Source: https://oag.govt.nz/2005/taxis/part3.htm
Timestamp: 2019-11-19 05:05:46
Document Index: 649979547

Matched Legal Cases: ['art 3', 'art 3', 'art 2', 'art 4', 'art 5', 'art 6', 'art 7', 'art 8', 'art 3', 'art3', 'art 6', 'art 7', 'art 6', 'art 7', 'art 4']

Part 3: Controls over entry to the taxi industry — Office of the Auditor-General New Zealand
Part 3: Controls over entry to the taxi industry
Part 2: The taxi industry framework
Part 4: The Authority’s monitoring and enforcing compliance of the taxi industry
Part 5: Monitoring by other agencies
Part 6: Consistency of the compliance function
Part 7: Changes in the land transport sector
Part 8: Consumer awareness and the Operator Safety Rating System
Part 3: Controls over entry to the taxi industry Effectiveness of controls over the taxi industry. https://oag.govt.nz/2005/taxis/part3.htm https://oag.govt.nz/@@site-logo/logo.png
Effectiveness of controls over the taxi industry.
Agents of the Authority, compliance staff in the regional offices, and staff of the Authority’s Transport Registry Centre (see paragraph 2.57) all exercise controls over entry to the taxi industry. Agents gather data but do not approve applications. This is the role of the compliance staff in the Authority’s regional offices.
The Authority also approves the providers of courses and an examination that applicants must complete to gain entry to the taxi industry, and approves the course content. The passenger endorsement and area knowledge course are for taxi drivers, while the Certificate of Knowledge of Law and Practice examination is for passenger service licence holders.
We considered the Authority’s Statement of Intent 2004/2005, which sets out the services to be delivered by specific output classes, and the transport legislation relevant to the taxi industry, and then prepared our expectations. We assessed the Authority’s performance against those expectations.
In this Part, we discuss the Authority’s entry controls and suggest areas for improvement. In particular, we cover:
controls exercised by the Authority’s agents;
fitness and propriety assessments by compliance staff;
ability to cater for applicants born overseas;
approval of taxi organisations;
applications for a passenger service licence;
applications for an endorsement to carry passengers;
approval of course providers; and
other entry control issues.
We expected applicants with a history of any serious crimes, or a history of repeated offending, to be precluded from entering the taxi industry. We did not look at the adequacy of individual decisions (where the Director of the Authority and delegated Authority staff exercise their discretion), in assessing the Authority’s performance against this expectation.
Instead, we focused on the procedures used in arriving at decisions, and the consistency of their use between the Authority’s regional offices, to assess whether there was any risk that unfit or improper people could enter the taxi industry. Our findings in relation to this expectation are discussed in Part 6 (because there is inconsistency in the decision-making procedures), and Part 7 (because proposed legislative changes may make a difference).
We expected the Authority’s agents to have clear guidelines to follow when checking whether an applicant for a passenger endorsement had satisfied all statutory requirements, before the application was submitted to the Authority for a fit and proper person assessment.
We also expected the Authority (or its agents) to obtain and retain proof that an applicant had satisfied the requirements for a passenger endorsement.
Controls exercised by the Authority’s agents
The Authority uses agents to deliver services on its behalf. Most of the work carried out by agents either is in an electronic format or involves collating information for forwarding to the Authority. When agents receive an application, they use the same Authority-generated cover sheet to ensure that consistent information is provided to the Authority. Agents send collated information to the applicant’s nearest Authority regional office for approval.
The agents enter into the Driver Licence Register some of the information an applicant must provide to obtain a passenger service licence, passenger endorsement, and driver identification card, and collect the applicable application fees. The electronic system is designed to prevent an agent continuing with the application without first entering the required information.
The work of agents is largely administrative. If agents have questions, they can refer to a manual provided by the Authority, or call an 0800 telephone number.
The application form for passenger endorsements includes space for applicants to enter a “unique identifier” for their driver identification card (for example, “Martin 1”). Agents enter the unique identifier, specified by an applicant on their application form, into the Driver Licence Register. Unique identifiers are not permanently assigned to a driver, and can be changed whenever the driver chooses.
Section 19 of the Transport Services Licensing Act 1989 requires unique identifiers to be memorable enough to be easily recalled by users (passengers). The Authority requires that unique identifiers are not more than 8 characters long, and not offensive. However, agents do not stop applicants from choosing entirely numerical14 identifiers. In our view, this undermines the intent of the legislation, which is to have an identifier that a passenger can easily remember when making a complaint, either to the taxi organisation or the Authority.
We recommend that Land Transport New Zealand ensure that it only approves unique identifiers that would be easily recalled by passengers.
Fitness and propriety assessments by compliance staff
Compliance staff in the regional offices approve applications made by those seeking to manage a taxi organisation, hold a passenger service licence, or gain a passenger endorsement to drive a taxi. One of their main tasks is assessing an applicant’s fitness and propriety.
The Director of the Authority is responsible for deciding whether an applicant is fit and proper. The Director delegates this power15 to particular compliance staff in the regional offices. In all but one region we visited, Regional Compliance Officers allowed Compliance Officers and others to exercise their delegated power to approve applications.
Compliance staff check an applicant’s traffic offending record through the Authority’s database, and get further information on criminal and traffic convictions from the Licensing and Vetting section of the Police. While the Authority has a compliance manual to guide the activities of compliance staff, staff knowledge and use of the manual was limited (discussed further in Part 6).
The Police have advised that, because of the current wording of the Authority’s application form for passenger endorsements, they do not provide the Authority with all the information they hold about an applicant, other than convictions. The Police have identified people they consider unsuitable for roles where members of the public may be at risk.
After considering a wider range of information than a person’s conviction history, the Police may place a “red stamp” on a person’s Police check record. The stamp states–
Police recommend this person does not have unsupervised access to children, young people, or more vulnerable members of society.
Organisations such as the Teachers’ Council use the “red stamp” check when looking into the background of prospective teachers.
The Authority was not aware of the “red stamp” process, but noted that advice of the stamp’s presence would be insufficient. The Authority says that to properly consider an applicant’s fitness and propriety, compliance staff would need to know what information had led the Police to use the “red stamp”.
The Police advised us that using the “red stamp” check would not cost the Authority more, and would not increase the time taken to provide a Police check. The Police believe that they cannot provide “red stamp” information, because the consent form signed by an applicant for a passenger endorsement allows the Police to release information only about the applicant’s convictions.
However, section 24(4) of the Transport Services Licensing Act 1989 allows the Director of the Authority to seek and receive such information as he or she sees fit, and to consider information from any source.
The Authority could, in our view, use the power under section 24(4) to seek the information about an applicant that leads to a “red stamp”, without amending the consent form. However, it would be preferable to amend the consent form, so that applicants are fully aware of the extent of information about them that might be disclosed.
We recommend that Land Transport New Zealand, when assessing an applicant’s fitness and propriety, obtain consent for the Police to disclose any information they might hold about the applicant.
Apart from providing the information about convictions, the Police are not involved in the fit and proper person assessment.
When people apply for new or renewed licences and endorsements, they expect timely service. This is especially true for commercial drivers and operators, because application delays can affect their ability to earn an income. The time taken by the Authority to consider an application is affected by the time it takes the Police to check a person’s criminal or traffic conviction history.
During 2003-04, the timeliness of Police checks decreased, so that only 55% of checks were completed within 30 days, against a performance target of 95%. The reasons for the decrease included an increase in demand for Police checks in several other sectors (including education). The Manager of the Police’s Licensing and Vetting section advised us that the section had received more resources to deal with the demand, and this has reduced processing to below 30 days.
The Authority’s Memorandum of Understanding with the Police does not cover the timeliness of checks done on the Authority’s behalf. However, to meet its own targets for dealing with transport service licence applications, the Authority does not count the time spent waiting for the Police to carry out its check. We recognise that the Authority cannot control how long the Police take. However, this approach means the time to deal with an application can, and has, differed markedly from the time recorded by the Authority.
We recommend that Land Transport New Zealand include a performance measure in its Statement of Intent for the total elapsed time taken to deal with applications.
We recommend that Land Transport New Zealand and the Police amend their Memorandum of Understanding to include timeliness measures for the provision of Police vetting checks.
When the Authority assesses whether a person is fit and proper, it must consider a number of matters, including complaints, and any history of mental health or behavioural problems.
Applicants must get a doctor to assess their medical fitness to drive, and to complete a medical certificate. The medical certificate includes a question about whether the applicant has, in the last 5 years, had or been treated for several conditions, including mental illness. However, none of the files we examined showed the Authority had looked at mental health issues or behavioural problems of applicants, as required by the Transport Services Licensing Act 1989.
In practice, when assessing fitness and propriety, the Authority looks at a person’s criminal and traffic offending history. If anything significant arises, it considers undertaking further enquiries. This approach may be sufficient in many cases, but it does not comply with the legislation in that particular matters must be considered.
We recommend that Land Transport New Zealand record, as part of the fitness and propriety assessment, that it has checked an applicant’s medical certificate to see whether they have, or have been treated for, a mental illness.
False statutory declarations
Applicants are required to make a statutory declaration on their application form about whether they have committed any offences, and whether they have any charges waiting to be heard in court. Some applicants falsely declare that they have no convictions or cases pending. As the Authority gets an applicant’s complete Police record, the Authority can easily discover when an applicant has made a false declaration.
In most such cases, the Authority had not taken any action against the applicant. However, in our file reviews, there were 5 instances where one regional office sent warning letters to applicants about making a false declaration. The Authority took no other action against these applicants.
We recommend that Land Transport New Zealand ensure that all regional offices adopt a consistent approach to warning, or prosecuting, applicants who knowingly make false declarations on their application form about previous convictions or charges awaiting hearing.
In cases where the decision to grant an application is difficult to decide, the Authority may interview an applicant to seek further information, particularly the background to their criminal convictions.
It may also, or instead, grant an application on a “without prejudice” basis. Authority staff call this a “WoP”. A WoP warns the applicant that, if they commit further offences in the next 12 months, they risk having their endorsement or licence revoked, or not having their endorsement renewed. The WoP has no formal legal standing.
Use of the WoP varied significantly between the 7 regional offices. The total number of WoPs issued during the 3 financial years from 2001-02 to 2003-04 was 1211. The regional office totals ranged from zero (2 offices did not issue any WoPs) to 588.
We recommend that Land Transport New Zealand establish guidelines for the use of the “without prejudice” tool, so it is used consistently and appropriately.
Ability to cater for applicants born overseas
During the fit and proper person assessment, Compliance Officers or Compliance Support Officers contact the New Zealand Immigration Service to obtain the immigration status of applicants who were born overseas. While most regional offices do not record how many immigration checks they seek, the Authority estimated that they ask the New Zealand Immigration Service to complete about 750 checks each year. The purpose of the check is to ensure that the person is legally able to work in New Zealand.
Our file reviews included 6 applications (5% of the new application files we examined) where immigration checks were not completed when they should have been.
Certain student permit holders are allowed to undertake paid employment for up to 15 hours a week.16 Because the Authority’s immigration check looks only at a person’s immigration status (that is, whether they have a permit), it does not necessarily disclose whether a person is on a student permit that allows them to work. Despite this, the Authority grants endorsements to student permit holders.
The Authority will issue a passenger endorsement if the immigration check shows that a person’s permit17 is current when they apply, even if it is going to expire before the term of their passenger endorsement. Clause 61 of the Land Transport (Driver Licensing) Rule 1999 provides that passenger endorsements may be issued for one year or 5 years. The Authority does not have the discretion to issue a passenger endorsement for the period of a person’s permit.
The Authority issues endorsements for 5 years when a work permit is valid for less than a year, rather than limiting the endorsement to one year. During our file reviews, we found one case where the Authority granted a passenger endorsement to an applicant for 5 years from March 2004, but their work permit expired in September 2004.
Some Authority staff advised us that, if a permit was going to expire soon after the application for a passenger endorsement had been made, they would not grant the application until the applicant produced a further permit. However, during our file reviews we found an application where the Authority issued a one-year passenger endorsement, even though the applicant’s permit was valid for only another 16 days.
We recommend that Land Transport New Zealand seek an amendment to the Land Transport (Driver Licensing) Rule 1999 to allow Land Transport New Zealand to grant endorsements for a period that coincides with the expiry of a person’s immigration permit.
In at least one regional office, compliance staff sent requests for immigration checks to the border control and deportation section of the New Zealand Immigration Service. This section does not deal with applications for temporary permits or residency – the Service’s branches do. Border control immigration staff do immigration checks by looking up the person’s immigration status in the Service’s database. However, the case manager at the branch may have gathered more details about an applicant, but not yet entered the information into the database. When this happens, complete information is not provided to the Authority.
We recommend that Land Transport New Zealand formalise its relationship with the New Zealand Immigration Service, to ensure that Land Transport New Zealand receives complete and timely information about overseas-born applicants.
Driving experience in New Zealand
A person with an overseas driver licence is legally considered to have a New Zealand licence from the time they enter the country. Under the Authority’s driver licence conversion process, if immigrants had been fully licensed for more than 2 years, they met the requirement to have held a full New Zealand driver licence for 2 years, regardless of how recently they may have arrived.
According to the Authority, 1094 people qualified for licence conversion and gained their passenger endorsement between 2002 and 2004. Of these, 745 (68%) were likely to be taxi drivers, because they had a driver identification card and did not hold a driver licence for vehicles other than cars.
In the new application files we examined, there were 16 cases (14% of new applications reviewed) where the overseas licence conversion process had allowed applicants who had been in New Zealand only a short time to obtain passenger endorsements.
The Authority changed this process in December 2004, after seeking a legal opinion. While a person’s overseas driver licence is still considered a New Zealand driver licence when they enter the country, the person must go on to hold that licence for at least 2 years. Before one year has passed, the applicant must convert his or her overseas driver licence to a New Zealand driver licence. At the end of their second year, they will meet the requirement that prospective taxi drivers must hold, and have held for at least 2 years, a full driver licence.
In a memorandum to the Ministry of Transport, the Authority acknowledged that the previous approach presented several risks. It did not ensure that passenger endorsement applicants were sufficiently familiar with New Zealand’s road rules and driving environment before working in the transport industry. The Authority noted that a higher standard of driving is expected of occupational drivers.
Prospective taxi drivers will now have 2 years in New Zealand to become accustomed to local driving conditions, and will have longer to gain area knowledge. This change will meet the Taxi Federation’s wish that drivers should spend some time in New Zealand before becoming a taxi driver.
International Police checks
When assessing fitness and propriety, the Authority uses the same procedures for immigrants as it uses for other applicants. A Police check reveals any New Zealand criminal and traffic offending, but usually no attempt is made to get details of offending from the applicant’s country of origin. The Authority relies on the immigration check as evidence that an applicant who was born overseas was considered fit and proper when they entered New Zealand.
However, the New Zealand Immigration Service advised us that immigrants who are granted permits to be in New Zealand for less than 24 months are not subject to Police checks for any countries they lived in before arriving in New Zealand.
Because most student permits are for an academic year, students are not subject to Police checks in their country of origin. The Authority has no overseas history to draw on when assessing the fitness and propriety of these applicants. The same issue arises for work permits that are issued for less than 24 months.
In our application file reviews, there were 7 examples (6% of the new applications we examined) where applicants were in New Zealand on student or temporary work permits of less than 12 months’ duration.
The requirement, from December 2004, that applicants for a passenger endorsement have 2 years’ experience driving on New Zealand roads, will mean that fewer immigrants on temporary permits will be able to become taxi drivers. However, it will still be possible for applicants to avoid a thorough Police check, because temporary permits can be renewed.
We recommend that Land Transport New Zealand obtain as much information as possible on the criminal history (if any) of applicants with temporary immigration permits, to ensure that they are fit and proper.
Approval of taxi organisations
Many stakeholders we spoke to, including Authority staff, staff of the CVIU, and taxi organisation representatives, expressed concern that it is too easy to set up a taxi organisation.
When the Authority considers requests to approve a taxi organisation, the only requirement is that those who will (or are likely to) control the organisation be fit and proper. Under legislation, the Authority is not directed to consider the applicant’s experience, or knowledge of taxi industry rules and regulations.
In our view, those who control a taxi organisation need to be aware of their obligations. Taxi organisations and passenger service licence holders have a continuing relationship with taxi drivers, and are best placed to influence them. Those operating taxi organisations need to be capable of providing guidance to drivers about the drivers’ obligations.
The Certificate of Knowledge of Law and Practice was introduced to help ensure that people operating transport services were adequately prepared, and aware of their legal responsibilities.
A survey by the Authority in 1994 found that 75% of the surveyed Certificate holders considered the knowledge gained from completing the Certificate to be useful. A similar qualification could be introduced as a requirement for those who wish to control a taxi organisation. This would help to ensure that directors have adequate knowledge of the rules and regulations that apply to their taxi organisation, to passenger service licence holders, and to drivers. The Land Transport Amendment Bill (see Part 7 of this report) makes provision for such a course.
We recommend that Land Transport New Zealand require those who wish to control a taxi organisation to complete a course equivalent to the Certificate of Knowledge of Law and Practice.
Applications for a passenger service licence
Compliance staff check that an applicant for a passenger service licence has complied with all the relevant requirements, such as:
providing copies of the 2 separate Public Notice newspaper advertisements;
successfully completing an examination to gain a Certificate of Knowledge of Law and Practice (unless someone who has, or is to have, control of the transport service has already obtained a Certificate);
providing the required details on those seeking the passenger service licence;
paying the fees; and
having the application forms signed by a Justice of the Peace (or other person authorised to witness statutory declarations).
Compliance staff then assess the person’s fitness and propriety.
The Authority has produced a fact sheet about transport service (including passenger service) licences. In our view, this fact sheet does not contain enough information for a driver to determine if they need a passenger service licence, or to identify their obligations if they do require one.
Determining whether a passenger service licence is required can be complicated, and the Authority could do more to educate the industry about when a passenger service licence is required.
We note that the IRD has produced information specifically for taxi drivers, to inform them of the tax requirements that arise in some of the common arrangements between taxi vehicle owners and drivers. The Authority’s fact sheet could also refer to the IRD information and provide contact details.
We recommend that Land Transport New Zealand produce a fact sheet specifically for taxi drivers, that explains how drivers determine if they must hold a passenger service licence.
The legislation dealing with the fit and proper person assessment of applicants for passenger service licences requires a 2-stage assessment. The Authority is required to assess whether the applicant is fit and proper to operate a passenger service. It is then required to assess whether those who will be in control of the passenger service – which may or may not be the applicant – are fit and proper to control a passenger service.
Applications for an endorsement to carry passengers
Before a prospective taxi driver is issued with a passenger endorsement on their driver licence, the applicant must have:
been assessed by compliance staff as a fit and proper person to carry passengers in a motor vehicle;
shown the Authority’s agent their passenger endorsement course certificate;
provided a medical certificate (or have done so in the last 5 years, unless their health has changed since);
sat a practical driving test (unless the applicant has passed one in the last 5 years); and
paid the required fees.
The Authority’s agents collect the fees, book the driving tests, sight or collect the certificates, enter details into the Driver Licence Register, and send applications to the applicants’ nearest Authority regional office for approval.
Document storage practices varied between the regional offices. Most kept applications for one year, then destroyed them. The Authority stated that its policy for document retention was that all driver licence forms in the regional offices would be stored for 12 months, and then destroyed. The Authority recognised that some offices retain documents for longer periods, and agreed with our position that all offices should follow a consistent approach.
All regional offices used some form of cover sheet for applications, to check that applications met statutory requirements. However, only one of the cover sheets from the 4 offices that we visited covered all the statutory requirements for becoming a taxi driver.
The lack of a comprehensive cover sheet to ensure a systematic check of all the relevant statutory requirements had a significant effect. Twenty percent of the new applications we examined (that is, 23 applications) did not contain proof that all the legislative requirements to gain a passenger endorsement had been met (such as evidence that a passenger endorsement course had been completed). The Authority must be able to show that approved applicants have met the statutory requirements.
We recommend that Land Transport New Zealand produce a standardised cover sheet for applications, which includes all the statutory requirements, to ensure that approved applicants meet all the statutory requirements.
The IRD has produced a brochure for taxi drivers on their tax obligations. While the IRD clearly has responsibility for monitoring and enforcing driver compliance with those obligations, the Authority’s fact sheets do not contain any reference to the IRD’s information. We consider that a close relationship with the IRD would facilitate better compliance in the taxi industry.
We recommend that Land Transport New Zealand establish a close relationship with the Inland Revenue Department, to help ensure that taxi drivers are aware of their tax obligations, and add references to the Inland Revenue Department’s information in applicable Land Transport New Zealand fact sheets.
Approval of course providers
Prospective taxi drivers must, among a number of requirements, successfully complete courses for a passenger endorsement and Area Knowledge Certificate(s). Anyone can apply to provide these courses. We describe below the approval process for each type of course, and then comment on the Authority’s role in approving course providers. We also discuss the process for approving the provider of the Certificate of Knowledge of Law and Practice examination (it differs from the other courses, because there is only one provider).
Approving the providers of passenger endorsement courses
Providers of passenger endorsement courses can be registered with the New Zealand Qualifications Authority to conduct unit standard assessments, or provide non-unit standard courses. To be approved by the Authority, all providers must be registered and accredited as an assessor by the New Zealand Road Transport and Logistics Industry Training Organisation (ITO). The ITO establishes and manages qualifications, training resources and assessments, and allocates training subsidies in the transport and logistics sectors.
The Authority can approve organisations (for example, Salvation Army Employment Plus) or individuals as the providers of passenger endorsement courses. The Authority has compiled a document for course providers, containing all the conditions of their approval. The conditions have been strengthened to give the Authority more powers, and place additional obligations on course providers. We discuss that document further in Part 4.
Before 1 October 2004, the Authority did not exercise any control over those who conducted training and assessment under an organisational approval, relying instead on the organisation to maintain individual standards. Unless the organisation maintained an accurate register of assessors, the Authority did not know who was conducting assessments.
The Authority estimated that, in August 2003, there were 106 approved organisations, employing or contracting 318 assessors. In changes phased in between 1 October 2004 and 31 January 2005, the Authority began to approve, within the provider organisations, every individual who was conducting assessments.
Education and compliance staff within the Authority have expressed concern about the approval system for course providers. In particular, concerns have been raised about the knowledge a course provider must have, and whether they should all hold a passenger endorsement before they can provide training. Course providers using the unit standard and ITO process must be passenger endorsement holders, but non-unit standard providers do not have to meet this requirement.
Passenger endorsement courses for taxi drivers
Each type of passenger endorsement course consists of 2 modules, assessed through open book, multiple-choice tests.
Unit standard providers conduct standards 17579 (Demonstrate Knowledge of Driver Licensing Requirements for Endorsement P (Passenger)), and 15164 (Demonstrate Knowledge of Driving Hours and Complete Driving Hours Logbook). Non-unit standard providers conduct a specialist module on the passenger endorsement, and a general one on logbooks.
The unit standard module on passenger endorsement licensing includes information on the legal requirements for passenger services, and the duties and conduct required of drivers of small passenger service vehicles.
The unit standard driving hours and logbook module includes information on the driving hours’ provisions prescribed in sections 70B (driving hours), 70C (driver logbooks), and 70D (offences and proceedings concerning logbooks and driving hours) of the Transport Act 1962, and the custody, maintenance, production, and completion of logbooks. These sections are to be amended and incorporated in the Land Transport Amendment Bill.
While the non-unit standard providers’ modules cover the same general issues as the unit standard providers, there are practical differences between the assessments, for example, the use of different logbook formats.
The Authority needs to determine what is an appropriate format for driver testing. Some people we spoke to question the use of open book tests, and one suggested a closed book format was more appropriate in a regulatory environment. Regardless of the format, the course content must be consistent, and delivered to a consistent standard. Using 2 different types of provider means that courses are not offered to the same standard.
The Authority has not assessed the knowledge retained by drivers after time in the industry. Assessing the level of knowledge among drivers would assist in assessing the effectiveness of the existing courses, and indicate areas where industry re-education could be useful. The Authority could then consider whether it should require drivers to complete refresher training.
Passenger endorsement certificates do not have expiry dates. It is possible to complete a course and obtain a certificate, yet not present that certificate to the Authority, as part of the application for a passenger endorsement, for a long time. We saw one example where the certificate was issued in April 2001, but was not presented to the Authority until May 2004. This brings into question the currency of the applicant’s knowledge of applicable legislation.
We note that there is a possibility of amending the Land Transport (Driver Licensing) Rule 1999, to have a 6-month limit between completing the course and presenting the certificate. We support the concept of an expiry date to ensure that the applicant’s knowledge of passenger endorsement requirements is current when the person applies for a passenger endorsement.
We recommend that Land Transport New Zealand consider placing an expiry date on the certificates issued after successful completion of a passenger endorsement course.
The current licensing process for the taxi industry has been criticised as inadequate and disjointed. There are several separate requirements to be met before a person obtains a passenger endorsement. If the requirements were combined, paperwork and costs could be reduced. Several course providers suggested that prospective taxi drivers should complete one condensed programme, covering all aspects of the industry and the obligations of individual drivers. It would include, for example, a component on tax obligations.
In one overseas jurisdiction, a review of taxi driver training in late-2002 led to an increase in the training requirement for taxi drivers, from 40 hours to 90 hours. The new course includes modules about customer service, carrying out financial transactions and maintaining records, and driving a taxi.
In another overseas jurisdiction, prospective drivers must complete a course of 8 modules to obtain a 12-month provisional taxi licence, then complete further training before obtaining a full 3-year taxi licence.
Some New Zealand course providers already supply more information and training to candidates than is required to gain a passenger endorsement course certificate.
We recommend that Land Transport New Zealand review how and when passenger endorsement courses are delivered, to ensure that they:
follow a consistent teaching method;
are of a consistent standard;
are easily audited;
follow a format that improves driver knowledge and compliance with obligations;
allow for refresher driver training after a certain period in the industry, if the Director considers it necessary; and
are sufficiently comprehensive.
Approval of area knowledge course providers
Before a person can drive a taxi, they must hold an Area Knowledge Certificate(s) for the area(s) in which their taxi organisation operates. Taxi drivers are issued with an Area Knowledge Certificate after passing an area knowledge test.
There are different tests for metropolitan areas (for example, Auckland, North Shore, Hamilton, Wellington, Lower Hutt, Christchurch, and Dunedin), and nonmetropolitan areas. The metropolitan test covers 8 objectives, and the nonmetropolitan test covers 10 (see the Appendix, which sets out the objectives for the area knowledge tests).
The tests are administered by entities approved by the Authority as area knowledge course providers.
Anyone can apply to become a provider of area knowledge courses. In some regions, the Authority assists applicants by providing them with information packs, including criteria and objectives for the test. The applicants then prepare their own test, satisfying the criteria and objectives, for approval by the Authority. The Authority may also check other aspects of the application, including the physical layout of the proposed testing venue, before it approves the course provider.
About one-third of the providers of area knowledge courses are taxi organisations. A conflict of interest exists, as these organisations often want more drivers, and obtain their income from those drivers. To address this conflict, the Authority is considering adopting a system where there is a small number of area knowledge testers (or a single tester). Anyone could still be approved to prepare applicants to sit the test. Such a system would remove the conflict of interest, without adversely affecting the financial viability of course providers (which is a concern for the Authority).
The Authority has initiated a project to review the delivery mechanism for area knowledge courses. The Authority has not looked at this before, because it was not considered a safety risk. The review was a response to evidence of fraudulent Area Knowledge Certificates, and the conflict of interest that occurs when taxi organisations offer the course to prospective drivers. The review was to be completed in December 2004, but has not yet been completed.
The Authority is proposing that taxi drivers in metropolitan areas be required to hold Area Knowledge Certificates for the entire metropolitan area in which they work. This may help in improving the area knowledge of drivers, if the test is robust enough, and if the method of course provision is improved.
One course provider suggested that the Authority should approve the programme of the training courses, as well as the test used. The provider believed this would help to reduce the number of instances where candidates are poorly trained, but able to write out answers to the test questions from memory, and without understanding them.
Some course providers noted that, in their experience, a driver ’s compliance depended more on the quality of the taxi organisation they worked for than the quality of the course they attended. While a course is completed once at entry to the industry, a taxi organisation has an ongoing influence on behaviour.
Content of area knowledge courses
The Authority’s fact sheet, Taxi drivers and Area Knowledge Certificates, states that the Area Knowledge Certificate “says that you have a good knowledge of the area or areas your taxi organisation works in, and that you’ve got a good understanding of the English language.” The Authority advised us that the Certificate proves that a person can get to and from major locations, and read a map.
The standard of English language required is not easy to define or assess. Instead of a separate test, English language ability is assessed by whether the applicant can answer the area knowledge test in English. The Authority has advised us that, while the applicant must complete the test in English, they do not have to be competent in English. This is contrary to the Authority’s fact sheet.
Responsibility for ensuring that drivers maintain an appropriate ability to communicate in English sits with taxi organisations. The Authority believes that the area knowledge test covers most of the language skills required. The Authority does not require applicants to complete a separate English language assessment, as it believes this would impose an unnecessary additional cost on those who speak fluent English. Other jurisdictions overseas require applicants to pass a separate English literacy test.
In our view, competency in English, and not just the ability to answer the area knowledge test in English, must be an entry requirement. If competency is not required at entry then it is difficult for an employer to satisfy the legislative requirement to ensure that their drivers “maintain an appropriate ability to communicate in the English language.” Further, if a driver is not competent in English, this increases the risk of miscommunication and misunderstandings with passengers.
We recommend that Land Transport New Zealand review the effectiveness of having English language ability assessed as part of the area knowledge test.
From 30 September 2002, after consultation with the taxi industry, the Authority introduced changes to the content of the area knowledge test for the main metropolitan areas.18 The main change was the introduction of a map-reading component. The Authority intended to increase auditing of area knowledge course providers to 10% of the providers each year, but this has not happened.
Several people we spoke to said that the content of the test is inadequate for area knowledge and English language competency, and does not assess taxi drivers to the standard that most consumers expect.
Some Authority staff, and taxi organisations, believe that many public complaints about area knowledge and English language ability are racially motivated, and that when the complaints are investigated, they are usually found to be baseless. Nevertheless, concerns were raised that answers to the test can be memorised, which negates its value as a test of area knowledge and English language ability. Answers can be memorised because a list of possible questions and answers for the test is provided to applicants before they sit the test.
During our audit, we were told many times about drivers having inadequate area knowledge and English language skills. We observed this during a meeting with a taxi organisation’s manager, who continued to dispatch taxis while talking to us. It was clear that the manager was dealing with some drivers in his fleet who did not know how to find main streets, or where well-known suburbs were.
Many taxi organisations conduct their own, more stringent area knowledge test before employing a driver, as they are not willing to rely on the completion of an area knowledge course as proof that a driver has adequate area knowledge. Such “permit” tests also often include a practical driving test. The taxi organisations that used such a test thought that the Authority’s area knowledge test should include a driving component. However, the Authority believes that the cost of requiring such a test outweighs the benefit.
Approval of the provider of Certificate of Knowledge of Law and Practice examination
The process used to approve the provider of the Certificate of Knowledge of Law and Practice examination differs from that used to approve the providers of the other courses.
There is only one provider of the Certificate of Knowledge of Law and Practice examination. In 1996, this provider won a tender to conduct the course for an initial term of 3 years, with an option to renew for a further 3 years. The contract expired in 2002, but was rolled over for 2 terms of 12 months.
The Authority conducted a new tender round in December 2004, and the provider was again successful. The new contract is for a term of 3 years, to 31 December 2007.
Other entry control issues identified during our audit
Medical certificates do not have to be completed by the applicant’s usual doctor
Some Authority staff suggested that an applicant should be permitted to go to only their usual doctor to obtain the medical certificate that is required for a passenger endorsement. A person’s usual doctor would be best placed to assess the applicant’s medical status, and should have access to a person’s full medical history. Without access to this medical history, a doctor would not necessarily be able to answer the question about a person’s mental health during the last 5 years (see paragraph 3.29), which must be considered as part of the fitness and propriety assessment. However, we recognise that some applicants will not have a “usual” doctor, so enforcement of such a requirement would be difficult.
Medical certificates are valid for a 5-year period. However, their expiry often does not coincide with the expiry date for a person’s driver licence or endorsement. A person’s medical certificate might expire shortly after their licence or endorsement, but they are still able to renew their licence for up to 5 years. In this situation, the medical is still “current” for licensing purposes, although there is debate about whether an updated medical should be required before a renewal is granted. This means, in effect, a person can drive a taxi for almost 10 years without being required to get a new medical certificate.
The eyesight requirements are very different. Applicants must have a new eyesight check within 60 days of their application for an endorsement. Drivers therefore have, at most, 5 years before they must have their eyesight checked again.
We note that doctors and optometrists have an ongoing obligation to notify the Authority if, in the interests of public safety, they believe a person should have their ability to drive restricted. The doctor or optometrist must notify the Authority as soon as practicable, in writing, of their opinion and the grounds for it.
We recommend that Land Transport New Zealand consider making the requirements relating to medical certificates the same as those that apply to eyesight checks.
Area Knowledge Certificates are not checked by the Authority
The Authority does not hold information about whether taxi drivers have Area Knowledge Certificates. The Authority states that this is because, at the time of their application for a passenger endorsement, the drivers may not know which organisation they will work for, and which Certificates they will need.
The Authority instead relies on the requirement that taxi organisations must ensure that their drivers hold the appropriate Area Knowledge Certificates. It is therefore possible to get a passenger endorsement and driver identification card without holding any Area Knowledge Certificates. At no point does the Authority require an applicant to present their Area Knowledge Certificates. A possible solution could be to link the requirement to produce proof of Area Knowledge Certificates to the application for a driver identification card (a requirement for taxi drivers).
We found an exception in the Auckland regional office, where staff record in a database details of the Area Knowledge Certificates that drivers hold, using information gained from taxi organisation audits. The rationale for collecting this information is that the Authority would otherwise not collect it. The database holds about 6500 records, which covers most of the fleet in the Auckland region.
We recommend that Land Transport New Zealand require applicants to produce proof of the Area Knowledge Certificates they hold when they apply for a driver identification card.
We were concerned about the lack of controls over Area Knowledge Certificates. Certificates do not have a photograph or signature of the holder. While the Authority individually numbers Certificates to control and monitor their distribution, it does not record these numbers. This means the numbering of Area Knowledge Certificates is not an effective control because Certificates with the same number could be presented more than once to the Authority without its knowledge. It is important that there are robust internal controls linking Area Knowledge Certificates to particular applicants.
We recommend that Land Transport New Zealand record on the Driver Licence Register the individual numbers of Area Knowledge Certificates when they are presented as part of an application for a passenger endorsement or driver identification card.
14: Two examples we saw during our file reviews were “267854” and “83029”.
15: The Director of the Authority is empowered, under section 204 of the Land Transport Act 1998, to delegate his or her functions and powers.
16: Students may be granted a variation of conditions to their student permit, allowing them to work no more than 15 hours a week. They must be undertaking a full-time, long-term course of study, culminating in a recognised diploma or degree, and taking at least 2 academic years to complete, or undertaking a full-time course culminating in a qualification that would attract points under the skilled migrant category of the Residence Policy.
17: There are a number of permits available to people born outside New Zealand. There are temporary student, visitor, and work permits, and residence permits under skilled migrant and family categories.
18: Auckland, Hamilton, Wellington, Christchurch, and Dunedin.
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