Government urged to rethink cash ban exemption

Pressure is mounting for the government to reconsider plans to exempt itinerant metal dealers from a cash ban for trading scrap, ahead of a crunch debate on the issue tomorrow (April 17).

The British Metals Recycling Association (BMRA) has warned that not including itinerant traders in the cashless system could undermine the governments attempts to combat metal theft, as Parliament prepares to consider proposals that would overhaul the Scrap Metal Dealers Act.

Home Secretary Theresa May announced in January 2012 that the government would ban cash trading for scrap metal dealers under the Legal Aid, Sentencing and Punishment of Offenders Bill (see letsrecycle.com story).

Under the proposals rag and bone itinerant collectors who are registered with their local authority to trade scrap metal will still be able to pay cash for scrap. The move has drawn criticism from the BMRA, which claims that itinerant traders are getting special treatment from the government.

Special Treatment

BMRA director general Ian Hetherington, said: This exemption is providing a loophole for unscrupulous dealers whilst penalising legitimate metals recyclers who have spent hundreds of millions of pounds complying with environmental legislation at fixed sites. The government is essentially giving itinerants special treatment by allowing them to continue to trade in cash.

Not only does it undermine the purpose for banning cash in the first place- to make it more difficult to dispose of stolen metal- it will damage those metals recyclers who are complying with a cash ban because the hundreds of thousands of small businesses and householders who sell scrap items every day will now take their business to collectors who will continue to pay cash under this exemption. There is a real risk that it will lead to the closure of compliant businesses causing job losses and a drop in recycling rates.

The BMRA had previously opposed the governments plans to introduce a cashless system, arguing that the move could simply drive the scrap trade underground (see letsrecycle.com story).

Opposition

According to the BMRA, tougher sentencing for offenders and stronger police powers of entry at illegal metal yards are needed in order for the ban to prevent the illegal trade in scrap metal.

However, despite lobbying Home Office minister Lord Henley, who has been heading up the governments metal theft response, the BMRA has accepted that the cash ban is now inevitable.

The exemption for itinerant traders also received opposition from Peers at a debate on the proposed legislation in the House of Lords last month.

Addressing concerns raised during the debate, Lord Henley said: No itinerant collector will receive cash from the scrap metal industry on which they are reliant for selling scrap to. Travelling around the streets picking up scrap, they will, when they take it on to the scrap yard, have to have that payment made not in cash but by some other means. Their transactions will be traceable for the first time, with the scrap metal industry recording details of the transaction and the payment method and to whom that payment is made.

The cash ban is among a number of measures that the government is introducing to update the existing law governing the scrap trade, which has been described by Lord Henley as outdated and not fit for purpose.

Under the proposals fines for breaching the Act are to be greatly increased, while traders convicted of any crime relating to metal theft will face having their license revoked and stricter requirements for dealers to request identification from people selling scrap will be brought in. The government has also pledged 5 million to establish a metal theft taskforce to improve law enforcement in the sector.