The Scottish Government has moved to close a loophole that would have excluded the poorest taxi and private hire drivers from receiving payments of £1,500 to help cover costs such as licence fees and insurance payments for taxis not on the road.
The grants come from a £57 million fund intended to help all Scotland’s 38,000 private hire and taxi drivers – but the Unite Scotland trade union pointed out that many drivers would miss out on the payouts if they had previously claimed benefits, including universal credit.
As part of the initial deal, drivers could not apply for the grant if they had been in receipt of state benefits payments including universal credit, statutory sick pay, employment and support allowance, job seekers’ allowance and income support. Even those who have applied for universal credit but have not yet started receiving it were ruled out.
Unite said it had been inundated with calls from taxi drivers who said they had been forced to claim universal credit because their earnings had collapsed.
Unite Scotland Secretary Pat Rafferty said: “The poorest are being discriminated against, which is disgraceful. The trade has been afforded minimal support by the Scottish government to date and what has been offered has been too little and too late.”
But now taxi and private hire drivers who received state benefits at any time since March 2020 will now be eligible for the £1,500 business support grant as long as they meet the remaining criteria.
Scottish Business Minister Jamie Hepburn (pictured) confirmed that the change would come into effect immediately to ensure that drivers on the lowest incomes can access support.
However, Hepburn warned that UK Government universal credit rules mean that drivers could lose out overall if the grant is considered to be income by DWP. He has written to UK Secretary of State for Work and Pensions Therese Coffey asking for the £1,500 not to be considered as income.
Hepburn wrote: “This scheme is designed to help with fixed costs and is not intended to replace lost income, so I believe that it could be argued that it is inappropriate for this to be considered as income for the basis of calculating universal credit. I would ask you therefore to amend the criteria to ensure that drivers on universal credit can benefit from the full £1,500 payment without it reducing their overall income.”
An online Unite Scotland survey of more than 200 taxi drivers in December 2020 revealed that many drivers were regularly working 16-17-hour days but earning less than £50 per shift. And 30% of drivers had been unable to access any financial help from government support schemes. For those that had, the financial support represented less than 25% of their average earnings.
In a statement, Hepburn said: “We have responded to the concerns of drivers and we have removed grant conditions relating to state benefits. However, we remain justifiably concerned that any payment would simply be deducted from an applicant’s benefits. That is why I am urging the Secretary of State to do the right thing by drivers on the lowest incomes.”
He added: “Without a change by the UK Government, making these payments would benefit the Department for Work and Pensions budget, not the drivers, and risk using Scottish Government resources in a way that fails to provide additional support to many taxi drivers struggling to deal with the impacts of the coronavirus pandemic.”
Scottish First Minister Nicola Sturgeon said the payments were “intended to help taxi drivers meet their first costs at a time when they are receiving very little income”.
Local councils will contact drivers directly to help them get grants of £1,500. Councils will ask them to provide supporting information and bank account details. They do not need to apply, or contact the local authority.
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.”
She added: “Following the introduction of tighter regulations at Christmas I have trebled the budget originally announced for this fund to £57m, enough to provide grants of £1,500 to all of Scotland’s 38,000 taxi and private hire drivers.
To be eligible for the financial assistance taxi or private hire drivers must be licensed for the period October 9, 2020 to at least January 31, 2021, and drivers must have experienced at least a 50% loss of income compared with 2019.