The 1985 Transport Act required all district councils in England and Wales outside London to license taxis and to be satisfied that there was no significant unmet demand for taxis before refusing applications for further licences. In 1989 all except one of the 364 districts licensed taxis and 323 of them chose also to license private hire vehicles, with more councils intending to do so during 1989. There were 27777 licensed taxis in 1989. The increase from 1985 to 1989 in the districts which licensed throughout was 37 per cent. Licensed private hire cars totalled 45979; it is estimated that there were up to 2000 vehicles operating in districts which did not license. Surveys to measure unmet demand for taxis were undertaken by 136 districts. The results in most areas suggested few or no extra taxis were needed. Nevertheless the ratio of taxis to private hire vehicles in the 211 districts which limited the number of taxis was lower than in deregulated districts. In addition the districts which limited the number of taxis were more likely to have experienced growth by the private hire car sector which cannot be restricted in number. These findings suggest regulation suppresses the number of taxis but no necessarily the number of vehicles providing taxi and private hire car services. (A)

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