Asylum seekers have been banned from using taxis for most medical journeys, Home Secretary Shabana Mahmood has announced.
The Government said the new rules will restrict taxi use for medical travel to exceptional, evidence-based cases such as physical disability, pregnancy or serious illness.
Any such journey would require Home Office approval.
The decision follows a recent BBC investigation that found âwidespreadâ use of taxis by asylum seekers, including for long journeys, with one case involving a 250-mile trip to see a GP.
Taxi drivers told the BBC the system was open to âabuseâ, accusing sub-contractors of inflating mileage, for instance by dispatching drivers over long distances to perform much shorter journeys.
One told Radio 4âs Today programme he had been dispatched from Gatwick to take an asylum seeker in Reading to an appointment 1.5 miles from his hotel, with a second driver sent from Heathrow to bring the same man back from the appointment.
It is understood the policy change comes after a Home Office review of transport arrangements for asylum seekers.
All service providers will be required to stop using taxis for medical journeys from February.
Ms Mahmood said the Government is working with providers to introduce alternatives â such as public transport â in a bid to save taxpayer money.
âThis Government inherited Conservative contracts that are wasting billions of taxpayersâ hard-earned cash,â she said.
âI am ending the unrestricted use of taxis by asylum seekers for hospital appointments, authorising them only in the most exceptional circumstances.
âI will continue to root out waste as we close every single asylum hotel.â
Liberal Democrat MP Paul Kohler, a member of the Commons Home Affairs Committee, welcomed the change, saying the money âwastedâ on taxis was a âshocking indictment of the contracts signed under the previous Tory governmentâ.
Mr Kohler told the Today programme: âIt never dawned on them it was a huge incentive to spend money.â
Earlier this month, Ms Mahmood set out a raft of measures to overhaul the asylum system, aimed at deterring illegal migration to the UK and making it easier to deport people.
The proposed changes include making refugee status temporary, subject to reviews every 30 months, and sending refugees home if their country is deemed safe.
The wide-ranging reforms drew criticism from Labour backbenchers.
Ms Mahmood told MPs it was the âuncomfortable truthâ that the UKâs generous asylum offer, compared with other European countries, is drawing people to UK shores, and for British taxpayers the system âfeels out of control and unfairâ.
The Home Secretary told the BBCâs Political Thinking podcast that she had already directed officials to âpilot a small programmeâ of increased payments âjust to see how it changes behaviourâ.
The UK currently offers payments of up to ÂŁ3,000 for some people with no right to remain in the country who agree to return home.
