The Taxi Trade Throughout the Coronavirus Pandemic
The Coronavirus pandemic has had a huge impact on businesses across the UK. The closure of hospitality sectors, recreational venues and educational systems has meant many businesses have suffered, and one industry that has especially struggled is the taxi trade.
Following the recent government announcement on Monday 22nd February 2021, there seems to be light at the end of this very long tunnel, but we’re taking a look at how this past year has affected the taxi industry and what the new roadmap out of lockdown means for taxi companies and their drivers.
Financial Impact
There has been a decrease in the need for taxis since the lockdown was put in place. Places like pubs, restaurants and nightclubs are key industries related to the taxi trade, and with these being closed, it’s meant no one has needed to use taxis as often as they normally would.
William Flynn, the owner of City Cars in Glasgow and a loyal Taxi Centre customer, said: "I would have to say the last 12 months have been the most challenging for the taxi trade. With lockdown, nothing has been open for people to go to, resulting in taxis not being needed. Drivers are struggling to make ends meet simply because of the lack of customers, but still, have payments to make. Companies are finding it extremely challenging as a number of them have fleets of vehicles parked up and little sign of getting any drivers soon.”
In an interview with the BBC, Nahid Chowdry, a taxi driver in Solihull, explained how lockdown meant “work was completely dead” and only made £15 one morning. He has had to resort to claiming Universal Credit to help support himself and his family but explained how most of this goes on insurance costs.
It hasn’t just been taxi drivers and companies in England that have felt the impact of the lockdown. Taxi businesses in Scotland, Wales and Northern Ireland have also suffered.
Eamon Crowe, who has worked for 40 years in the taxi trade in Scotland, explained to the BBC that “it could be the end of the taxi trade,” with many livelihoods at risk.
It took a long time for the Government to come up with a package to help taxi drivers, with many feeling that it wasn’t enough to cover their losses. The RMT – a union for transport workers – predicted around 80,000 taxi drivers from across the UK were in serious danger of suffering financially because of the lockdown.
The Self-Employed Income Support Scheme was put in place to ensure taxi drivers could claim 80% of their earnings. However, they were unable to claim until June, which meant that many went for 3 months without any financial help.
In Scotland, the Finance Secretary, Kate Forbes, said: “We know how difficult this pandemic has been for taxi drivers and their families. They’ve truly gone the extra mile, continuing to provide a vital service for key workers and vulnerable individuals throughout the lockdown and beyond. I have trebled the budget originally announced for this fund to £57 million, enough to provide grants of £1,500 to all of Scotland’s 38,000 taxi and private hire drivers. It will help to support the taxi trade by augmenting existing support and assisting drivers in meeting fixed costs including licence plate fees, rental fees and insurance payments for taxis not on the road.”
Increase in Taxi Licenses
Another factor that has caused significant pressure on the taxi industry is the increase in taxi licenses. In England, the number of taxi licenses hit an all-time high in 2020, which could be due to many people facing unemployment and turning to taxiing as a means to support their families. However, this has caused more competition at a time when customer needs are at an all-time low.
The Future of the Taxi Industry
After the announcement on Monday 22nd February 2021, a clear roadmap out of the current lockdown has been put in place, with hospitality industries, schools and other businesses set to reopen from 12th April 2021. People across the UK are eager to get back socialising, schooling and travelling to see loved ones, creating much-needed work for the taxi trade.
William Flynn, the owner of City Cars in Glasgow and a loyal Taxi Centre customer, said “The trade will pick up very quickly once this pandemic is brought under control and we get back to some kind of normality. Pubs, restaurants, nightclubs etc will create the amount of work we would have normally seen around the festive period as people get out and enjoy themselves - let’s hope it’s soon"
Until then, self-employed businesses including taxi drivers may be eligible for the Self-Employment Income Support Scheme Grant Extension. For more information and to find out how much you could claim, click here.