Cash for metal ban could close small businesses, warn Rochdale dealers

Cash for metal ban could close small businesses, warn Rochdale dealers

Strict new laws being introduced to tackle scrap metal theft have been met with concerns from dealers in Rochdale.

From Monday 3 December it will be illegal for companies to pay cash for metal, and customers will be paid either by cheque or by electronic methods.

It is hoped payments will be easier to track and make it harder to deal in stolen metal, however, concerns are being raised about its potential impact on smaller companies.

“We could see a lot of people going out of business,” David Day of Greengate Metals, Middleton, said.

Mr Day explained even for a larger business like Greengate Metals costs involved in switching to a cashless system were high.

“We have had to pay a lot to change everything - we’ve had to pay for the literature saying ‘we will be changing to a cashless system’ which cost about £300,” he explained.

“We’ve also had to change our advert because it said ‘cash for metal’ and that was another £300.

“In all it’s run into the thousands, and whether it’s to go further we don’t know.”

He added: “We’re hoping it won’t affect our custom. We have a strong customer base and people still want to get rid of metal.”

Gareth Spence of CaR.I.P Ltd, who have a unit in Jermyn Street, Rochdale, echoed Mr Day’s concerns about costs and explained they had received a lack of guidance.

“Everything is at a cost,” he said.

“They wanted better CCTV so we paid to improve that. Then they wanted better records so we had to pay for better books.”

Mr Spence added: “I’m for the idea in theory but we’ve not really been given any warning. The government haven’t helped - they’ve just thrown it on us.

“They could have given us a bit of a head start, rather than just one month.

“We’ve still not had a letter issued.”

Other issues with the new law, passed as part of an amendment to the Legal Aid and Punishment of Offenders Act (LASPO), is a loophole allowing licensed itinerants to continue offering cash.

A bill proposed by Richard Ottaway, MP for Croydon South, will see this outlawed too if it is passed into law in Easter 2013 as expected.

Until then however, both Mr Day and Mr Spence are concerned about losing smaller custom.

“We’ve been operating since the 1970s and now they are changing a fundamental part of how we go about business,” Mr Day said.

“It’s a massive time of uncertainty that we’re all facing.

“About 90% of the businesses in Oldham and Rochdale have done all they can to stop crime but now we’ve had to pay for this new law while transients can still pay cash for metal.”

He explained: “A big problem is people who walk in with no more than £30 worth of metal. Maybe they’ve been clearing out the garage or somebody’s died and they’re emptying the house, they wouldn’t want a cheque.”

Mr Spence said: “I want it to work, I really do - the crime rate will go down and we won’t have to keep cash on site.

“But you still get people coming in with £5 worth of metal and you wonder if it’ll be worth it, having to write out a cheque every time.”

Not everyone is opposed, however, with Pete Dillon of Rochdale Scrap, Belfield Road, among those who believe the new act is necessary.

“I think it’s probably a good thing,” he said. “They have got to do something because we get people trying to sell metal from their vans a lot around here but we never buy off them.

“We don’t want anything dodgy in here.”

Mr Spence, despite his reservations, also believes the new law can work.

“If everybody has to abide by it then it should work. It works in Ireland so there’s no reason it wouldn’t work here.”