Home Office announces scrap metal cash ban

The Home Secretary, Theresa May, today announced that the government intends to abolish cash payments for the purchase of scrap metal, in a bid to stamp out metal theft which costs the UK economy an estimated 1billion per year.

In a letter to parliament today (26 January), Mrs May also outlined the Home Offices intention to significantly increase the fines for all offences under the existing Scrap Metal Dealers Act 1964.

The move comes after proposals set out in a Private Members Bill by backbencher Graham Jones to update the Scrap Metal Dealers Act were rejected by Parliament last week (see letsrecycle.com story).

The new measures will be brought in quickly, if approved, by putting them into the Legal Aid, Sentencing and Punishment of Offenders Bill, which is already before Parliament. The clauses incorporating the measures will go before a House of Lords committee on Monday (January 30).

Home office minister for crime preventionLord Henley is expected to speak in support of the proposals when they go before the House of Lords next week.

In her statement to parliament, Mrs May, said: Cash transactions for scrap metal are often completed without any proof of personal identification or proof that the individual legitimately owns the metal being sold. This leads to anonymous, low risk transactions for those individuals who steal metal. In addition, the widespread use of cash facilitates poor record keeping by the metal recycling industry and can support tax evasion activity.

Opposition

The decision by government flies in the face of the metal recycling industrys trade association which has resolutely opposed a ban on cash payments without other measures also being introduced.

Today the British Metals Recycling Association clung to its stance that a cashless system will only drive trade underground (see letsrecycle.com story). BMRA director general Ian Hetherington said: The theft of metal is a huge issue for our industry and so BMRA genuinely welcomes the governments increased focus on it.

However the proposed ban on cash transactions as part of the amendment to the Legal Aid Bill will not solve the problem and will simply push the trade to illegal scrap yards.

Whilst we support the long term ambition of removing cash transactions, a range of other reforms plus effective enforcement of current legislation are needed to solve the problem.

Shadow home secretary Yvette Cooper, echoed the BMRAs view that a cash ban without tougher enforcement will not eradicate the market for stolen metal. She said: “The police have been clear they require greater powers to enter scrap metal yards and close dealers not obeying the rules. Banning cash payments could mean some illegal yards continue the practice, yet the police dont have the power to close them down.

“The Tory-led Government needs to get serious on metal theft, which has soared since metal prices went up. Thieves are creating havoc on our transport network, costing millions of pounds and creating dangerous situations for people on the roads. Wire theft is causing repeated power cuts, plunging communities regularly into darkness, and putting lives at risk.

Ms Cooper also indicated that Labour would be proposing alternative options including granting police additional powers to close rogue traders down and introducing a licensing system for scrap traders instead of the current local authority registration structure.

A report released by the Transport Select Committee earlier today supported the governments proposals to introduce a cash ban on metal transactions, but recommended further measures, including the compulsory requirement for proof of identity to be shown when selling scrap.