Taxi drivers are buying licences in Wolverhampton to get round tough rules aimed at protecting children, a Labour MP claims.

One-in-five private hire vehicles in England, such as Ubers and minicabs, have obtained licences from Wolverhampton City Council, where they are cheaper and less stringent than in other parts of the country.

Drivers do not have to get licences from their own local authority, under a law introduced in 2015.

Rotherham MP Sarah Champion says this allows drivers in her constituency to bypass tough safeguarding rules introduced after a 2014 child sex abuse scandal.

“The frustration is that in Rotherham we have probably the best regulation in the country and we’re trying to get that adopted nationally,” she told the BBC.

“We needed it because a lot of children who were being exploited were being raped in taxis or being transported from one children’s home to the abuse location through a taxi.

“The problem is those regulations are only set by the licensing authority so unless we get national minimum standards then drivers can go to a different local authority with different regulations and still drive in Rotherham.”

Only 1,781 of the 48,447 drivers currently licensed by Wolverhampton live in the city, with the rest operating as far afield as Newcastle, Somerset, Cardiff and Skegness.

The cost of a one year private hire licence in Rotherham is £210 and applicants must sit a child and vulnerable adults safeguarding test with a 100% pass rate. They also have to fit CCTV cameras to their vehicles, which can cost upwards of £350.

In Wolverhampton, by contrast, a one year licence costs £49.

Wolverhampton City Council insists it takes safeguarding seriously – and applicants receive training in at as part of a one-day course they have to take.

But Rotherham driver Lee Ward, a Unite the Union representative for South Yorkshire, said out-of-town licences were making taxi drivers “very frustrated”.

“Unfortunately a lot of taxi drivers around here were tarred by the same brush as those who were criminals,” he told BBC News.

“These are innocent drivers who were all of a sudden hit by so many extra regulations, training, CCTV.

“They’ve all gone through that – with open arms and a glad heart – just to sit next to a taxi who has a license in another authority 100 miles away, with officers who never come to Rotherham or Sheffield to check their drivers.

“It just makes a mockery of what they are trying to do.”

Wolverhampton City Council has generated millions from issuing licences to taxi drivers around the country but says the money has been ploughed back into reducing fees.

A City of Wolverhampton Council spokeswoman said: “The council would refute any suggestion of prioritising earning money over passenger safety.”

In a recent report, the council said: “As the number of licensees increase, the likelihood of a serious issue taking place.

“There has been serious child sex exploitation scandals revealed in Rotherham and Telford, which involved taxi drivers.

“Licensed vehicles provide a ‘camouflage’ which allows vehicles to traffic vulnerable people, as well as the offer of free trips for grooming. It is the service’s goal to minimise risks by all legal means.”

Earlier this year, Louise Haigh – who is now transport secretary but at the time was in opposition – raised the issue of child safeguarding in a debate on taxi licensing, saying she had worked alongside victims and survivors of child sexual abuse in Rotherham.

She said: “Following the scandal, Rotherham council set very high standards for its taxi drivers, including installing CCTV in cabs and requiring national vocational qualification level 3 on child safeguarding.”

She called on then Conservative government to bring in “robust legislation” and national minimum standards to protect women and girls.

Sarah Champion has written to Haigh asking for new laws to ensure taxis must be licensed “in the local authority area in which they routinely operate”.

A Department for Transport spokesperson said: “Everyone deserves to feel safe when using a taxi or private hire vehicle and we’re aware of concerns around licensing.

“There are safeguarding procedures in place and all drivers must undergo enhanced DBS checks, but we are carefully considering the options available to improve safety and accessibility in the sector.”

MPs are due to debate the issue later on Monday.