An industry view: How is it going with the Scrap Metal Dealers Act 2013?

Written by: RWW | Published:

The aims of the Scrap Metal Dealers Act 2013 have been welcomed by trade bodies, legitimate scrap metal dealers, the police and the Home Office, however, how is its implementation going? Nicola Guest, marketing manager at Alchemy Metals & Carbide Recycling, reports from the coal face of the industry.

During the last 12 months we have seen immense changes within our industry that are unprecedented.

Whether you agree or disagree, the changes are here to stay. Government has finally got to grips with metal theft and forced legislation upon an industry that has historically been apathetic at best about the dubious nature of materials that passes through its doors so out of the ashes of apathy the Scrap Metal Dealers Act 2013 (SMDA) has risen and although in its infancy many are questioning the methods and the inequity of its enactment.

Enforcing traceability

Fundamentally the new Act is good. It is expected to tackle metal theft by forcing traceability of transaction while placing minimal red tape upon our industry and it ensures that all traders, regardless of size, can operate on a level playing field.  

Some feel that the enhanced record keeping requirements are onerous, we do not agree; and yes, transactions take a slightly longer time, but for us, this time is worth it to ensure that stolen materials do not make their way into legitimate merchants’ yards.

The proof is in the statistics. With the one year anniversary of cashless trading fast approaching, the figures show a drop in metal theft of 70% in some areas; more widely 50% is commonly seen, yet still we regularly hear of some merchants criticising the 2013 Act and specifically cashless trading as their customer numbers have dropped. 

Ironically the drop in business appears to correlate with the drop in metal thefts.

Having gifted our industry with effective new legislation, the actual enactment of the Bill has so far come as somewhat of a disappointment.

The Act was handed over to district councils earlier this year; they are to manage and enforce compliance of the new Act, however from very early on, many councils were concerned about the additional workload coming their way and the timescales allotted to put the new systems and procedures in place.  

Enough communication?

In fact, as late as 2 October 2013, the Home Office was sending out supplementary guidance to district councils to resolve the many queries that were being raised. This has resulted in questions being raised over whether there has been enough communication to all traders to help them comply.  

In our experience, the communication surrounding the new SMDA has ranged from fantastic to downright incompetent; completely dependent on which district authority area you find yourself in.  

It is fair to say that some areas have not been at all proactive in informing dealers of the changes; this I am sure has caused much frustration for some companies.

Some councils, in particular those with larger numbers of scrap metal dealers, appear to have had excellent communication and control.

These are typically the areas where we are seeing the higher fees; these councils understand that in order to effectively manage the new system, they must be able to cover their costs while scrap metal dealers within those areas should perhaps take some comfort that paying a higher fee could be a good return on investment; provided the council is doing its job properly.

More concerning are those who are only charging nominal amounts. Have they failed to understand the remit of the SMDA 2013 or do they simply not have that many scrap metal dealers, or mobile collectors, within their patch?  

A straw poll of 15 district authority areas showed site fees ranging from £230-£1236. This is a vast difference. 

What is clear is that some district councils, should they control the system as they are supposed to, may find that ultimately they end up operating the new Act at a loss by having not budgeted enough for truly effective management of the new law.

View of the British Transport Police

Inspector Robin Edwards, deputy national coordinator - metal theft, British Transport Police, who we have worked closely with and who have been so instrumental in bringing about the new SMDA, advises: “The SMDA demands a greater level of awareness and responsibility from traders, ensuring they verify who they are doing business with, but it also protects law abiding recyclers from unscrupulous traders. 

“It is vital that scrap metal traders are aware of the changes, including the new licensing regulations. 

“Metal thieves cause misery for thousands of people, whether targeting the rail network, power cables or telecommunications and the new Act has been designed as a more robust licensing scheme to be monitored by local authorities,” continues Inspector Edwards.

We still wait to see the impact of the Disclosure Scotland Checks that every director, partner, owner and site manager should have taken. 

How robustly will any previous relevant convictions be taken into consideration?  

Will there be merchants out there with previous metal theft or money laundering convictions whose licence will not be approved? We certainly hope so; for if they slip through the net and are allowed to continue to trade it would make a mockery of the new law. All merchants who were already registered with their district council should have had their licence applications in place by 15 October, otherwise we were told we would not be allowed to trade. 

One district council I spoke to advised that out of nine existing registrations they had not allocated any temporary licences and yet all nine in their area continue to trade. 

Confused over the mixed messages? 

I am. Certainly post-1 December should be interesting. We would expect to see a robust implementation of the new law along with active police and district authority checks to ensure all are complying with the new laws, on a national basis.  

Will the level of activity completely depend upon which district authority area you happen to be lucky enough or unlucky enough to be in? We hope not.

These are challenging times for many merchants within our industry. We remain avid supporters of the SMDA 2013, however ultimately any new law will only work if it’s policed effectively. 

Whether the funds, knowledge or motivation are in place to do this remains to be seen.

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