Goods & Passenger Operators: revised financial standing levels from 1 Jan 2021
The amount of readily accessible amounts required by Standard National and International operator’s licence holders has been varied upwards slightly as follows:
- First vehicle: £8,200 (increased from £8,000 in 2020)
- Additional vehicles: £4,550 (increased from £4,450 in 2020)
The requirement to have the necessary financial standing is mandatory. A failure to comply with this may lead to serious consequences, not least the revocation of the licence. Where a licence holder is unable to fulfil this criterion it is open to them to apply to the Traffic Commissioner for a ‘period of grace’ within which to satisfy it. The financial standing requirement continues throughout the lifetime of a licence and is not simply applied when the licence is applied for or varied.
The amounts required for Standard licences are reassessed annually on 1 October by reference to the value of the Euro against Sterling. There have been small increases over the last couple of years but the current levels are very much higher than those set for 1 Jan 2016 at £6,650 / £3,700, that was about 17% lower.)
In our experience there is a widespread lack of understanding as to how the financial standing regime operates, placing the licence under threat where funds are not adequate and readily available. By way of example, financial resources required for a limited company operator must be held by that entity – funds in directors’ personal bank accounts are not regarded as being available to such an operator.
How financial resources are regarded as being ‘available’ to operators is less than straightforward in many cases. Many operators are unwittingly breaching the requirements.
The amounts required for Restricted licence holders remain unchanged, as they have for many years, at £3,100 for the first vehicle and £1,700. The Department for Transport consulted on possible changes but this remains unresolved.
Finally, Standard operators (whose financial standing obligations derive from EU regulations) should assume that from 1 January 2021 they continue to have to comply with these financial requirements and not assume that they cease following the departure of the UK from the EU. All aspects of operator licensing will continue as before unless otherwise announced or changed by law, where required.
We Can Help You
For advice and assistance in respect of financial standing and all aspects of operator licensing, please get in contact with us on 0330 404 0777 or email email@example.com.
DVSA maintenance & driver investigations – 17 November at 10 am
Join Road Transport and Regulatory Law expert Tim Ridyard, and DVSA enforcement policy managers, Dave Wood and Mark Horton, who will be providing a topical update including how DVSA carry out fleet and drive investigations, to ensure operators have proper systems in place. Book here.
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