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Consultation to Clarify Rules Governing Community Transport Operators

Following a legal challenge from the Bus and Coach Association, the Department for Transport opened a consultation on 8th February 2018 on the scope and use of Section 19 and Section 22 permits.

Sections 19 & 22 of the Transport Act 1985 permit organisations which operate on a not-for-profit basis to obtain permits exempting them from the requirement to use their vehicles under an Operator’s Licence (and so avoid the obligations that are made conditional upon the grant of such licences).

PSV O Licence Holders Concerns

There has long been concern among some PSV operators that the legislation permitting Community Transport Operators to run their vehicles under permits has led to abuse; most obviously in cases where the holders of permits compete for – and crucially win- work that would otherwise be awarded to O Licence holders, thereby leading to complaints of an uneven playing field that favours the interest of permit holders.  O Licence holders complain that if they must hold an O Licence in order to service such work it cannot be right that non O Licence holders should be permitted to win and run such work while operating under a less onerous regulatory regime.

The consultation aims to amend the Transport Act 1985 so that permits are only awarded to organisations which satisfy the “exempt bodies” criteria of EU Regulation 1071/2009, so that permits become invalid as soon as the organisations to which they have been granted no longer satisfy the relevant criteria.

Greater Clarification with New Guidance

The Department for Transport’s proposal aims to provide guidance on those organisations that are eligible to run vehicles under Section 19 and Section 22 permits, while also working with the DVSA to ensure that a proportionate approach is taken to the enforcement of the amended legislation.  The proposed new guidance aims to clarify exactly what the requirements for a “non-commercial exemption” are, details of which can be seen on the Government website via the link here.

The Department for Transport say that they hope that through these amendments, and their efficient enforcement, they will be able to ensure that the permit system is not misused, and indeed that it continues to be used as it should be; i.e. as a means of offering a beneficial service to (often disadvantaged) members of the local community but without adversely affecting the livelihoods of O Licence holders.  The effect of this amended regime should be to help address the long-held concerns in the transport industry that permit holders are obtaining an advantage that is both unlawful and innately unfair…

The Department for Transport has also reiterated its support for Community Transport Operators and their philanthropic endeavours, and has announced that, through the Bus Service Operators Grant, they will be offering around £3.5 million in financial support in this financial year.

Next Steps?

The overall impact for the transport industry ought to be positive, with fairer competition (such as it may be) between public and private sector operators, and clearer guidance to follow for Community Transport Operators.  The changes (if and when they come into force) mean that organisations likely to be affected (i.e. Section 19 and 22 permit holders) will need to review the new proposed legislation and its likely impact in good time so as to make any changes that are needed before the new regime bites (this is especially so where new O Licences must be obtained and the O Licensing compliance regime put in place so as to continue operations hitherto carried on under permits).

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