Source: https://oag.parliament.nz/2005/taxis/part4.htm
Timestamp: 2020-07-10 04:12:37
Document Index: 319465135

Matched Legal Cases: ['art 4', 'art 4', 'art4', 'art 5', 'art 7', 'art 3', 'art 7', 'art 7', 'art 5']

Part 4: The Authority’s monitoring and enforcing compliance of the taxi industry — Office of the Auditor-General New Zealand
Part 4: The Authority’s monitoring and enforcing compliance of the taxi industry Effectiveness of controls over the taxi industry. https://oag.parliament.nz/2005/taxis/part4.htm https://oag.parliament.nz/@@site-logo/logo.png
In this Part, we discuss the Authority’s monitoring and enforcing of the taxi industry’s compliance with legislation.
As we did for the entry controls for the taxi industry, we prepared expectations in relation to monitoring and enforcing compliance, and then assessed the Authority’s performance against the expectations. We looked at:
the Authority’s approach to monitoring;
monitoring of taxi organisations, passenger service licence holders, taxi drivers, and course providers;
the Authority’s monitoring intentions; and
enforcing the taxi industry’s compliance.
In its Statement of Intent 2004/2005, one of the Authority’s functions is the maintenance and preservation of records and documents about activities within the land transport system. Accordingly, we expected that, in fulfilling this function, the Authority would hold detailed information about all the vehicles and drivers in the taxi industry.
We expected the Authority to monitor the performance of the providers of passenger endorsement and area knowledge courses, and the provider of the Certificate of Knowledge of Law and Practice examination.
We expected the Authority and the Police to work closely together, to ensure that the Authority was notified of any taxi drivers who had been charged or convicted of serious offences. Our 1997 report concluded that the Authority “needs to reach an agreement with the Police to automatically notify [the Authority] every time a passenger service driver is charged with a serious offence”. The Authority agreed to our conclusion. We also expected the Authority to have a means of ensuring that all taxi drivers held valid passenger endorsements, or to be notified when they did not, so the Authority could check that the driver had ceased operating.
We expected the Authority to have dealt with, through appropriate enforcement action, taxi organisations, passenger service licence holders, and taxi drivers who had breached the terms of their licence or endorsement, or had been charged with, or convicted of, a serious offence. We expected to see an improvement in the situation described in our 1997 report that “some [Authority] regions are not able to provide effective enforcement of legislative requirements which are intended to ensure that taxi drivers operate in a safe way.”
The Authority’s approach to monitoring
During discussions with staff at the Authority’s National Office, it became clear that, in their view, the Authority has limited responsibility for monitoring compliance in the taxi industry. The Authority takes the position that individual drivers and taxi organisations are responsible for their own compliance with legislation.
In our view, the Authority has responsibility for monitoring the taxi industry according to its legislative purpose and the specific powers it has been given by Parliament in the Land Transport Act 1998, the Transport Services Licensing Act 1989, and subordinate legislation.
While it is the responsibility of those in the industry to meet their obligations, the Authority must be able to determine whether obligations for operating in the land transport system are met. In order to maintain effective oversight of the industry, it is essential for the Authority to collect and analyse data, to gain information that can be used to target non-compliant operators.
There is no single record of a driver’s passenger endorsement, driver identification card, passenger service licence number, or vehicle number. These pieces of information are held in a number of places, including the Driver Licence Register, Motor Vehicle Register, and individual regional office files (especially information on monitoring activity).
The Authority does not have a means to collate and analyse all the data that it records, in order to assess industry trends, or identify non-compliant operators. In our view, this undermines the effectiveness of the Authority’s monitoring of the industry.
Collection of more detailed information would help the Authority to assess the taxi industry’s level of compliance. Other jurisdictions collect such information, with the organisation responsible for the taxi industry measuring taxi industry performance against a range of performance standards.
The Authority believes that it is not its role to maintain information about who is working in the industry, and whether they are meeting their legislative obligations. Instead, the Authority relies on taxi organisations to maintain this information in accordance with their ongoing obligations under legislation. Staff from the CVIU told us that, while taxi organisations are responsible for maintaining records of drivers and taxis, they could not be trusted to do so.
Relative road safety risk
Given its resource allocations, the Authority’s safety focus is on reducing or minimising death or injury in the land transport system. Using this approach, taxis are not a priority.
Even if the taxi industry was considered a higher safety risk, the Authority says that a lack of resources affects its ability to undertake monitoring. We found that several Compliance Officers were seconded to other roles, such as creating policy or training material for the National Office. While this is a good use of their operational knowledge, it adversely affects the ability of regional offices to cope with the workload.
The Authority carries out safety audits. In its Statement of Intent 2004/2005, the Authority said it sought the following results from its safety auditing output class–
This output class contributes to the government’s desired outcomes of:
a safe, sustainable transport system at reasonable cost
the objectives in the New Zealand Transport Strategy.
In contributing to these outcomes the Authority also expects that:
all vehicle and operator compliance rates for road and rail will be improved
poor performing operators are targeted to lift their performance to the required safety levels
industry awareness relating to the maintenance of safe vehicle and operator practices is increased
an environment that engenders industry co-regulation is created.
The funding provided will only allow limited achievement of the above outcomes and results.
However, there are no performance measures specifically for the taxi industry. Before 2000-01, the Authority reported its performance against an audit target for ‘Taxi and other small passenger service organisations’ in its Annual Report. Since then, such audits have been included in a larger ‘transport service operations’ category.
We recommend that Land Transport New Zealand report, in its Statement of Intent and Annual Report, the results of audits relating to the taxi industry separate from other transport service operations.
The CVIU’s audits are categorised by scale according to how comprehensive they are. In contrast, the Authority does not differentiate its audits. This means that, for example, an audit of a 20-truck fleet operation is counted as one audit, and so is an audit of a 2-car taxi organisation. In our view, this discourages regional offices from carrying out audits of large fleets, and audits that are more comprehensive, because they would get only the same credit as they would for audits of smaller organisations.
We recommend that Land Transport New Zealand establish a scale for differentiating between audits of varied size, and reflect this in its Statement of Intent.
During 2003-04, the targeted number of safety audits was met for all parts of the land transport sector (not just taxis), as set out in the Statement of Intent 2003/2004. The performance targets for the 2004-05 year are also shown in Figure 6.
Safety auditing targets for 2003-04 and 2004-05
2003-04 targets
2004-05 targets
Driver licence administration 30 30 0 3 agents
Driver licence course provider 30-40 42 140-160 276 providers
Licensed transport service operations 100-120 181 100-120 93,870 transport service operations
Transport operator vehicle fleets 40-50 80 40-50 449,887 transport service vehicles
Random roadside audits of transport service vehicles 20-40 69 20-40 449,887 transport service vehicles
Source: The Authority’s Statement of Intent 2003/2004, and Statement of Intent 2004/2005.
With reference to the “population” column of Figure 6, it is clear that the Authority conducts only a small number of audits as a proportion of the population of each category. Accordingly, its audit coverage of the transport sector is limited.
Variations in the amount of monitoring carried out by regional offices
The ease with which the targets can be met varies between regional offices. The Palmerston North regional office states it can easily reach its targets, while the Wellington office says it is having some difficulty. The Authority advised us that the regional offices are on target for 2004-05.
In relation to the taxi industry, the 7 regional offices conducted a total of 143 audits – of taxi organisations, providers of passenger endorsement courses, and providers of area knowledge courses – during the period from 2001-02 to 2003-04. Figure 7 shows the number of audits conducted by each regional office, which are also expressed as a proportion of all audits done by the Authority. We also illustrate the taxi populations covered by each office as a proportion of New Zealand’s taxi population.
Audits during 2001-02, 2002-03, and 2003-04, by regional office
No. of audits 91 12 7 9 7 15 2
% of audits 64% 8.5% 5% 6% 5% 10% 1.5%
No. of taxis* 3968 565 189 276 1488 1061 542
% of taxis 49% 7% 2.5% 3.5% 18% 13% 7%
* For 2003-04.
Figure 7 shows that Auckland conducts, by far, the majority of audits done by the Authority in relation to the taxi industry, in keeping with the large number of taxis covered by that office. However, in Wellington and Dunedin, the number of audits is below that expected, given the number of taxis in those regions.
Figure 8 shows the number of audit hours recorded by each regional office, from 2001-02 to 2003-04, for passenger endorsement audit investigations. The passenger endorsement audits include driver and vehicle licensing, offences, complaints, rule compliance, area knowledge, and vehicle condition.
Hours spent on passenger endorsement audit investigations during 2001-02, 2002-03, and 2003-04, by regional office
Auckland 2025 2129 696 4850
Hamilton 659 881 1015 2555
Napier 148 117 144 409
Palmerston North 66 410 540 1016
Wellington 1043 736 182 1961
Christchurch 2308 1816 1987 6111
Dunedin 1508 1197 1530 4235
Total 7757 7286 6094 21,137
Figure 8 also shows the variation between regional offices in audit hours, but, more importantly, shows the variation from year to year within the regional offices. This was especially pronounced in the Auckland and Wellington offices between 2002-03 and 2003-04, where there was a 67% and 75% drop, respectively, in audit hours.
One reason given by the Authority for this decrease has been a “spike” in endorsement applications. After 5 years of the driver licensing system, many occupational drivers needed to renew their endorsements. However, the Authority told us the regional offices were given extra resources to deal with this situation.
Figure 8 shows that the other regional offices increased their audit hours during the same period. The decrease in audit hours recorded by the Auckland and Wellington regional offices is a concern because those offices cover the 2 largest taxi populations.
The Executive Director of the Taxi Federation believes that the Authority’s compliance resources have not kept pace with the significant increase in taxis since the limit on taxi numbers was removed in 1989, particularly in the main urban centres.
The Authority advised us that in 1989 there were 18 Enforcement Officers (an equivalent position to a Compliance Officer) who conducted enforcement and compliance work for the Ministry of Transport, along with Traffic Safety Service Officers. As at September 2004, there were 42 compliance (enforcement) staff. During roughly the same period, New Zealand’s taxi fleet has grown from more than 2700 taxis to more than 8000 taxis. So, while in 1989 there were about 152 taxis for each Enforcement Officer, by September 2004 the ratio was about 192 taxis for each compliance (enforcement) staff member.
The increase in the number of taxis and drivers has accordingly reduced the time that compliance staff can spend on compliance monitoring, because more of their time is taken up with applications for new endorsements, and endorsement renewals. We note that this pressure is compounded by growth in other parts of the land transport sector (for example, goods service vehicles) that the Authority is also responsible for.
Variations in the type of monitoring carried out by regional offices
As well as variations in the level of monitoring, there are regional variations in the type of monitoring work carried out. As part of our fieldwork, we asked to attend any audit work scheduled during our visits to the regional offices. The Authority organised audits of taxi organisations, and course providers for passenger endorsements. We were unable to observe roadside taxi audits carried out by the Authority, because none were scheduled.
In 2003-04, the Authority reported that it completed 69 random roadside audits of transport service vehicles, of which taxis are one class. The Authority told us that, as at May 2005, there were 449,887 registered transport service vehicles. The Authority does not centrally record statistics on the type of vehicle (for example a taxi, or a truck) that was stopped, which prevents it targeting audits to risk. Figure 9 shows the hours spent on random roadside audits by each regional office during 2001-02, 2002-03, and 2003-04.
Hours spent on roadside audits during 2001-02, 2002-03, and 2003-04, by regional office
Auckland No record 4.5 131.25 135.75
Hamilton 1.25 3.25 11.25 15.75
Palmerston North (including Napier) No record 24.75 214 238.75
Wellington 1.25 37 77.75 116
Christchurch No record 640 252.75 892.75
Dunedin 68 54.5 41.25 163.75
Total 70.5 764 728.25 1562.75
As in Figure 8, Figure 9 shows significant variation between regional offices in the number of hours spent on roadside audits. Nevertheless, additional emphasis has been placed on these audits during 2002-03 and 2003-04. During the 3-year period from 2001-02 to 2003-04, each regional office completed an average of about 74 roadside audit hours each year.
In Auckland, we were impressed with another type of monitoring operation because of the:
level of interaction involved between the regional office and other agencies;
thoroughness of the checks; and
follow-up actions taken by the Authority in response to non-compliance.
This operation involved the Authority, the CVIU, and the IRD, inspecting the vehicles and drivers of a taxi organisation. The Authority required 360 taxis to be presented for inspection. Eighty-two drivers failed to appear with their vehicles. According to the CVIU report on the operation, “40 drivers resigned from the company rather than be subjected to investigation.” Of the 278 taxis that were presented–
… 57 [or 20%] were put out of service until repairs were effected and a new COF [Certificate of Fitness – the commercial vehicle equivalent of a Warrant of Fitness] issued and 4 of these were ordered not to be driven and were towed from the site.
In addition, from the 278 taxis inspected, 587 defects were identified – an average of 2.1 defects for each vehicle, which the reporting Compliance Officer described as “unacceptable”. The IRD also expressed “amazement at the number of operators who are not GST-registered or even paying tax.” Subsequently the IRD requested from the Authority a list of all vehicles and drivers inspected during the operation.
The Authority’s only means of locating the 40 drivers who had left their taxi organisation was to use the driver details contained on the Driver Licence Register, and ask the drivers if they were working for another organisation. This was time-consuming, and had no guarantee of success. However, the exercise was important, as the drivers who resigned were probably non-compliant, given their failure to appear at the audit. We were pleased that, in this case, the Authority traced the 40 drivers to ensure that, if they were still driving a taxi, they were doing so in compliance with their legislative requirements.
This operation illustrates that, even for a scheduled inspection, which gave taxi drivers notice that their vehicle would be inspected, a significant level of non-compliance was found. We consider that random roadside audits would be even more effective, as drivers would have no warning; so more non-compliance would probably be found.
If the Authority increased its visibility through more roadside audits, the likelihood of an audit would provide an incentive for drivers to maintain vehicle standards, and to keep their passenger endorsement and driver identification card up to date. Currently, drivers know that audits by the Authority are rare, and that audits are more likely to be conducted by the CVIU.
We recommend that Land Transport New Zealand review the number of random roadside audits it conducts of taxi drivers.
As well as its work with the CVIU and other government agencies, the Auckland regional office also interacts positively with other parties, such as the Auckland City Council. We note, however, that the Council drives these initiatives, and feels that it is taking responsibility for functions that lie with the Authority. In other regions we visited, there are no regular meetings between the Authority and regional and city councils.
Authority staff we spoke to suggested that, because they received few complaints, there is general satisfaction with the taxi industry.
However, despite the Authority’s lack of monitoring data, the information available to us – from the Auckland operation noted above, our direct observation, reports from industry, and the results of CVIU monitoring (see Part 5) – suggests a high level of non-compliance within the taxi industry.
Monitoring taxi organisations
Taxi organisations are easily established, with almost no capital investment. As they do not require any knowledge of the regulations applicable to the industry, some of the people in control of taxi organisations lack the knowledge and resources to manage and control their organisations.
We attended, with the Authority, an audit of a taxi organisation. The director in charge did not understand the requirements for running a taxi organisation. The resulting non-compliance required use of a disproportionate amount of the Authority’s resources to attempt to bring the taxi organisation back into compliance, through ongoing oversight and audit.
Some taxi organisations may have irregular contact with their drivers, particularly those organisations that do not receive much work through telephone requests for taxis. For example, some taxis rely on collecting passengers from taxi ranks, and some do not have radio equipment. Taxi organisations may, therefore, have little effective control over their drivers, and little knowledge of whether the drivers are complying with their obligations under either the taxi organisation’s rules, or the legislation.
Taxi drivers must comply with a range of transport service and vehicle regulations, and may have the obligations of self-employment (such as paying GST and income tax). They need extensive education before entering the taxi industry, and ongoing assistance to comply with their obligations. This is particularly important for immigrants, who may be less familiar with New Zealand laws and not know where they can get help to comply with their legal obligations. Often taxi organisations are not able to provide this assistance.
One Regional Compliance Officer stated that his office conducts no monitoring of taxi organisations. He stated that, if something came to the Authority’s attention, staff might investigate it, but the approach was informal and unplanned. The Regional Compliance Officer stated that the office previously did 3 to 4 audits of taxi organisations each year, but now audited only new taxi organisations. The office had completed 2 taxi organisation audits in 2003 and expected to do 2 during 2004. His office had not done any roadside audit operations for at least a year, and the last offence notice his office issued was in November 2003.
The people involved in running a taxi organisation are required to be fit and proper during the entire period they operate a taxi organisation. However, their fitness and propriety is assessed only once. The Authority does not carry out any ongoing monitoring of the people running a taxi organisation. Rather, the Authority acts on complaints, or information received from the Police.
The Authority noted that, in situations where a taxi organisation’s approval might be revoked, its drivers would quickly join other firms or start new ones. In our view, a regular fitness and propriety check for those in control of a taxi organisation would be appropriate, though not necessarily on an annual basis. Taxi organisation managers are more removed from the public than drivers, so there is not such a direct public safety risk. If those who control a taxi organisation are also drivers, they will have their fitness and propriety assessed annually.
We recommend that Land Transport New Zealand regularly assess the fitness and propriety of those who have control of taxi organisations.
Several regional offices had conducted seminars on the “willing compliance” philosophy, or held meetings with the taxi organisations in their area. Such contact with the Authority is generally well received and attended by the industry. For example, the Authority told us that all but one taxi organisation in Auckland attended the seminars they ran on “willing compliance”.
Taxi organisations operating in the area covered by the Palmerston North regional office are invited to attend quarterly meetings with Authority staff, which are well attended and generally seen as informative by those attending. We consider that such interaction with taxi organisations is a useful way of promoting best practice, and that it could be applied to other sections of the industry, such as passenger service licence holders. We note that several overseas jurisdictions have regular newsletters for advising the taxi industry of information, such as any changes that the industry should be aware of.
We recommend that Land Transport New Zealand regularly communicate best practice guidance, and provide up-to-date information about changes relevant to the taxi industry.
Complaints registers
Taxi passengers who wish to lay a complaint may do so with the Authority or with the taxi organisation. While taxi organisations are obliged to maintain a complaints register, they have no obligation to report complaints to the Authority.
Taxi organisations should bear the responsibility for investigating routine complaints. However, it could be useful to specify that certain serious complaints be reported to the Authority. The Authority can then ensure that these complaints are satisfactorily investigated.
In one jurisdiction, for example, taxi organisations must report specified serious complaints to the industry regulator within one working day. The Authority states that the draft new Operator Licensing Rule (see Part 7) proposes that taxi organisations must notify the Director of the Authority within 48 hours of any serious complaints reported to them.
One office reported that it does not check a taxi organisation’s complaints register on a regular basis, and one taxi organisation that we spoke with stated that its complaints register had not been checked in 15 months.
We recommend that Land Transport New Zealand ensure that taxi organisations report to it certain serious complaints.
Logbooks and demerit points
The Taxi Federation suggested to us that the logbook system is open to abuse, and is not well supervised. Further, there are concerns that some taxi drivers also have other jobs, which increases the risk of fatigue. Nevertheless, the Federation believes that the system has value. Some record of driving hours is necessary for safety reasons. Research shows that there is a link between fatigue and impaired driving, which can be similar in effect to driving while intoxicated. Accordingly, limiting driving hours is important.
The logbook system is easily abused. It is an honesty system, and there is little likelihood of a driver being caught for false entries. The link between fatigue and risk justifies efforts to find a more effective way of monitoring hours worked.
The Land Transport Amendment Bill proposes to require taxi organisations to record and monitor driver hours, which will help to address non-compliance. We acknowledge that it is difficult for a taxi organisation to prevent a driver working excess hours, but we have seen instances where a taxi organisation’s dispatch system has the ability to electronically record and monitor an individual driver’s hours.
A commercial vehicle demerit points system (separate from the general licence demerit points system) was introduced in 1989, and is contained in sections 12 to 14 and Schedule 2 of the Transport Services Licensing Act 1989. This system was designed to control commercial drivers’ behaviour. However, no operators or drivers have been disqualified under this system because it was never set up.
The Authority advised us this was because of technical difficulties in introducing such a system separate from the general licence demerit points system. This situation is unsatisfactory, particularly as the system was created by statute and its provisions remain in force.
We note that the Land Transport Amendment Bill proposes to remove the commercial demerit points system. Nevertheless, the scope of the general licence demerit points system has recently been expanded, which suggests that demerit points are effective in controlling driver behaviour.
We recommend that Land Transport New Zealand explore options for incorporating commercial demerit point offences within the general licence demerit points system.
Industry calls for more economic monitoring
The Authority considers that economic risks, such as overcharging, are for the market to regulate, and are not the Authority’s business. The Authority has advised that its investigations of overcharging complaints usually find that the complainant has not checked the taxi’s fare schedule, which would have told them that some taxi organisations charge more than others, as they are allowed to do.
The taxi industry considers that the Authority has a role in ensuring economic risks are managed. For example, we heard from numerous industry sources that the basis of the changes in 1989, with the introduction of a market model, was a strong, economic compliance function to ensure an “even playing field”.
The Taxi Federation and the then National Manager of the CVIU suggested that the change from a quantitative to a qualitative framework in 1989 was based on there being adequate monitoring to ensure that standards are maintained appropriately, and that there is a level playing field for industry participants. Some industry participants stated that a lack of compliance work by the Authority has caused an uneven playing field. They argued that an even playing field is a fundamental requirement of a free market approach, and that the Authority has been concerned with issues of public safety and not the market.
Overall, taxi industry representatives we spoke to expressed concern that the Authority is not adequately monitoring the activities of the industry.
Industry comments suggest that an uneven playing field exists because some taxi organisations and drivers are not complying with tax requirements or otherwise not fulfilling their obligations. We note that the Authority has requirements to encourage economic compliance, through Road User Charges and checks on the accuracy of meters when a vehicle is inspected for a Certificate of Fitness. However, we consider that checks on economic compliance could be supplemented by better ongoing monitoring by the Authority. For example, meter seals could be checked through roadside monitoring rather than just at Certificate of Fitness renewal. We have seen examples of unsealed meters, as have CVIU staff.
We recognise that the priority for the Authority’s resources should be directed at personal safety risks over economic ones. However, inadequate monitoring means that the level of compliance is unknown. We were concerned by the IRD’s comment during the joint exercise noted in paragraphs 4.34-4.38 about the number of operators who are not GST-registered or paying tax. While economic risks such as overcharging are less serious, they are more often realised, and should be addressed by the Authority (in conjunction with the IRD, as it is primarily responsible for ensuring compliance with tax obligations).
We recommend that Land Transport New Zealand undertake compliance activity to address economic risks, including working with the Inland Revenue Department where appropriate.
Addressing the lack of data
The Authority relies on taxi organisations to maintain records of drivers, their qualifications,19 and their vehicles, as the Authority does not keep this information. The CVIU expressed concern that the Authority does not hold such records, even though it is the taxi organisations’ responsibility; because, while many taxi organisations do keep robust records, some do not. There is, therefore, no complete record of who is operating as a taxi driver, and for whom they work.
The only way to check that taxi organisation registers are up to date is to match information collected from roadside audits against the information held by taxi organisations. We saw no evidence that the Authority does this.
The small numbers of taxi organisation audits that do occur have limited value, because the accuracy of the records kept by the taxi organisations cannot be assessed. A taxi organisation could have 60 drivers working for it, but keep records for only 40, without the Authority’s knowledge. There is, therefore, no check that the other 20 drivers have, for example, the required Area Knowledge Certificate(s).
We recommend that Land Transport New Zealand work with the CVIU to compare information gathered from their respective audits and on-road inspections with records kept by taxi organisations.
In our view, the Authority should require taxi organisations to regularly send it specific details (such as details of their drivers, and passenger service licence holders, including Area Knowledge Certificates, and the complaints register).
The Land Transport Amendment Bill proposes to provide Enforcement Officers with the power to inspect, on request, all relevant books or records held by any person, to whom the Land Transport Act 1998 applies (including those in control of a taxi organisation). While we support this approach, we also consider there would be value in getting this information regularly, to gather intelligence on the industry that would help target audits according to risk.
Monitoring passenger service licence holders
The people who hold passenger service licences are required to be fit and proper during the entire period they hold that licence. However, their passenger service licence never expires, and their fitness and propriety is assessed only once, even though the fit and proper person requirement is ongoing. The Authority does not monitor passenger service licence holders. Rather, the Authority acts on complaints, or information received from the Police or other sources.
The Authority’s record of passenger service licence holders is not up to date because there is no requirement to renew the licence. The Authority’s National Office has provided additional resources to regional offices to update their transport service licence files by removing records for passenger licence holders who are no longer operating.
The Authority has previously considered requiring passenger service licence holders to renew their licences periodically, but rejected the move as being too costly and bureaucratic. The Authority has also considered introducing expiry dates for passenger service licences, but decided the compliance cost was not justified.
We recognise that some passenger service licence holders may not actually drive a taxi and therefore do not have contact with the public. However, the legislation requires that they are fit and proper for the entire period for which they hold their passenger service licence.
The Authority is responsible for ensuring passenger service licence holders comply with this requirement, so a regular check is appropriate. It need not necessarily be on an annual basis, because passenger service licence holders may be more removed from the public than drivers. Furthermore, those passenger service licence holders who are also drivers will have their fitness and propriety assessed annually in their role as a driver.
We recommend that Land Transport New Zealand regularly assess the fitness and propriety of passenger service licence holders.
The Authority does not know which taxi vehicles are being used by which drivers, because neither passenger service licences nor passenger endorsements are linked to taxi vehicles. Taxi organisations are required to keep a record of the vehicles being used as taxis in their fleet, but taxi organisations do not regularly supply this information to the Authority. There is also no guarantee that information from taxi organisations would be accurate, and checking would require roadside audit data and taxi organisation records to be matched, which does not occur.
Knowing which taxi vehicles are linked to which passenger service licences and passenger endorsements would provide the Authority with useful information for monitoring the industry; in particular, the requirement that transport service operators are licensed.
According to the Taxi Federation and some Authority staff, many taxi drivers who should hold passenger service licences do not. Again, we were unable to determine the level of non-compliance because of a lack of monitoring. These drivers have not been required to notify their intention to apply for such a licence, which is a useful means of bringing any complaints about them to the Authority’s attention. Furthermore, such drivers have not passed the Certificate of Knowledge of Law and Practice examination, which means they may be operating a passenger service without the required knowledge of their obligations and responsibilities.
Passenger service licence holders are obliged to disclose the full name and address of an employee driver who has allegedly committed an offence, if requested to do so by the Director of the Authority or an Enforcement Officer. An additional obligation is that such licence holders must notify the Director of any changes in their details. Staff at each regional office acknowledged that this often does not occur. The Authority does not take action against the passenger service licence holder for this failure. One Regional Compliance Officer told us that conducting this follow-up action would require committing too much time and resource.
Monitoring taxi drivers
The taxi industry has low entry costs. However, the taxi industry has a complex regulatory framework. In addition, taxi drivers are essentially running their own business, and therefore must meet a range of legal obligations, including managing their tax responsibilities. One taxi organisation we spoke to pointed out that there is no requirement for taxi organisations to keep records of the hours that drivers work, or their payments. The taxi organisation suggested that this lack of record keeping contributes to people not paying GST or income tax. We note this lack of record keeping is addressed in the Land Transport Amendment Bill.
When renewing passenger endorsements, the Authority’s approach to reassessing fitness and propriety is similar to that used when assessing new applications. Passenger endorsement holders who renew their endorsement on an annual basis are subjected to the Police check when they renew, while those who hold a 5-year endorsement are also checked each year. Renewing endorsements is an administrative task, with issues arising only if the Authority or Police checks reveal that an applicant has incurred any criminal or traffic convictions during the past year.
There are a number of problems with endorsement renewals. As noted for fitness and propriety assessments, the Authority does not have access to the Police’s “red stamp” information. In between Police checks for entry and renewal purposes, the Police do not automatically notify the Authority of taxi drivers who are charged or convicted of serious offences. Non-notification prevents the Authority from taking appropriate enforcement action, such as suspending the driver, if necessary, pending the outcome of their case.
Some staff at the CVIU and the Authority believe that the current system is adequate, and there would not be a greater level of notification if a formal agreement existed between the Authority and the Police. We consider that formality is required around the provision of information, and that the Authority and the Police need to agree which offences must be notified to the Authority.
The Authority also needs to provide the Police with information on those drivers whose licence or endorsement the Authority has suspended or revoked. This will allow the Police to take appropriate enforcement action if the driver comes to the Police’s attention.
We recommend that Land Transport New Zealand and the Police investigate options for the formal and regular notification of taxi drivers who are charged or convicted of serious offences, to Land Transport New Zealand.
We recommend that Land Transport New Zealand ensure that it provides information to the Police about drivers whose licence or endorsement has been suspended or revoked.
No record is kept of instances when the Police do not notify the Authority that charges have been laid against a taxi driver for a serious offence. It would be useful if the Authority recorded the number of times it was not notified by the Police (based on subsequent discovery of the offending during the annual re-check or from some other source), and the reason why it was not notified. This record would allow the Authority to assess the extent of non-notification, and set up procedures to address the situation.
We recommend that Land Transport New Zealand monitor the frequency of non-notification of serious offences committed by taxi drivers, as discovered in the annual reassessment of fitness and propriety or from other sources, and use this information to improve notification rates.
The Police and the Authority have conducted a trial, approved by the Privacy Commissioner, to match data between their systems, to find drivers whose offences or convictions required notification to the Authority. However, because the Authority and Police systems use different identifiers (alphabetical versus numeric) the rate of matches between the systems was unacceptably low.
Further, the Police cannot search their system for any taxi drivers who have particular convictions, because the Police do not record a person’s occupation in the database. They can search by offence type, which allows them to search for offences that are specific to taxi drivers (such as operating an unlicensed passenger service).
While not appropriate for serious offences, we consider that it would be useful for the Authority to obtain information from the Police on all taxi-specific offences, possibly on a monthly basis, to assist it in monitoring the ongoing compliance of taxi drivers.
Overall, communication between the Police and the Authority is informal and unscheduled, with a high likelihood that taxi drivers facing charges for serious offences could continue to operate a passenger service because the Authority had not been notified. Some of the longer serving staff in the Authority rely on informal links with former colleagues in the Police, to ensure that those drivers facing charges for serious offences are suspended, pending the outcome of their case. However, on occasion, the Authority finds out through the media about taxi driver offences, the seriousness of which demands Authority action to suspend or revoke the driver’s licence or endorsement.
Under the current, informal relationship with the Police, there is a risk that the Authority will not be notified of instances when an offence is committed by someone who has been assessed as fit and proper, and given 90 days to complete the remaining requirements to obtain a passenger endorsement. The Authority may also not find out in a timely fashion when those who have been issued a “without prejudice” letter (discussed in Part 3) have been charged with additional offences.
There is no obligation for either taxi organisations or passenger service licence holders to notify the Authority of offences by their drivers. We note the Authority’s point that a new Operator Licensing Rule will require taxi organisations to notify the Director of the Authority within 48 hours of any serious complaints reported to it about its drivers.
In addition, passenger service licence holders are obliged to disclose the full name and address of an employee driver who has allegedly committed an offence, at the Director of the Authority’s or Enforcement Officer’s request. However, we consider that the Authority should also require taxi organisations and passenger service licence holders to notify the Authority of offences by their drivers when they become aware of them, recognising that sometimes they will not.
Implementing such a system will provide another means by which the Authority could become aware of any offences by taxi drivers that might affect their fitness and propriety to drive a taxi. Further, it would reduce the current risk that the Authority does not find out about a taxi driver’s offences until they have their annual fitness and propriety assessment, by which time they could have been driving for some time without being fit and proper to do so.
We recommend that Land Transport New Zealand require taxi organisations and passenger service licence holders to notify it of any offences by taxi drivers that they become aware of.
Monitoring drivers on temporary permits
Taxi organisations and passenger service licence holders are responsible, when they employ drivers, for checking that their employee drivers have a valid work permit before allowing them to work. Taxi organisations and passenger service licence holders are also responsible for ensuring that employee drivers on a student permit adhere to the conditions of their permit.
Taxi organisations are not advised by the New Zealand Immigration Service, or the Authority, that the person is permitted to work only up to 15 hours a week. The Authority does not check that those drivers on a student permit, who are permitted to work, are working only the allowed number of hours. The Authority is unable to advise the taxi organisation about the restrictions on the driver’s working hours, or monitor a taxi organisation’s controls on drivers who must work only up to 15 hours a week, because it does not record for whom a particular passenger endorsement holder is working.
In the Authority’s view, this is for the taxi organisation to control, and the New Zealand Immigration Service to enforce. Section 39 of the Immigration Act 1987 states that every employer who employs a person knowing they are not entitled to work, commits an offence. Often, taxi organisations do not obtain this information. They rely on the fact that the Authority has issued the driver with a passenger endorsement as evidence that the driver is legally able to work.
It is likely that some taxi drivers, on student permits that allow them to work, are working more hours than permitted. We were not able to assess how widespread non-compliance is, because there is no monitoring. The Authority could do more to educate taxi organisations about their responsibilities in this area. This could form part of the content of a course that applicants must complete before they can be involved in managing a taxi organisation.
We recommend that Land Transport New Zealand educate taxi organisations about their responsibility to ensure that drivers have appropriate work permits.
We are concerned that responsibility for monitoring to ensure that a person has a current work permit is falling between the Authority, the New Zealand Immigration Service, and taxi organisations. This is a serious issue as, if a person allows their work permit to expire, they could be no longer fit and proper to operate a taxi.
We recommend that Land Transport New Zealand and the New Zealand Immigration Service clarify their respective responsibilities in relation to monitoring work permits for licensing purposes, and ensure that immigrants without current permits cannot drive a taxi.
Immigration checks are not carried out when taxi drivers apply to renew their passenger endorsement. Because the Authority does not check an applicant’s immigration status when they renew their endorsement, even if they have a temporary permit, the Authority does not find out if an applicant’s permit has expired since they entered the taxi industry.
Further, the person may have obtained, or applied for, permanent residency. To become a permanent resident, a person must supply a Police record for every country they have lived in for 12 months or more during the last 10 years, as well as a Police record for their country of birth. This new information would be useful for the Authority in assessing a person’s fitness and propriety. However, because no further check is undertaken, the Authority never obtains this information.
We recommend that Land Transport New Zealand review the work status of applicants, who were on temporary work permits when approved for a passenger endorsement, when they apply to renew their endorsement.
The Authority does not check whether a person is still entitled to work after the expiry date of their permit, and believes this is a matter for the New Zealand Immigration Service to monitor and enforce. Nevertheless, the Authority accepts that a person’s ability to lawfully reside and work in New Zealand may be relevant to an assessment of that person’s fitness and propriety.
The Authority has the technology to produce an automatic printout of endorsement holders as their permits expire, and currently produces an automatic report listing those drivers who are due for an annual Police check. Staff at the New Zealand Immigration Service advised us they follow up expired permit holders only if the Service receives information from an employer, the Police, or any other source.
It is the responsibility of a taxi organisation, and passenger service licence holders who employ drivers, to ensure that drivers work no more than their legal number of hours. However, if the Authority recorded more information about a driver’s permit when it conducted its immigration check, it could monitor whether taxi organisations and passenger service licence holders have systems in place to ensure that drivers do not work more than the hours allowed by their permit.
We recommend that Land Transport New Zealand record details of temporary permits, including when the permit expires and how many hours a person may work, to allow it to monitor the performance of taxi organisations and passenger service licence holders, gather information about drivers, and ensure that drivers comply with their permits.
We are concerned that a fundamental prerequisite for legally operating a taxi by non-residents (a valid work permit) appears to go unmonitored once a person enters the industry. Again, this illustrates that many taxi organisations lack the knowledge to fulfil their responsibilities. Passenger service licence holders who employ drivers also need to be aware of their responsibility to ensure that drivers have valid permits, as taxi organisations may not know that a passenger service licence holder has employed a driver to work for them.
However, in order to fulfil their obligation to exercise proper control over their drivers, taxi organisations need to ensure that their passenger service licence holders notify them of any drivers they employ, and that the drivers are legally able to work.
We recommend that Land Transport New Zealand confirm, through audits, that taxi organisations and passenger service licence holders gather and maintain information about the work status of drivers and, for taxi organisations, its members.
Renewing passenger endorsements
The Authority does not follow up drivers when their passenger endorsement expires, to confirm that they have ceased operating, because it considers that it would not be a good use of resources to do so. CVIU staff report finding taxi drivers operating with expired passenger endorsements. The Authority considers that monitoring endorsement validity is the taxi organisation’s responsibility.
Some taxi organisations we met with monitor the currency of endorsements, using electronic monitoring systems. Nevertheless, we are concerned that a driver’s passenger endorsement (a basis for their legal operation of a taxi) can expire without the Authority having a means to check – for example, through audits of taxi organisations – that they have actually ceased driving a taxi.
When a taxi driver renews their passenger endorsement, the Land Transport (Driver Licensing) Rule 1999 requires another check of the person’s eyesight. While the Authority advised us that an agent cannot continue to enter the details from an application form without entering the result of an eyesight check, or details of an eyesight certificate, 34% (41 of 119) of renewal files that we reviewed did not contain evidence that such a check had been carried out.
Holding the appropriate Area Knowledge Certificate
We were unable to determine the level of compliance with the requirement that drivers hold Area Knowledge Certificate(s) for the area(s) where a taxi organisation operates. The Authority is not able to check that a taxi is actually operating in the area for which the driver has area knowledge, because the taxi organisation holds the only record of Certificates. The Certificates are checked only when the Authority audits a taxi organisation, or possibly if they receive a complaint from a member of the public about a driver’s lack of area knowledge.
Given the persistent public perception that drivers do not have adequate area knowledge, and evidence of fraud involving Area Knowledge Certificates, the Authority needs to be able to assess compliance in relation to Area Knowledge Certificates. If the Authority does not, the licensing system loses credibility.
Driver identification cards
When a driver identification card is renewed, a taxi driver is not obliged to return the expired card. A person can hold more than one driver identification card, which provides an opportunity for the fraudulent use of expired cards. While all drivers checked during our observation of the CVIU’s on-road inspections held valid driver identification cards, the CVIU has found instances where a taxi driver was using an expired card.
We recommend that Land Transport New Zealand ensure that expired driver identification cards are surrendered at expiry, or when a replacement card is provided.
It is relatively easy to obscure the part of a driver identification card that contains its expiry date. The Authority advised us that, based on case law, there is no requirement to place the driver identification card in a particular part of the taxi, although the card must be reasonably visible to passengers.
We recommend that Land Transport New Zealand enlarge, or otherwise make more prominent to passengers, the expiry date on driver identification cards, and require drivers to display their card in a prescribed place to ensure that it is visible to passengers.
Regulations require taxi organisations to keep a register of complaints in a prescribed form. Under legislation, the Authority must have particular regard to any complaints about a person involved in a small passenger service that are of a persistent or serious nature.
In assessing fitness and propriety for renewal applications, there was no evidence in the files we reviewed that the Authority had checked either the taxi organisation’s or the Authority’s complaints registers to see whether complaints had been made against the driver. One office claimed that, unlike other regions, they did check for complaints. While they may check, there was no evidence of this in any of the renewal application files we reviewed.
We recommend that Land Transport New Zealand ensure that, when considering renewal applications, it examine whether complaints have been made about the driver to Land Transport New Zealand or to the driver’s taxi organisation.
Monitoring course providers
Passenger endorsement courses
Anyone can apply to provide the passenger endorsement courses that prospective taxi drivers must complete. Accordingly, there are many course providers, which makes effective auditing by the Authority more difficult. The Authority’s present monitoring regime for passenger endorsement course providers is unco-ordinated and inconsistent between regional offices, and places some reliance on the New Zealand Road Transport and Logistics Industry Training Organisation’s (ITO) own audits (moderation) as a means of maintaining standards.
Concerns have been raised within the Authority about the resourcing of compliance activity (capacity and capability), and a lack of strategic direction to compliance monitoring of approved course providers. A specific concern was raised that approved providers might not have been delivering the quality of service expected to reach the safety gains required, possibly as a result of not having the necessary skills and experience, or for reasons of commercial expediency.
To explore these issues further, the Authority commissioned a review of the way it approves the providers of courses covering several licence classes and endorsements, including the passenger endorsement. The review was conducted by an Australian consultant with experience in commercial driver training both in Australia and in New Zealand. The reviewer reported in July 2003, and identified a number of risk areas. The risk areas included:
the qualifications required of approved course providers are not sufficient to ensure the necessary knowledge, skills, and experience, or to ensure a high standard of performance in all aspects of the role;
the Authority has not established an appropriate and targeted auditing regime for approved course providers, which results in lower standards and an inability to identify and apply sanctions to poor performers;
the quality management system applied by the ITO may not adequately address the Authority’s perception of risk areas, and the Authority’s reliance on the ITO’s moderation may not be well founded;
there is a lack of training and development to address a lack of knowledge and experience among compliance staff;
there are inconsistent course standards, assessment procedures, and documentation, which results in lower standards;
conditions imposed on course providers at the time of their approval are not applied uniformly across the country and can be contradictory;
there is a lack of documented guidelines for course provision resulting in subjectivity in application; and
there is no clear chain of responsibility or lines of communication to provide direction, resulting in regions being left to determine and interpret procedures in isolation.
We consider that each of these risk areas remains current, although the Authority has taken steps to address some of them, as discussed below.
The Land Transport (Driver Licensing) Rule 1999 gives the Authority the power to revoke its approval of providers of passenger endorsement courses, but not to suspend them. The Authority relies on the ITO’s ability to suspend the providers of passenger endorsement courses.
We recommend that Land Transport New Zealand seek an amendment to the Land Transport (Driver Licensing) Rule 1999 to allow it to suspend the approval of a driver licence course provider.
In the Rule, the grounds for revoking a passenger endorsement course provider’s approval are narrower than the grounds for revoking the approval of area knowledge course providers, contained in section 18A(5) of the Transport Services Licensing Act 1989.
The Authority has attempted to obtain broader grounds for revocation, similar to its power in relation to providers of area knowledge courses, by redrafting the contract signed by course providers when they gain approval to conduct courses. However, we believe that, in doing so, the Authority has acted outside its statutory powers to revoke course provider approvals, which are set out in clause 103 of the Rule.
We recommend that Land Transport New Zealand seek an amendment to clause 103 of the Land Transport (Driver Licensing) Rule 1999 to allow it to revoke the approval of a driver licence course provider on the grounds set out in its contract with approved driver licence course providers.
Providers of passenger endorsement courses who are registered with the ITO are subject to additional checks. The ITO conducts annual audits of course content and procedures. Most assessors who use the New Zealand Qualifications Authority unit standard approach use assessments produced by the ITO.
The Authority has not clarified the respective monitoring roles of it and the ITO. The Authority and the ITO have a Memorandum of Understanding that was being re-negotiated at the time of our audit. The memorandum, as it was, provides that the ITO will moderate Authority-approved providers and will assess compliance with the Land Transport (Driver Licensing) Rule 1999. However, the ITO cannot check all aspects of a course provider’s compliance with the Authority’s standards.
For example, the ITO does not have access to the Driver Licence Register, so it cannot check that the certificates presented to the Authority match the records of a successfully completed assessment conducted by the course provider. Therefore, important control checks are not carried out. Greater co-ordination between the Authority and the ITO would result in better checks on course providers, and better use of resources, which would avoid duplication and the risk of delivering conflicting messages to an audited course provider.
We recommend that Land Transport New Zealand and the New Zealand Road Transport and Logistics Industry Training Organisation clarify their respective monitoring roles.
As noted earlier, a concern of Authority staff and the reviewer was the lack of an auditing regime and strategic approach to the course provider regime. The apparent inconsistency of the present approach negatively affects driver standards. As part of the proposed reorganisation of functions of the Compliance Section (see Part 7), the Authority wants to introduce the position of National Advisor (Driver Licensing Standards).
This position would, among other things, provide national management and direction of the interactions between the Authority, the ITO, and course providers. It would also ensure consistency and correctness of regional offices’ approval, auditing, and enforcement of non-compliant providers. We support the concept of such a position, given the potential benefits in co-ordinating Authority activities in relation to course providers.
At the same time as considering introducing the advisor position, the Authority has been debating the need to have specialist compliance staff for areas such as course provision. Currently, compliance staff have job descriptions containing general references to course providers, while in some regions Compliance Officers have been assigned specific course provider duties. The result of having generalists is that low priority is given to monitoring and enforcement of course providers when compared with other compliance responsibilities.
We recommend that Land Transport New Zealand review whether appropriate priority is given to monitoring of, and enforcing compliance by, the providers of passenger endorsement courses.
Area knowledge courses
The Authority conducted 42 audits of the providers of driver licence courses in 2003-04. Although area knowledge courses are not driver licence courses, they are counted as such for the purposes of the Authority’s Statement of Intent. Out of a total of 276 course providers, there are 99 active providers of area knowledge courses, although audit coverage is limited because the Authority does not consider area knowledge to be a safety issue.
The Authority told us it is difficult to carry out effective audits, because the presence of its staff during a course usually means that the course will be conducted properly. It is also difficult to audit test papers where oral answers were provided. Often the answer is recorded as “oral”, so it is not possible to confirm that the answer provided was correct.
During our audit, the Authority and industry stakeholders mentioned many times about course providers selling Area Knowledge Certificates and other documents required for entering the taxi industry. According to the Authority, the problem is that the course providers might be of a particular ethnicity, which makes it difficult for compliance staff outside that ethnicity to gather evidence.
Despite this, the Authority does not regard monitoring of course providers as a priority, particularly those offering Area Knowledge Certificate courses. The Authority perceives this aspect of the taxi industry as a customer service issue, rather than a safety issue. At least one Authority regional office is not actively auditing area knowledge course providers, despite the Authority’s reported intention to audit 10% of providers each year.
We recommend that Land Transport New Zealand review whether appropriate priority is given to monitoring of, and enforcing compliance by, the providers of area knowledge courses.
While the Authority individually numbers Certificates with the aim of controlling and monitoring their distribution, it does not record these numbers. This undermines the effectiveness of numbering of Area Knowledge Certificates as an internal control, as Certificates with the same number could be presented more than once without the Authority’s knowledge.
A number of people within the Authority expressed the view that the current approach to course provision has occurred because the approach has remained the same despite significant growth in the industry. We note that the Authority has increased the number of audits of driver licence course providers from that in 2003-04 (from 30-40 to 140-160, as reported in the Statement of Intent 2004/2005). However, the low priority the Authority gives to area knowledge courses means that few of the planned audits will be of area knowledge course providers.
Most of the issues associated with the large number of course providers could be resolved by selecting a limited number to conduct the area knowledge test. The providers currently offering training and testing would still be able to offer training (therefore ensuring that providers are not forced out of business by the change), but another provider, independent of the training, would conduct the test. This would make compliance monitoring easier, and promote a consistent standard. We are pleased that the Authority is already considering this option, through a review of the area knowledge course provider model. This review could also usefully review the situation for passenger endorsement courses.
In relation to the Certificate of Knowledge of Law and Practice examination, the provider reports monthly to the Authority on any complaints. Statistics such as the number of candidates sitting, and pass rates, are provided on a quarterly basis. The latter report showed that, for the Certificate of Knowledge of Law and Practice, the pass rate for July-September 2004 for the core module was 58%, and for the passenger service module 79%. The provider thought that the Authority had audited it once during the previous 4 years, while other agencies such as the ITO had conducted annual audits.
We asked the provider about the rationale for the multiple-choice and open book examination. In the provider’s view, the multiple-choice format tests exact knowledge of legislation and regulations, while people do not have enough time in the open book test to search the book from start to finish. They need to do some preparation before the examination.
Communication with course providers
The Authority has little or no communication with the providers of passenger endorsement and area knowledge courses. In some regions, Compliance Officers are assigned to particular taxi organisations, but this does not occur for course providers. This is symptomatic of an overall lack of oversight and co-ordination in this area.
We recommend that Land Transport New Zealand establish a method for communicating best practice to course providers.
While the provider of the examination for the Certificate of Knowledge of Law and Practice reports regularly to the Authority on matters such as pass rates, there is no similar reporting process for passenger endorsement and area knowledge course providers.
The Authority’s monitoring intentions – “willing compliance”
Along similar lines to other agencies in the transport sector (for example, the Civil Aviation Authority), the Authority is moving towards a “willing compliance” philosophy, which implies a shared responsibility with industry for ensuring a high level of compliance with Rules and Regulations. This move is on the basis that the Authority believes that current resources need to be allocated in a different way to bring about higher levels of compliance, and is seen as a better option than the status quo. The Authority states that “willing compliance” is not about more enforcement, but less, and better targeted by dedicated enforcement staff once “relationship” staff have failed to bring about compliance by other means.
To accommodate this philosophy, the Authority has planned to reorganise the functions carried out by the Compliance Section (see Part 7). Of particular interest, given our comments on the Authority’s present inconsistent approach to monitoring and enforcing compliance between regional offices, is the proposal to create national positions to provide leadership in audit and monitoring practice. We support the creation of such positions, as they should provide the co-ordination between regions that is currently lacking.
The move to working with industry in “partnership” depends on industry participation and engagement, which is an issue for some taxi organisations. The Authority notes that a level of compliance monitoring would be retained, to ensure that the activities of those who have not engaged with the philosophy are compliant. We are concerned that the Authority will struggle to maintain an appropriate level of compliance monitoring. This is because of the number of competing priorities, and a lack of an overall risk assessment tool to bring together all the data the Authority records to turn it into information that can be used to target audits at non-compliant operators.
There is piecemeal effort in some regional offices to use various data to target audit effort at particular parts of a taxi organisation, once an organisation has been selected for audit. However, there is no tool used on a national basis to identify non-compliant organisations in the first place. The Authority believes that the creation of a centralised investigative function, through the proposed reorganisation of the Compliance Section’s functions, will address this concern.
It is essential that the appropriate balance is struck between willing compliance and enforcement. Some people suggest that, if someone is in the industry, it is their responsibility to ensure they are aware of, and comply with, their legal obligations. This sentiment may be appropriate in relation to some of the more basic requirements for the industry, but it is also recognised that education can be very successful. Nevertheless, it is important that a focus on willing compliance is not a substitute for rigorous entry and monitoring requirements.
Enforcing the taxi industry’s compliance
Some Authority staff members are reluctant to do enforcement work because it would lead to prosecutions, which would take time and resources to pursue. This reluctance also applies to offences that Authority staff believe would have little effect on the safety of the industry if the person was convicted. A popular view is that enforcement is a blunt tool and used only when other options have not been effective.
In the period from 2001-02 to 2003-04, the Authority issued 545 offence notices to taxi organisations, passenger service licence holders, and taxi drivers. Given the high level of industry non-compliance noted by the CVIU (see Part 5), and observed during our fieldwork, we expected the Authority would have issued more notices.
The Authority’s response to our finding was that issuing notices does not change behaviour, and that the CVIU can issue notices, because this is not the Authority’s role. The Authority believes that, because of the limited resources available, it needs to think of other ways to influence behaviour than enforcement through prosecution, which it does not think is the best way to achieve industry compliance.
Accordingly, it is moving towards a “willing compliance” philosophy and reorganising the Compliance Section’s functions. However, we consider that there is value in the Authority issuing notices as a means of enforcement. More enforcement should encourage more compliance and, if using a risk-based approach, would mean fewer non-compliant operators to target.
19: Including Area Knowledge Certificates, and which passenger service licence a driver is operating under.