Legal Aid, Sentencing and Punishment of Offenders Bill

Lord Henley Excerpts

Tuesday 20th March 2012 Lords Chamber

[Lord Faulkner of Worcester]

My Lords, this has been quite a long journey. I first asked an Oral Question on 3 October last year, arguing the case for cashless transactions and the necessity of amending the Scrap Metal Dealers Act 1964. On 10 November, in a Remembrance Day debate initiated by the noble Lord, Lord Selkirk, a number of noble Lords, including me, spoke about the despicable theft of war memorials for their scrap metal value.

The Bill we are debating tonight received a Second Reading in your Lordships’ House on 21 November, and I gave notice of my intention then to table the amendment which appears today on the Marshalled List. I drew attention to ACPO’s estimate that the national cost of metal theft was £770 million. I also referred to the 16,000 hours of delays suffered by rail passengers over the past three years caused by the theft of signalling cable, and to other examples of metal theft such as lead from church roofs, manhole covers, telephone wire and works of art.

Since then the scale of the problem has continued to grow, and every week brings fresh accounts of new theft. Last week, for example, my own local newspaper, the Worcester News, reported that 350 metres of BT underground copper cable had been stolen, which cut off telephone and broadband service in one of the major districts of the city. Numerous heritage railways have written to me to say that scores of metal items such as rails, lamps and even a fork-lift truck have been stolen for their scrap value.

I have another press report dated 1 March saying that seven churches are being targeted and robbed every night for the lead on their roofs; and in a new twist Network Rail reports that, in recent signalling cable thefts on the Cotswold line between Oxford and Worcester, the theft of a 650-volt distribution cable had been concealed by the insertion of a short length of domestic cable in its place—an incredibly dangerous manoeuvre. On it goes.

To his credit, the Minister has indicated that he is determined to do something about it, as did his predecessor, the noble Baroness, Lady Browning. I am particularly grateful to her, and to the right reverend Prelate the Bishop of London, for putting their names to Amendment 156D, and for their stamina in staying here at this late hour tonight.

The Home Secretary announced in a Written Statement on 26 January that government amendments to the Bill would be tabled to,

“create a new criminal offence to prohibit cash payments to purchase scrap metal; and significantly increase the fines for all offences under the existing Scrap Metal Dealers Act 1964”.—[Official Report, 26/1/12; cols. WS 80-81.]

The Minister may be aware that I immediately issued a statement warmly welcoming that announcement. It took a long time for the government amendments to appear, but last week they finally did, and we are debating them now as Amendments 157F, 157G and 157J.

What the Government are proposing is fine except for one baffling respect. For reasons that have not been properly explained so far, they are proposing an exemption for itinerant sellers. As I understand it, that will mean that the sale of metal to an itinerant collector will not have to be recorded, whether it is a householder getting rid of some unwanted domestic appliance or a metal thief using the itinerant as a way of getting into the chain. By proposing that exemption, the Government are opening up a serious loophole that could undermine much of the benefit that their move towards cashless transactions will create.

My understanding is that it is not difficult to register under the Scrap Metal Dealers Act 1964 as an itinerant collector, which is defined in that Act as,

“a person regularly engaged in collecting waste materials, and old, broken, worn out or defaced articles, by means of visits from house to house”.

While there may not be too many of those registered at the moment, surely there is a risk that there will be many more once word went round that this was a way to avoid the cashless requirement of being a scrap-metal dealer.

The Minister will be aware that the itinerant seller exemption has caused alarm among many in the industry. For example, SITA, to which both the Minister and I have paid visits in recent months to discuss this legislation, said this in its latest briefing:

“There is no reason why a cashless system cannot be implemented by bona fide itinerant collectors, along with the rest of the scrap metal industry … Moreover, the requirement for a cashless transaction between the itinerant collector and a scrap metal merchant will in any event necessitate the former to maintain a bank account with provision for electronic or cheque payment. It is therefore illogical to exempt the initial transaction between the seller and the itinerant collector, but to (rightly) mandate a cashless transaction for the on-sale of the material to a scrap metal dealer. Traceability over the entire chain, from seller to intermediary to dealer, will be broken along with proof of provenance of the metal presented for sale”.

That is a pretty convincing argument and is why I have tabled my own Amendment 157H to the government amendment to delete the exemption. I shall listen very carefully to the Minister's response to these points before deciding whether to press that amendment. In particular, I hope that I will hear him say that the Scrap Metal Dealers Act will be replaced by an entirely fresh piece of legislation to be introduced in the new Session. That could deal with all the issues relating not just to itinerant sellers but to the registration and licensing of the trade generally. Meanwhile, it would be churlish of me not to welcome the Government’s acceptance of the argument that I first put forward almost six months ago that an essential first step in tackling the epidemic of metal theft is to move to cashless transactions and to increase the penalties for persons committing this appalling, anti-social and dangerous crime. I beg to move.

[The Minister of State, Home Office (Lord Henley)]

It might be useful if I intervene at this stage. In doing so, I want to make it quite clear that I hope other noble Lords will intervene after me despite the fact that this is Report. This is purely because I have amendments in this group and it might speed up the process by which we debate these matters.

I pay tribute to the noble Lord, Lord Faulkner of Worcester, for all that he has done. We have listened to him and, as he knows, we have responded as much as we can in due course. I also want to make it quite clear that we in the Government recognise what a serious problem it is. I cannot list in detail the individual Peers, Members of the Commons and others who have been to see me. The right reverend Prelate the Bishop of London was the first to come and see me to highlight the problem relating to the churches. Obviously, this problem goes beyond the churches and beyond art theft; we all know about that Barbara Hepworth that was stolen recently. This affects communities and businesses throughout the country. We have seen damage to our infrastructure, to the railways, to communications and so on again and again and that damage is very great indeed. The noble Lord quite rightly cited an estimate of some £700 million. That is probably the effect on business and the community as a whole. What is depressing is how little money it actually brings in to the thieves themselves. The Barbara Hepworth that I mentioned, insured for £500,000 or £1 million or whatever, will have gone to some scrap-metal yard and been ground down and sold off for literally a matter of a few pounds. The real problem arises in the scrap-metal yards in that whoever was the first person to receive that—the first fence as it were—must have known that property was as hot as you can get because you do not often get Barbara Hepworths being brought in; they are not something you happen to find on the side of the road. So that is the problem and that is why the Government believe they should take urgent action.

That action can be taken in a number of different ways. The first and most important one is enforcement. The Government have made it quite clear that we want to address enforcement. My right honourable friend the Chancellor of the Exchequer announced late last year that there was an extra £5 million of funding for a new dedicated metal theft task force. The British Transport Police has taken the lead and is doing a great deal of work on this. In certain parts of the country we have seen great improvements in enforcement. I recently visited the north-east and saw what it was doing in terms of Operation Tornado, improving enforcement and increasing the number of arrests and cash seizures from the scrap-metal industry. That is happening throughout the country. Enforcement is one strand of what we must do and there are other things that we can do in terms of design and hardening objects so that they are less easily stealable or more traceable. However, we have concluded that legislation of one form or another is the only sustainable long-term solution to the growing menace of metal theft. That is why we have put down these amendments. They are similar to the amendments the noble Lord has put down but I have to say, as I always would, I think the government amendments are superior to his and I hope he will accept them in due course.

I want to keep my remarks brief, but will explain that the new amendments create a new criminal offence to prohibit cash payments to purchase scrap metals. We believe that at the moment it is just too easy for someone having stolen something to convert that something into cash, no questions asked. They also significantly increase the fines that are available for the majority of the offences under the Scrap Metal Dealers Act 1964, which regulates the scrap-metal-dealing industry. That is important. It only goes some way because, as I have said on a number of occasions, we believe that the Scrap Metal Dealers Act is not now fit for purpose but that it is worth at least upgrading the offences under that Act. But one should always remember that under the old Theft Act 1968 there is an offence of seven years for theft and more importantly, as I said earlier, under handling we have some 14 years available.

[Lord Campbell-Savours]

The story in the Commons is that the Government are saying that that subsequent legislation will be brought in under the Private Member’s Bill procedure in the House of Commons. Is that true?

[Lord Henley]

My Lords, I do not believe all stories that I hear, either in this House or in another place. I was going to come on to what we will do with scrap- metal dealers in due course. To put it briefly, we have found this opportunity under this legislation to make a number of changes, but we cannot completely redo the Scrap Metal Dealers Act under this legislation because of the scope of the Bill. We will certainly look at all legislative opportunities in the new Session to see how we can revise the Scrap Metal Dealers Act. All that I and other colleagues have said is that we believe that the Scrap Metal Dealers Act is no longer fit for purpose; it is past its sell-by date. How we revise that legislation, we will have to address in the new Session.

I have spoken of the first two changes that we are bringing in as a result of the Bill: making cash payments illegal and increasing fines under the Scrap Metal Dealers Act. Thirdly, we want in this Bill to revise the police entry powers to ensure compliance with the new offence. That, again, is something that will make the whole enforcement procedure easier for the police.

[Lord Roberts of Conwy]

Can the Minister confirm that even under his amendment itinerants can still have scrapyards of their own? Can they still have cash transactions and still not be inspected except under warrant?

[Lord Henley]

I shall come on to the question of itinerants in due course. It is something addressed by Amendment 157H in the name of the noble Lord, Lord Faulkner. I will deal with it in some detail because it is important, as there has been a degree of misunderstanding about that point.

We are bringing forward these three changes under the Bill, and they are just a first step in taking forward a coherent package of measures to tackle all stages of the illegal trading of stolen scrap metal. In response to the noble Lord, Lord Campbell-Savours, I can give an assurance—although I cannot give a timescale for this—that we shall bring forward further measures in due course. We believe that going cashless, which is the crucial part of this amendment, will remove the “no questions asked” culture that allows low-risk criminal enterprise for metal thieves and unscrupulous dealers. That is something that we want to deal with.

I turn to Amendment 157H, tabled by the noble Lord, Lord Faulkner, as an amendment to government Amendment 157G. It removes the exemption for itinerant collectors—and I make it clear that it is purely itinerant collectors whom we are dealing with—who have an order in place under Section 3(1) amending the record requirements that apply to them. Let me make clear that this is not a blanket exemption. Only itinerant collectors who are subject to an order under Section 3(1) of the Scrap Metal Dealers Act 1964—an Act that I described as being past its sell-by date, but it is still what we have—coming from their local authority and approved by the local chief officer of police will be exempted. This will be a modest number of individuals who will be known to both the police and their local authority. They will also be bound by environmental regulations with the need to have a waste carrier’s licence under the Waste (England and Wales) Regulations 2011.

Most importantly, 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.

I hope that that assurance will be sufficient to allow the noble Lord to understand that I do not think his amendment is necessary. It might be that we will have to come back to this at Third Reading, but I hope that on this occasion he will accept that we have got it more or less right and that some of the reporting of the exemption for the so-called itinerants is not exactly what he thought it was.

[Lord Berkeley]

Can the Minister clarify Section 3(1)(a) of the Scrap Metal Dealers Act 1964? It seems a bit odd that the only condition required of these people is that they,

“obtain from the purchaser a receipt showing the weight of … scrap metal comprised in the sale”.

We have all had receipts from people for getting things like that, probably without even a piece of carbon paper between the two. Why is it necessary to give such people an exemption when the only condition I see here is that they get a scrappy piece of paper as a receipt? It seems to be left wide open to shove things in a container and send them off to China without any paperwork at all.

--- Later in debate ---

[Lord Henley]

My Lords, first, they are not going to be shoving it into a container. This is, as it were, the rag and bone man going around collecting metal in the street. If he wants to get money for it, he is going to have to take it to a scrap yard. He is not going to get money for it by any other means. At that point, the provisions we are debating come into effect. If the noble Lord feels that we are creating an exemption that will create a loophole and drive a coach and horses through what we are doing, just by this small means of exempting the itinerants going around, he has probably got it wrong. He obviously does not accept what I have to say, but I think that he has misunderstood where we are coming from.

[Baroness Browning]

My Lords, I am grateful to the Minister for the explanation that he has given to the whole House, particularly in respect of the amendment tabled by the noble Lord, Lord Faulkner of Worcester, about itinerant collectors. However, I was pleased to add my name to Amendment 156D because, as my noble friend will be aware, the overall increase in metal theft is very clearly parallel to the rising cost of metals around the world. It is a world market, and the theft of the more valuable metals, such as copper, has particularly increased as the world price has gone up.

However, I remind my noble friend—not least in the context of the welcome news that we have in the government amendments tonight and the proposal completely to reform and amend the existing scrap metal Act—that it is very clear from the evidence from ACPO and others that scrap-metal theft is part of organised crime in this country. It is very easy to think that these are just opportunistic thefts, when people happen to see something that they might take on a dark night, and that sort of thing, but that is far from the case. Given that it is part of organised crime, I hope that my noble friend, in looking to get to grips with the reform needed in this area, will bear in mind the fact that very often it is the criminals who organise the people who, in practice, carry out the theft who make the most money. They orchestrate others: sometimes people who, I am quite sure, are fully aware that they are carrying out a criminal act but who themselves are not necessarily the beneficiaries of the full amount of the value of that scrap.

Reference was made just now to the Hepworth statue and how its melt-down value would not have been very much in comparison to its insurance value. The right reverend Prelate, on behalf of the churches, made very clear the overall cost to churches when they are robbed of the lead on their roofs, very often not just once, and the difficulty with insurance going up. The cost of these crimes is not just the melt-down value of the metals. It is also the consequential losses.

I would also respectfully remind my noble friend of the developing pattern in metal theft of what is referred to as rare earth. Very small quantities of these valuable metals can raise significantly more than copper and other more traditional metals. They are the sort of metals found in wind turbines and electricity generating stations. They are now starting to appear because yet again their value on the world market has gone up. Any reform to the scrap-metal act needs to take account of current trends, which are moving away from some of the more traditional metals to some of these more sophisticated metals.

I welcome the Government’s move to take out the question of this being a cash-based business—and one hesitates almost to use the word “business” in this context, but I suppose one must. They should bear in mind in any changes that they are bringing in to cover these wider issues that there is a sense of urgency about the need for more radical change. That change, if it is to address the increasing problems that we have, must look to those trends and to the future.

--- Later in debate ---

[Lord Berkeley]

My Lords, I congratulate my noble friend Lord Faulkner on taking this matter forward with so much pressure and commitment. My concern is that we seem to be discussing a parallel universe. The people in the BMRA, referred to by the noble Lord, Lord Roberts, do everything according to the book, and we are very grateful to them. However, I believe that there is the growing involvement of organised crime in this, as the noble Baroness, Lady Browning, said.

I have heard quite a lot of evidence about the way in which containers can disappear overseas without anyone knowing what is in them. It is not very difficult, especially if you do not live in a leafy part of Surrey or Buckinghamshire, to hide containers, and itinerant scrap merchants can get the metal into containers without anyone knowing very much. Perhaps the money comes from overseas. As many noble Lords said, the problem will grow. In the short term, the only solution is to support my noble friend’s amendment to get rid of this major loophole.

[Lord Henley]

My Lords, perhaps I may sum up the debate and address some of the points. Earlier I paid tribute to the noble Lord, Lord Faulkner, for all that he had done on the matter. I also pay tribute to my noble friend Lady Browning, who was the Minister who dealt with this before me. Only a few days before she unfortunately resigned and I moved to the Home Office, she summoned me and a host of other Ministers to the Home Office to discuss what we could do government-wide to address the problem. As a Defra Minister with a considerable interest in recycling and associated matters, I went along and said that it was possible that we might be able to do something through the Environment Agency. Soon after I left the meeting, my noble friend moved on and I found myself moving to the Home Office and in effect writing a letter from myself to myself to try to address these problems.

I am grateful for all that my noble friend did, and for the fact that she has now underlined some of the other problems that are beginning to appear in this matter. She referred to the problems with rare earths. I was recently in the north-west at a meeting dealing with truck theft. Truck theft is obviously very serious in terms of trucks and their contents being stolen, but certain bits of the trucks are also stolen to get the rare earths from, such as silencers, which can be of considerable value and whose theft can cause enormous problems.

I pay tribute to everything that my noble friend has done to highlight these problems. Similarly, I pay tribute to what the right reverend Prelate had to say and thank him for coming to see me to highlight the serious problems that the church is facing, particularly with the theft of lead roofs and with getting insurance on a great many church properties because of what is going on.

The noble Lord, Lord Campbell-Savours, asked me to comment on House of Lords reform. At this time of night, that is beyond my pay grade and I am not going to deal with it, but no doubt we will have further opportunities to discuss it in due course. He talked about the need for consolidated reform. I agree with him; I would like that in due course. I have made it clear that what we are doing at this stage is bringing forward the first stage of a package to get coherent reform in this area. It would not be right to delay the first few steps of that, as the noble Lord is suggesting, purely because we cannot get on to the other bits; we will get to those other bits in due course.

The noble Lord also said that the industry says that this will not work. Like the noble Lord, I have talked to the industry. I have addressed the BMRA; I have been to its annual parliamentary reception. The BMRA has made it quite clear to me that it welcomes virtually every aspect of reform. The only aspect that it is not terribly keen on is getting rid of cash. As someone else once said, “They would say that, wouldn’t they?”. I happen to think, as do most people in this House, that getting rid of cash from these transactions is a very useful thing to do and something that we ought to address.

The noble Lord made two other points that ought to be addressed. He asked about itinerants. I made it quite clear in my opening remarks that only itinerant collectors who are subject to an order under Section 3(1) of the Scrap Metal Dealers Act from their local authority, approved by the local chief officer of police, will be exempted. If they are also a scrap dealer and they have a yard, they will no longer fall within that definition of being an itinerant trader and therefore they will not be exempt. We are only talking about a very small number of people, who will be covered by the regulations that are in place at the moment. They are regulated.

[Lord Campbell-Savours]

The Minister seeks to reassure us, but what happens if over the next few years there is a noticeable shift in favour of itinerant collectors and the illegal trade? Will the Government come back to amend the legislation or will they review it?

[Lord Henley]

My Lords, we have made it quite clear that we are going to review it. We are going to keep this under control. The noble Lord is forgetting how few of these itinerant traders there are. They are not the people with the yards; they are people who are already regulated. The minute they have a yard they cease to qualify as an itinerant trader. It is as simple as that.

[Lord Berkeley]

Can the noble Lord say how many there are? He says that there are very few, but is it 10, 100 or 1,000? It would be very helpful if he could say.

[Lord Henley]

My Lords, I cannot give the noble Lord that figure without notice. I have no idea. I imagine that it might be possible, at disproportionate cost, to find out the number. All I am saying is that if they want to be an itinerant trader of that sort, they need a licence from their local authority and that has to be approved by the police. There is a very strict control on that particular aspect.

The noble Lord, Lord Campbell-Savours, rightly pointed to another problem—displacement. Could some of this go to Scotland? We are well aware of this problem. As the French discovered when they introduced a similar system, there was a danger that things would cross the border into Belgium and Germany. I have discussed this with colleagues in Northern Ireland and Scotland, although Scotland is more important, as there is a land border. Our colleagues in Scotland are well aware of what we are doing and are in full consultation with us. They will try to make sure that whatever they do keeps in line with what we wish to do.

The noble Lord is, for honourable reasons, merely seeking delay—delay that I am sure the BMRA would think was a worthy object to achieve. However, we do not think that it is right. We think that it is right to get rid of cash as soon as possible from this industry and that that will make a difference.

The last point that I want to address is that made by my noble friend Lady Hamwee about timing. I am afraid that I cannot give any categorical assurances to her about when and how we will get that further legislation. However, I make it clear, as my honourable friends in another place have done, that this is the first part of the package. We want to continue taking forward a coherent package to deal with all the other matters in the future, but I cannot give her any guarantee about timing.

[Baroness Hamwee]

My Lords, I did not expect my noble friend to be able to help me with regard to future legislation. I am sorry that I did not make myself clear. I was asking about commencement of these provisions, which will shortly find their way into the Bill and the Bill will no doubt shortly make its way on to the statute book. I am concerned about the current provisions.

[Lord Henley]

My Lords, these provisions will come into effect soon after Royal Assent, but I will check up on that and allow my noble friend to have the precise answer in due course.