TAXI fares in York are to be reduced.

Cabbies and city officials have agreed to scrap a “fuel surcharge” introduced last summer when petrol and diesel prices were at their peak.

Coupled with a freeze on standard fares, it means fares will now be 20p cheaper than they have been for the past eight months.

The reduction is set to take effect from June 1.

Stuart Robertson, vice-chair of York Taxi Association (YTA), said: “We are very happy about it. It was put in there to reflect the high cost of fuel and was part of the review we agreed on fares.”

He said the price of fuel had begun rising again, since the change was agreed, but said: “There is an element of swings and roundabouts. The price has started to go up, but we accept that when we did the review it was low.”

A City of York Council spokeswoman said: “We allowed drivers to put the fuel surcharge on when fuel prices peaked last year, and we are removing it because fuel prices have come down.”

Earlier this month, The Press reported that standard fares had been frozen at a starting point of £2.10 during the day and £2.90 from 10pm to 7am.

Fares are set by YTA in conjunction with the council, using a formula based on vehicle running costs, average earnings and the price of fuel.

The fuel surcharge was introduced on August 18 last year, and added 20p to every hackney fare.

At the same time, a higher fine was introduced for people guilty of damaging the inside of hackneys, such as by spilling take-away food or vomiting.

The fine was increased from £30 to £75. The council issued 15 new taxi licences last year, but a recent survey found demand had plummeted in recent months.

Consultants said average waiting times had fallen, and they estimated there were now fewer taxis and passengers.

They said that in 2008, 11,613 taxis left the Clifford Street, St Saviourgate and Rougier Street ranks each week, carrying 19,758 people; but said that had now fallen to 7,195 taxis carrying 11,211 people.

Mr Robertson said: “No industry can go to 55 per cent of capacity without it having an impact.”