The organisation doing the "telling off" here, the Information Commissioner's Office, is actually surprisingly good at these sorts of cases, on these sorts of scales. I know someone who was being followed by his landlord (by PIs -- looking for any breach of his tenancy agreement), and the ICO prosecuted all involved; a solicitor was disbarred and the landlord might face criminal prosecutions. In this case, the relatively small bit of government -- a city council, the smallest 'unit of democracy' in the UK -- being told off here has no choice but to take the ruling and stop taping everyone's conversation (and/or sexy fun time) in the back of a cab.
Quite why it is that the ICO can tell off Southampton Council for recording people routinely, and yet can do nothing about the fact that everyone's movements across and through London are routinely tracked, however, escapes me. There are more CCTV cameras in london per capita than anywhere else in the world; one need only walk around outside and be followed, tracked and dated whenever you're going anywhere. Automatic CCTV numberplate recognition algorithm will automatically fine you for stopping on a (double) yellow line for more than a minute, or for straying into a bus (or, now, unfortunately, "Games") lane, irrespective of whether or not you had any choice in the matter. I find it depressing that the specific extra-governmental regulatory body designed to stop these sorts of things is so powerless when it comes down to telling off people who actually are important.