‘(1) Schedule (Private hire vehicles etc) (private hire vehicles etc) has effect.

(2) The Secretary of State may by regulations make provision which—

(a) has a similar effect to the amendments made by Schedule (Private hire vehicles etc), and

(b) applies in relation to Scotland or Northern Ireland.

(3) Regulations under subsection (2) may—

(a) amend, repeal or revoke any enactment;

(b) confer functions on any person.

(4) Regulations under subsection (2) may not confer functions on—

(a) the Scottish Ministers,

(b) the First Minister and deputy First Minister in Northern Ireland,

(c) a Northern Ireland Minister, or

(d) a Northern Ireland department.

(5) In this section “enactment” includes—

(a) an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978;

(b) an enactment contained in, or in an instrument made under, an Act of the Scottish Parliament;

(c) an enactment contained in, or in an instrument made under, Northern Ireland legislation.”—(James Brokenshire.)

This new clause inserts a new Schedule NS1 which amends the licensing regimes for taxis and private hire vehicles in England and Wales. It also contains a regulation-making power to amend the legislation in Scotland and Northern Ireland to equivalent effect as that Schedule.

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

With this it will be convenient to discuss the following: Government new schedule 1—Private hire vehicles etc.

Government amendment 245.

We move to new clauses, having considered the main substantive provisions of the Bill. New clause 14 requires immigration checks and continuing compliance with immigration laws as part of the existing licensing regime for taxis and private hire vehicles. It does so by adapting existing provisions for private hire vehicles in London in the Private Hire Vehicles (London) Act 1998 and for taxis and private hire vehicles in the rest of England and Wales in the Local Government (Miscellaneous Provisions) Act 1976.

The new clause seeks to prevent illegal migrants and migrants whose status does not permit them to work from holding taxi and private hire driver and operator licences. It is important to note that, because the majority of drivers are self-employed, they are not subject to existing right to work checks. In our judgment, that leaves scope for the sector to be exploited by illegal workers.

Licensing authorities already conduct checks to determine whether someone is a fit and proper person to hold a driver or operator licence. However, a licensing authority has discretion as to many of the checks that it undertakes to satisfy itself that someone passes the fit and proper person test. Many licensing authorities make immigration checks, but they are advisory at present. The new clause will make immigration checks mandatory and embed immigration safeguards in the existing licensing regime.

New clause 14 gives effect to new schedule 1, which amends the Private Hire Vehicles (London) Act 1998 for private hire vehicles in London and the Local Government (Miscellaneous Provisions) Act 1976 in respect of taxis and private hire vehicles in the rest of England and Wales. The new provisions also make relevant changes so that the same measures can be implemented in London, where the taxi licensing regime is slightly different, by amending the Metropolitan Public Carriage Act 1869.

We are in the process of consulting with the Northern Ireland Executive and the Scottish Government with a view to making similar changes to the licensing legislation in Scotland and Northern Ireland in the Bill or, if that is not possible, by regulations, for which provision is made in the new clause.

I will now comment in more depth on new schedule 1, the main meat of the provisions. On the changes to the Metropolitan Public Carriage Act 1869 for London, first, the provision ensures that where someone’s immigration leave is time-limited to less than the statutory length for a driver or operator licence, the licence will be issued for a duration that does not exceed the applicant’s period of leave. If someone has so-called section 3C  leave under the Immigration Act 1971, because they have, for example, made a valid application to the Home Office to extend their leave, any licence granted will be limited to a period not exceeding six months.

Secondly, if someone is disqualified from continuing to hold a driver or operator licence for immigration reasons, they must return their licence, any copy and their driver’s badge to the licensing authority. Someone who fails to return their licence within seven days without reasonable cause will be committing an offence and, on summary conviction, liable to a fine not exceeding level 3 on the standard scale and, in the case of a continuing offence, a daily fine for each day they fail to return the documents after conviction. Thirdly, the grounds for disqualification—this is for someone who already holds a licence—will include that someone has no lawful status in the UK, or has no right to undertake the work in question.

The Local Government (Miscellaneous Provisions) Act 1976 and the Private Hire Vehicles (London) Act 1998 are similarly amended for operator and driver licences. In addition, the new schedule provides that a licence must not be granted under those Acts to someone who is disqualified by their immigration status. The licensing authority must have regard to any guidance issued by the Secretary of State in making a decision about someone’s immigration status. Importantly, the new schedule also specifies that the conviction of immigration offences and the requirement to pay penalties since the licence was issued are grounds to revoke a driver or operator licence. That is our approach, which intends to catch operators who may seek to engage people who are in the country unlawfully.

I would like further clarification from the Minister; I did not want to intervene in case he was coming on to this. Will he talk us through the logistics of how the legislation will be enforced?

I welcome the recommendations. I have not gone through the details of them, but it seems that currently different local authorities have different legislation and rules, so there can be confusion about who is responsible for enforcement of the local authority recommendations when people cross the border. Will the Minister talk a little more about how the legislation will be enforced and who will be responsible? He mentioned a seven-day period and said that the local authority would then have to enforce this. How does the local authority find out about that? What will happen with on-the-ground resources to enable the local authority to act? What happens if someone is in violation—will the Home Office or the local authority be responsible for that? I ask for practical ways in which the legislation will work.

I am grateful to the hon. Lady for her probing questions about enforcement. It is worth underlining that some licensing authorities are already doing basic right to work checks. That is what we are seeking to embed within the overall licensing regime.

Licensing authorities, under the provisions, will not be able to issue a licence to someone who has no lawful status and no right to work. That means they must be satisfied that an applicant has the right to live and work in the UK before granting someone a licence—that is to  say, a basic right to work check. At the moment, authorities seeking to assess licences, whether for an operator or driver, will ask for documents to be provided so that they can appropriately carry out the fit and proper purpose test. We are seeking to embed the basic right to work check that an employer might do. Again, the provisions do not seek to provide sophistication in any grand sense. We will provide guidance to licensing authorities on how to apply the measures and embed the good practice that is, in many ways, already being followed.

Where someone’s permission to remain in the UK is time-limited, authorities will know that because it will be clear from the applicant’s immigration status document. Authorities should not issue a licence for any period exceeding that duration. Furthermore, if the licensing authority is provided with information about other immigration law breaches by the applicant, it should consider those as part of the application process and, as the hon. Lady will understand, the fit and proper purpose test that authorities are already applying.

Licensing authorities may receive information from many sources that lead them to review someone’s eligibility to hold a licence, including immigration enforcement. The new clause makes it clear that if the licensing authority is informed that the holder of a driver or operator licence has breached immigration laws, those are grounds to revoke a licence. If information comes to immigration enforcement, they may then notify a local authority that evidence has been presented that may trigger revocation.

The hon. Lady is right to highlight the issue of who has responsibility. In England and Wales, district and unitary councils—referred to as the licensing authorities—have responsibility for ensuring that the public travel in safe and well maintained vehicles driven by competent drivers, as well as providing a fair and reasonable service for the taxi and private hire vehicle trade. Through that mechanism, these provisions will be effectively embedded within the existing structure. That is an important point.

As the hon. Lady may know, provisions in the Deregulation Act 2015 set a standard length for all taxi and private hire vehicle driver licences. The guidance and the provisions of the new clause will ensure that a consistent approach is taken by all licensing authorities to the checks undertaken. That assessment will effectively prevent abuse within the taxi or private hire licensed arena.

We have concerns—indeed, immigration enforcement will be conducting some targeted enforcement around this activity, to further develop our understanding of the challenges—that the self-employed nature of most drivers means they are potentially not subject to existing right to work checks, leaving scope for the sector to be exploited by people intending to work illegally. That is an issue not simply of ensuring the immigration provisions are applied appropriately and firmly, but of how the fit and proper purpose test applies. If someone is not in this country lawfully, does that imply there may be other breaches or issues? Indeed, does that call into question someone’s insurance and any conditions that apply to it? It is about a culture of ensuring high standards within the sector.

It is appropriate for me to underline that the requirements also apply to app-based operators and drivers. They are required to hold the same licences and, accordingly, the  changes will apply to them. It is about consistency, while recognising that different local authorities will be applying the rules. For the purposes of preventing exploitation of the arrangements, it is appropriate to put these measures in place.

In developing the proposals we consulted licensing authorities in England and Wales that between them account for about 60% of all licences issues. Many respondents—62%—reported abuse of the licensing regime. The most commonly cited concern was document fraud, including identity documents and MOT and other certificates from overseas. Immigration enforcement agencies also report illegal working in the sector. They work closely with Transport for London to identify and apprehend illegal workers. Regular enforcement activity is undertaken in Scotland, and in Edinburgh, for example, immigration offenders working as drivers are apprehended in operations every month.

This is a genuine issue. We are not trying to use a great big sledgehammer, but to put some in place basic requirements for right to work checks, as is proportionate. When people have been convicted of immigration offences, that fact should be equally relevant in the context of, for example, whether they hold an operator licence, to make sure that the standards on who is a fit and proper person are properly applied. That is the intention behind the measures.

I would like just a little more information. At the moment, if someone fails the fit and proper person test they can appeal through a magistrates court. Is it correct that under these measures that right would go and it would become a straight immigration issue?

Let us look at the provisions. Paragraph 12 of the new schedule amends the Local Government (Miscellaneous Provisions) Act 1976 as follows:

“In section 62(1) (suspension and revocation of operators’ licences) before the “or”…insert…“…that the operator has since the grant of the licence been convicted of an immigration offence or required to pay an immigration penalty”.

The point is that that will be a matter of established fact. The terms are further defined in proposed new section 79B of the 1976 Act, which is inserted by the new schedule, and defines immigration offences and immigration penalties. The measures will be embedded within the overall framework of the licensing arrangements. If the relevant local authority were, for example, to seek to revoke or suspend a licence, a legal process would no doubt be followed. The point is that it would be made clear whether an operator had been subject to these specific measures, because of the nature of the definitions.

The fit and proper person test is built in. It takes place when someone is applying for a licence. Immigration offences are a clear factor that will have to be weighed in any determination of whether someone is a fit and proper person. If someone does not have the right to be here, the new provisions make it clear that they should not be considered a fit and proper person. That is how we are embedding the measures within the existing process. We believe their operation can be effected smoothly. We will issue guidance, as I have already indicated, to assist local authorities in the implementation of the provisions.

This is a question of raising standards, to ensure that abuse does not take place within the sector. These are positive and important new provisions, which will see immigration enforcement agencies working with local authorities—something that, as I have indicated during our discussions, I strongly support. If we can get our activities embedded well, in places where immigration enforcement officers may come across intelligence and information, we can work smartly with other agencies such as local authorities to raise standards more broadly and root out abuse and rogue operators. The measures are important and distinct, and will, we hope, not only deal with immigration offending and people who are in the country unlawfully and engaging in employment or contracts for services, but raise standards in the sector more generally.

Question put and agreed to.

New clause 14 accordingly read a Second time, and added to the Bill.