Uber's bill for operating in London could be about to rocket with new Transport for London license proposals

Lynsey Barber
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Uber could foot a larger bill under fresh Transport for London proposals (Source: Getty)

Transport for London is eyeing a windfall from Uber to cover the costs of regulating the startup.

The price of Uber securing an operating licence in the capital could jump to more than £2m over five years, compared to a current fee of £2,800, if new rules get the go ahead.

TfL has launched a consultation on its plans to drastically change how it charges for minicab companies to operate. Operators with thousands of drivers currently pay the same as those with just three. The number of private hire vehicles on the roads have jumped by 74 per cent since 2014.

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TfL estimates the enforcement of minicab rules across London is expected to jump to £30m over the next five years as a result, up from previous estimates of £4m. TfL is looking to plug that hole with the operating licence shake up, first put forward by the Mayor of London Sadiq Khan in his action plan for the industry in September 2016.

"It is only fair that licence fees for private hire operators accurately reflect the costs of enforcement and regulating the trade," said Helen Chapman, general manager for taxis and private hire at TfL.

"The changes to fees would also enable us to fund additional compliance officers to help crackdown on illegal and dangerous activity."

A two-tier structure would be replaced with a five-tier one with a maximum fee of £167,000 plus £68 per car for operators with more than 1,000 vehicles.

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Uber currently has 30,000 drivers in the capital and fellow cab firm Addison Lee is also understood to be the second of the two firms in the top bracket for which the highest fees would apply.

TfL, which will no longer be subsidised by the government from next year and must become self-sufficient, expects the new cost structure is still likely to result in a shortfall.

Uber has previously said it broadly supports charging larger operators more. Its five-year licence for operating in the capital is understood to be due for renewal next month. However, the consultation closes in June and any new rules may not come into force for some time.

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