fair and transparent, whilst ensuring that our fleets are greener, safer, and more efficient than before. The report contains a myriad of policies to give Britons the freedom to travel that they deserve, turbocharge the economy and relieve the cost-of-living crisis for many along the way.”

Greg Smith, Member of Parliament for Buckingham and Transport Select Committee Member, said:

“Reform of the taxi and PHV market is long overdue.  The revolution in consumer choice that services like Uber brought needs to be matched with the way the State sees taxi services, and I welcome the ASI’s recommendations in this regard.  We need to embrace deregulation for better and cheaper choices for all.”

-ENDS- 

Notes to editors:  

For further comments or to arrange an interview, contact Emily Fielder, emily@adamsmith.org | 0758 477 8207.

Maxwell Marlow is a Development and Research Officer at the Adam Smith Institute, an MA candidate at the LSE, and a Don Lavoie Fellow at the Mercatus Center, George Mason University. 

The report is now live on the Adam Smith Institute website here.