Discretion, localism and driver entry regulation

chapter.

2) Discretion, localism and driver entry regulation

The exercise of discretionary power and localism are dominant characteristics of the restriction of entry for drivers, just as they are for controlling vehicle entry. Discretion and localism are recurring themes throughout the study of restriction of market entry, and consequently throughout this chapter. In the case of driver entry, however, there is no clear explanation of why these notions are believed to be preferable to the alternatives or how these features are connected to the aim of regulation than there is in the case of vehicle regulation.

Regulation of entry into the taxi market for drivers, nonetheless, provides a different insight into the operation of local authority discretionary powers. The circumstances in which licensing authorities may exercise their discretion are much more circumscribed than for vehicles. Entry controls for drivers are built upon a discretion, the exercise of which is conditional upon satisfaction of a specified statutory standard.

There does not appear to be any reason why this approach is adopted in the case of drivers but not for vehicles. However, such a model provides a useful tool for analysis of how the exercise of discretionary power is connected to the protection of the public. The different approach used in the case of driver entry means that conclusions can be drawn about whether such a practice better achieves the aims of regulation.

It will be recalled from Chapter 1 that, before a driver may be granted a licence, the local authority has to be satisfied of two things: that the applicant is a ‘fit and proper person’ to hold a licence;¹ and that the applicant has been the holder of a full ordinary driving licence for a minimum period of twelve months preceding the application.² Both criteria produce their own difficulties which are considered in subsequent sections of this chapter. However, at this stage it should be noted that the grant of a driver’s licence rests on the exercise of discretion which is itself confined and structured, in Davis’ terms,³ by the preconditions of the qualifying criteria. The exercise of discretion lies not in whether to grant a licence but in deciding what factors constitute the qualifying conditions. Unless an applicant meets the necessary standard, councils are prohibited from issuing a licence.⁴ The local authority has no discretion to allow the application if one of the conditions is not met.

This approach to restriction of driver entry raises two issues. First, what sort of discretion is being exercised? Are councils simply required to interpret and apply the statutory criteria before deciding whether to grant a licence? Or are they obliged to create their own standards to determine the basis upon which their discretion is to be exercised?⁵ Second, how far does the exercise of discretion extend? Are local authorities exercising discretion in deciding both the meaning of the statutory conditions and how the facts are characterised within that meaning?⁶

1 Local Government (Miscellaneous Provisions) Act 1976, s 59(1)(a).

2 Local Government (Miscellaneous Provisions) Act 1976, s 59(1)(b).

3 KC Davis, Discretionary Justice: a Preliminary Inquiry (Louisiana State University Press, Baton Rouge 1969) 52.

4 Local Government (Miscellaneous Provisions) Act 1976, s 59.

5 Dworkin’s senses of ‘weak’ and ‘strong’ discretion respectively - R Dworkin, Taking Rights Seriously (Duckworth, London 1977) 31 – discussed in more detail in chapter 2 section 3.

6 DJ Galligan, Discretionary Powers: A Legal Study of Official Discretion (Clarendon Press, Oxford 1986) 35.

Although these two issues are useful for analysis purposes, licensing authorities do not exercise their functions with such distinctions uppermost in their thoughts. While councils appreciate that they are exercising discretion, they tend to focus their attention on the ‘fit and proper person’ criterion within which all other elements of their discretion are subsumed. In general,⁷ where this criterion is met to the council’s satisfaction, the grant of a licence will almost always follow. This is illustrated by the following statements from three of the respondents:

It’s all about the fit and proper person test, isn’t it? If they are fit and proper, then there’s no reason why we can’t give them a badge. We’re not here to stop anybody from making a living. If they are going to be safe on the roads and around passengers, then they should be allowed a licence. Interview 39, Senior Licensing Officer.

I think that the fact is that you’re working with old legislation which says you will if someone comes up, you will give them a licence. So that’s the starting point. Now the legislation says if there’s a fit and proper person, he gets the licence. Interview 7, Enforcement Officer.

We go by the phrase ‘fit and proper person’ as far as the driver is concerned and that is something usually we don’t need to worry about that at all, particularly with our drivers. They’re particularly good so most applications go through without a problem. Everything depends on whether they are fit and proper in our view. Interview 14, Chair of Licensing Committee.

These statements support the view from the literature that, from a practical perspective, distinctions between the exercise of strong and weak discretion or questions about how far discretion extends are immaterial, as all such issues tend to be determined together.⁸ Although councils are called upon to interpret the phrase ‘fit and proper person’ before applying the test to the circumstances of the application with which they are presented, Dworkin’s weak sense of discretion, they are not provided with any guiding principles upon how the phrase is to be interpreted. This

7 Some exceptions to this generalization are discussed in sections 4 and 5 of this chapter.

8 Galligan (n 6) 35.

suggests that local authority officials will have to determine their own principles upon which their discretion is to be exercised – the strong sense of discretion in Dworkin’s terms. However, as the above points illustrate, councils do not divide their decision making into such fine distinctions. Reliance on the ‘fit and proper person’ criterion as the sole consideration upon which to base the exercise of discretion means that councils are giving little thought to how this phrase is interpreted by them. As the quotations mentioned above illustrate, local authorities tend to treat the ‘fit and proper person’ criterion as if its meaning is self-evident, when it is not. And yet it is the interpretation of this criterion, as well as its application, which creates such a variety of approaches by the councils. It is in these respects that councils may be said to be exercising strong discretion in devising their own standards outside settled principles and using discretion in the interpretation of criteria and application of the relevant facts. However, I think a better view is that of Galligan, who argues that any official exercise of power must be explicable in terms of its purposes and within recognised principles.⁹ Licensing officials should be able to explain why an individual is considered to be a fit and proper person and how that finding is grounded in the purposes of the legislation. There ought to be some measure of consistency both between different councils and within the same council.

What each council understands by ‘fit and proper person’ is determined as a local issue. The following statements from three of the respondents indicate that local authorities regard it as appropriate that the criterion should be interpreted in accordance with local standards:

9 ibid 20.

We may want to set different standards to, say, [neighbouring authorities]. It’s right that there should be freedom in the legislation to give us discretion to set standards locally. Interview 5, Chair of Licensing Committee.

[This authority] isn’t [the neighbouring authority] and I don’t want our drivers to worry that we will follow their decisions. They have a totally different environment to work in. It’s local decisions, based on local needs. We have our own way of deciding these issues. Interview 14, Chair of Licensing Committee.

I’d say the balance is about right as having discretion allows us to be flexible and do things our way, without being too concerned about any outside influences or what other authorities do. We can set our own local standards to make local decisions. Interview 37, Senior Licensing Officer.

Although localism significantly influences the interpretation of the qualifying standards, councils do not offer any further justification for local variations in those standards other than to differentiate their area from other local authorities. Councils do not address the issues of why their interpretation of the qualifying conditions is to be preferred to that of another area or why their local area’s requirements differ so much from those of other areas. However, because each council applies its own interpretation of the circumstances in which discretion may be exercised, localism also influences the methods of regulating driver entry, particularly when it comes to applying those methods in practice. The methods used to restrict driver entry are considered in the next section.

3) Methods of regulating driver entry

Historically, the power to grant a licence to a driver was unqualified and open-ended, but is now restricted by the need for applicants to satisfy the qualifying criteria of fitness and propriety and holding an ordinary driving licence for the minimum